Retailers Dread Phone-Wielding Shoppers 725
Ponca City writes "The WSJ reports that until recently, retailers could reasonably assume that if they just lured shoppers into stores with enticing specials, the customers could be coaxed into buying more profitable stuff too. But now, marketers must contend with shoppers who can use their smartphones inside stores to check whether the specials are really so special. 'The retailer's advantage has been eroded,' says analyst Greg Girard, adding that roughly 45% of customers with smartphones had used them to perform due diligence on a store's prices. 'The four walls of the store have become porous.' Although store executives publicly welcome a price-transparent world, retail experts don't expect all chains to measure up to the harsh judgment of mobile price comparisons, and some will need to find new ways to survive. 'Only a couple of retailers can play the lowest-price game,' says Noam Paransky. 'This is going to accelerate the demise of retailers who do not have either competitive pricing or a standout store experience.'"
So, the system works? (Score:5, Insightful)
Be creative? Negotiate better wholesale costs so that you can offer your customers lower prices? If not, someone else will. Isn't that capitalism?
If a restaurant had better food, a nicer atmosphere and cheaper prices, wouldn't you frequent that place as well?
Re:So, the system works? (Score:5, Interesting)
If the fact that Wal-Mart is the only local place I can buy my clothes and groceries is a sign the system is working I'm not so sure I want it to work. I'm not saying we should regulate the hell out of everything but I really miss having other options when I shop.
Re:So, the system works? (Score:4, Insightful)
In the city to which I'm currently residing in Kentucky (you know, south of the Mason-Dixon, where all of those gun-toting conservatives people love to make fun of so much) there is a Walmart, at least 2 Meijers, several Kroger's, a bunch of specialty ethnic stores, a whole foods type co-op, along with both chain electronics stores and several specialty shops all over the place. "Other options" are doing just fine.
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In the city to which I'm currently residing...
See, here's the thing... you live in a city. Walmart primarily targets rural towns and works hard to drive every other business into the ground so that they can have a near monopoly on retail sales in that location. Sure, sometimes competitors come in like Meijers or Kroger, but usually only once a town reaches a certain size, large enough to be profitable for them. In many cases only Walmart's huge volume and cutthroat supplier practices make what they do profitable over long period of time. So in that reg
Re:So, the system works? (Score:5, Informative)
Anecdotes are great and all, but we're supposed to be nerds. Here are some studies:
http://www.newrules.org/retail/key-studies-walmart-and-bigbox-retail#4 [newrules.org]
Interesting findings from these studies show that most retail purchases at a Walmart (85%) have corresponding losses from local business, within two years there is significant loss of local businesses in general when a Walmart opens, Tax revenues generally do not go up, Retail employee wages and benefits drop as the result of a Walmart opening. Walmarts funnel nearly twice as much of the money running through them out of the local economy (out of the state) as local retail businesses do. One study found that for every job created by a particular Walmart studied, the local community lost 1.4 jobs as local businesses closed. Counties with one or more Walmart have higher poverty rates and poverty rates that increase faster than other counties in the same state and/or area, over a 10 year period.
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Re:So, the system works? (Score:5, Insightful)
I wouldn't go so far as to say that it's working. People are STILL pretty stupid. Have you noticed that brand markers and logos are getting larger and larger? This is because they are trying to convince the public that they aren't wearing clothes so much as they are wearing labels. (I would say they have been pretty successful so far!) So there's still plenty of room to exploit common consumer stupidity.
Re:So, the system works? (Score:5, Insightful)
You're the exception, rather than the rule.
For most consumers, they would rather buy a label, regardless of quality or price.
Many people find it hard to believe, but for the majority of Americans, purchasing a car is an impulse purchase. Accordingly, most Americans purchase a vehicle because of envy status (label).
As an example, let's look at Corvettes and Harleys. On the world stage, the Corvette is generally considered a crap, plastic car. It sells well in the US because of its American heritage and perceived prestige. The reality is, a much, much better car can be had for the money.
Likewise, look at Harleys. They consistently have extremely poor reliability ratings; especially when compared against the biggest six motorcycle competitors on the world stage. Yet Harleys not only sell very well, but frequently demand a premium price.
