Decision tree

What is the decision tree?

In the FMCG world, the term decision tree is applied to the description of the process that takes the shopper from planning the purchase to selecting a specific product reference.

Three (main) types of purchases can be distinguished:

• Specifically planned purchase: "I will buy Coca-Cola Zero in cans"
• Planned purchase, but final decision at the shelf: "I will buy soft drinks, or a cola, or Coca-Cola, and I decide exactly which one in front of the shelf"
• Impulse purchase: "I hadn't planned to buy soft drinks, but availability and/or the offer create an impulse and I buy 6 cans of Coca-Cola".

Several studies agree that 70% of purchases are NOT planned in terms of the final decision on brand and variety. That is why it is very important to understand how the shopper makes their decision in order to make the purchase easier for them. Defining the decision tree for each category is the foundation of every action lever, whether it is the assortment, pricing, planogramming or the strategy in terms of promotions.