Seasonal Limited-Time Offers Motivate Consumers Through Tradition & Urgency
NEW YORK — Whether it's return of pumpkin spice lattes or green shamrock shakes, consumers buy into annual traditions with a sense of urgency, knowing specialty items like these are only available for a limited time.
According to The Role of the Limited Time Offer: How LTOs Can Be Used to Affect Consumer Behavior, a recent report by The NPD Group's receipt harvesting service Checkout, repeated limited-time offers (LTOs) like seasonal tap into a base of loyal buyers.
When a seasonal LTO debuts, it garners broad consumer interest because it's new. Then, over time, it plateaus to include the loyalist buyers while still attracting some new buyers.
Seasonal LTO buyers typically visit more and are more valuable customers to the chain overall, NPD found. For example, 24 percent of buyers who bought a Starbucks pumpkin spice latte in 2018 had purchased the coffee drink in 2017, and 32 percent of buyers in 2017 had bought the beverage in 2016. Starbucks debuted its well-known pumpkin spice latte LTO in August 2014. This year, it will be available starting Aug. 27.
"Limited time offers continue to be an integral element of a restaurant chain's and foodservice manufacturer’s marketing mix," said David Portalatin, NPD food industry advisor and author of Eating Patterns in America. "A well-executed LTO can boost sales and serve as a competitive edge for restaurant operators and help foodservice manufacturers test new products and concepts."
New York-based NPD Group offers data, industry expertise and prescriptive analytics to help clients grow their businesses in a changing world.