Both of the above examples are good indicators of how willing the American public is to pay a premium for an inferior product. So ultimately, regardless of actual quality, its all about label perception.
Re:So, the system works? (Score:5, Informative)
Now, you'll hear them retort today about how reliability is much better than it used to be, and it has gotten better, but it's still nowhere near that of basically any other brand. They are intentionally using an antiquated engine design with 1950s tech and marketing like anything more advanced "ain't shit". I mean, they are still air cooled for goodness sake...
HD is the greatest case of drone marketing in world history. They have a militant user base willing to pay a premium price for a product that is inferior in every quantifiable way. Not only this, but they spend trillions on cheap chinese trinkets just because they carry the logo.
It's not like the premium clothing outlets where the product is better, but not in proportion to the price. It's even greater than that.
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Re:So, the system works? (Score:5, Insightful)
I'm with you on this, and that is one of many reasons I try to avoid Wal-Mart. If the end game is that only one store is left in the race to the bottom on price alone, the end result is a total monopoly. At that point, the winning retailer (Wal-Mart) is no longer required to keep the prices low since there is no longer a competitive need. Of course, the free market capitalism evangelists would claim that another store is free to open to compete. The problem with that is the barrier to entry would be beyond any realistic capability and the competitor could be easily squashed by a short term price adjustment from the monopoly. The good news is that there are currently enough competing stores that actually beat Wal-Mart on some prices, quality, or convenience to keep that from happening on the national level. The problem is that those retailers primarily exist in the larger metropolitan areas and not in towns of populations below 50,000 where competition is desperately needed.
Additionally, the smartphone apps are probably shedding the light on the fact that stores other than Wal-Mart often have a better price on many items. That is something I had observed in comparing prices on groceries when a Super-Center threatened the existence of the local grocery stores in the town in which I previously lived. Just because a store says it always has the low price in its advertisement, it doesn't make it true.
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Just because a store says it always has the low price in its advertisement, it doesn't make it true.
I believe the slogan is actually "Always Low Prices" and if you ask me, that's very non-commital. Probably for that exact reason, so nobody can attempt to legally to hold them to having the lowest price.
Re:So, the system works? (Score:5, Insightful)
I've been wanting to start a competitor to Wal-Mart but you know, no capital. It'd be like Wal-Mart but more selective...
Wal-Mart sells some good stuff, but mostly crappy stuff; but for the most part all they do is play on price. I can get King Arthur Flour for about $3.50 for a 5lb bag there, which is a great price for the best flour I've yet found; although the bags look a little manhandled, and I wonder if they really have 5lb or if some's been beaten out of them in transit.... Wal-Mart pushes its manufacturers to reduce prices at any cost, suggesting ways to cut corners, get cheaper materials, even outsource to China; I dislike this, because they care nothing for quality.
What I want is a Wal-Mart like store that specifically tries to play the budget game, but on value terms. "Cheap as shit" is not value; "Great Value" brand food is the least costly food, but also the worst value. If you want value, you must spend a little more.. and only a little more.
When I buy clothes, I go to Sears. I pick out Land's End Business Outfitter's clothes. A shirt at Wal-Mart costs $18 and tears at the seams or develops fuzzy spots or holes after 2-3 washes; after 2 years, the $25 Land's End shirts I have aren't even discolored, much less fuzzy or tearing. One DID fall apart, a little... one of the seams wasn't finished right. I have had 8 of their shirts, that one was an oddity. I suspect performance of Polo and Doc Martin's clothes would be the same; Levis always made awesome jeans. By the way, pants at Wal-Mart cost about $22 last I looked, and Land's End pants cost $40 BUT I buy them on sale for $30, which happens all the time.
That's the kind of thing I would do for a Wal-Mart clone. We can't compete on price with Wal-Mart, but you aren't getting Wal-Mart crap. I'd skip the standard stuff. In the food section I'd only offer King Arthur and maybe some of the fine-milled flour I can get at the farmer's market in bulk (I'd talk to the farmers for this one). There's way better milk than the mass-market pushed crap; Trickling Springs Creamery makes EXCELLENT milk (it surprised me milk actually could taste better), and there are other dairies that put out cheaper but still better product than Leigh's and Cloverfield. Fresh baked bread is always good; there would be a bakery ... like at Safeway, you know, $1 baguettes and artisan loaves, bread is pretty cheap to make and can be done en masse for not too much labor cost (that $1 baguette is 25 cents of product and 75 cents of labor and margin).
