Research about consumer use of unit pricing

Impact: Public policy impacts

Description of impact

In 2012, the Australian Treasury conducted a Post-Implementation Review of the Unit Pricing Code of Conduct. The Retail Grocery Industry (Unit Pricing) Code of Conduct is a mandatory industry code of conduct that is enforceable under the Competition and Consumer Act 2010 to store-based grocery retailers and online grocery retailers after 1 December 2009.
The review adopted an academic submission by Oppewal, Yao and He on how unit pricing affects Australian consumers' grocery shopping decisions. The key findings were reported in the review included:
• consumers rely on unit prices when making purchasing decisions with 60 per cent of respondents including the unit price as one of the attributes they attended to most (where unit pricing was available);
• consumers are more inclined generally to choose lower priced products where unit prices are available with 57 per cent of respondents to a simulated shopping task choosing the lowest price item where unit prices were available (compared with 49 per cent where unit prices were not available);
• the presence of unit price information reduced information load and decision difficulty;
• while unit prices are more useful to consumers where grocery items come in assorted sizes, consumers still value unit prices even where products are sold in common sizes, weights or quantities;
• under time constraints, consumers are more likely to rely on unit prices to guide their purchasing decisions;
• consumers benefit more from unit pricing where they understand the principles of unit pricing; and
• consumer reliance on unit pricing varies with demographic characteristics including age and education.
Impact date2012
Category of impactPublic policy impacts
Impact levelAdoption