Good food, better quality non-designer-brand clothing (not like $100 shirts, more like $25 shirts instead of $18 shirts), maybe stock some alternative stuff in the personal care section (Merkur DE razors, straight razors, brushes, DE blades; Dr Bronner's soap, etc, there's some not-Dial-soap that's not $4 a bar too; some higher end colognes that only cost $10-$15 a bottle...). I might tint the CD section... no censoring CDs, but aim for less mainstream material and more diversification (i.e. have Die Toten Hosen in the metal section, some Eurobands, some less-known names like Sonata Arctica, indie stuff and good mainstream), maybe with a suggestion box so customers can share their favorite no-name bands. CDs are easily accessible (Amazon), I'm not interested in pushing mainstream crap; the value-add service there is to have an "interesting" CD section, not a grocery section to buy radio songs and Top 10 hits.
I think it's a sad reflection of society that we have places like Wal-Mart that push "low low LOW prices" and sell absolute garbage. Everything there is either "what everyone buys" or "something we dug out of the trash" ... it's like a dollar store that's trying not to be a dollar store. They know they have to sell actual Oxyclean because the brand recognition is better than the $1 price tag on "Awesome Oxygen", same goes for dish washing liquid and motor oil (motor oil is actually important though). Gillette razors are so over-markete
Re:So, the system works? (Score:5, Insightful)
Hmm. Perhaps you could call it Target?
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it's because most buyers only buy cheap products at low prices and don't see any reason to trade up, that's a problem with manufacturer branding or value propositions though.
I pay $20 for 3 pairs of socks and I have lost a few and had to buy more... after 2 years. The old ones are slightly yellowed, but otherwise identical to the brand new ones.
After 2 months, Wal-Mart $6 for 8 pair socks all have holes in them and I need to spend another $6 for 8 pair, or wear something that's falling apart and pounded flat but wasn't really fluffy and luxurious to begin with anyway... you know when they show poor people on TV and cartoons and they're wearing falling apart shoes and their
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I work at a large business that often negotiates with vendors for the best prices. Ultimately not everyone will want to go to Wal-mart and would like to have choice. If the service was better, return policy easier or something else, but the prices slightly higher, it may be worth it for me to shop at Wal-mart's closest competitor. Leads to the "creativity" part of the equation.
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Valid argument, but see the part above about creativity.
Re:So, the system works? (Score:5, Insightful)
Admittedly not the way business is going these days, and this article is highlighting another nail in that coffin.
The very nature of capitalism requires steadily growing greed and want for larger profits. The only way a company can continue selling decent-quality products at realistic prices is if it has no desire to expand.
For some reason, "not expanding" is the same thing as "a business slowly dying", a concept which always eluded me. I mean, come on...if you're posting a profit, who cares if you're growing by 5% or 10% or whatever; you're still making a profit.
Re:So, the system works? (Score:5, Insightful)
You just hit on one of my fundamental disagreements with how the US economy now operates. Originally, when companies opened their stock for public purchase, the idea was to get a cash infusion to accomplish some objective (expansion, r&d, and so on). Those stock holders often received a dividend on that purchase. For instance they might have purchased stock at $10 per share, receiving a quarterly dividend of say $0.25. This essentially meant the investor often saw an immediate return on the investment when the company was profitable. In this case, a 10% return annually. This encouraged long term holding of the stock and a more stable stock price that didn't require dramatic 10% growth per year. If the stock holder held the example stock for 10 years before selling, the sale would be pure profit regardless of the stock price at the time of the sale. The problem is that a 100% publicly owned corporation gets very little benefit from the stock market once all of its shares have been bought up since the sales of its shares don't infuse new revenue into the company since those stock exchanges happen solely between 3rd parties.
Now stocks are bought and sold primarily for short term gains since most stocks don't produce dividends. The only motive there is the price of the share, which dictates that the company has to show profit growth. When a company makes a 3% growth in profit instead of 5%, the share price usually takes a significant hit, which is very illogical considering the company has actually improved its value per share. Wall Street now operates on totally unrealistic expectations of infinite 5-10% annual growth which is obviously unsustainable in the long term. This seems painfully obvious to me, but I never hear financial analysts discuss it on "news" shows.
Re:So, the system works? (Score:4, Informative)
True, but I'm referring more to large businesses. If a company makes $100 million in profit one year, and $150 million in profit the next year, but they were expected to make $175 million in profit, the market completely disregards the fact that they grew and their stock dives.
Why? Because they didn't hit some arbitrary expectation of growth? Because they were greedy, but not greedy enough? That's what I was referring to.
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Mmm creativity.
Step 1: Tinfoil, and lots of it. Metallic mesh for windows. If you're a mom-and-pop outfit, you may skip step 2.
Step 2: Just to be sure, jam the heck out of GPRS, 3G and 4G frequencies, provide free wi-fi on the premises but route wi-fi traffic through a filtering proxy. Make sure to also provide a micro-cell so you can filter SMS. If all else fails, start jamming voice traffic as well.
Step 3: Profit!
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I know you're being facetious but that isn't allowed under US FCC regulations. Cell jamming of any kind is forbidden.
Re:So, the system works? (Score:5, Insightful)
I regularly pay a little more for goods that I know less about if I got good service. As long as the price is at least vaguely comparable, being able to physically touch and try out something is worth a bit of money to me. Especially when it's something where the salesperson helped me look at options, understood what I wanted, picked the best value for me, etc, and didn't just hand me which one they were pushing that week.
Of course... sometimes the markup is too high. I really wanted to buy a TV locally, but they "don't price match amazon," which means that the same TV at amazon was $1500 less... you've got to at least make the same ballpark.
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Re:So, the system works? (Score:4, Insightful)
you've got to at least make the same ballpark.
Exactly, I just willingly paid $50 more at a brick-and-mortar plumbing supply place for a specific toilet that was cheaper online. For one thing, I could go over and pick it up immediately, and for another, I didn't have to deal with having a delicate thing shipped to me.
Re:So, the system works? (Score:4, Informative)
I did this recently with a TV at Best Buy. The sale price on the one I wanted was close enough to what I could find online.
I was able to actually see the TV, see how it looked, and spin the thing around to look at how the I/O ports are configured. I probably paid a little bit more than I would have online, but I firmly believe that the little extra cost is worth it to keep actual displays available at brick-and-mortar mortar locations.
Definitely did not by the extra high quality "HD Optimized" gold plated monster cables though. I might be a little altruistic, but I'm not a fool.
Re:So, the system works? (Score:5, Interesting)
I was able to actually see the TV, see how it looked, and spin the thing around to look at how the I/O ports are configured.
Having just helped my g/f buy a netbook at Best Buy, I'd highly recommend you do the same thing to the TV they actually sold you, which may not be the one on the shelf.
Seriously: the clowns at Best Buy tried to sell us the wrong netbook with the wrong battery at the wrong price. That was AFTER I had opened the box to check things and noticed a 25 Whr battery that was supposed to last six hours, spoke to the sales-person about it, who spoke to the "Geek Squad" clown about it, who assured me that advances in battery tech and power management made it totally plausible that it was the right battery.
When I realized the price was wrong on the bill I got the sales clown to bug the manager who tried to blow me off. I then pointed out the model number on the bill was different from the one on the self and the manager claimed the last four digits were only for colour. I leaned on them (politely) and got them to look up the model number online, and lo and behold it was rather more than the colour that varied with those crucial last digits.
So a computer-literate, physically imposing man who has been described as 'forceful' in performance reviews was just barely able to get the correct product out of Best Buy. I can only imagine what the average person goes home with.
The best thing: after all this my g/f decided to buy a carry-bag for the netbook, and they charged her the wrong price for it (she went back the next day and got it reduced to the posted price, and they immediately pulled the posted price off the stand...)
I've had pretty terrible experiences with TigerDirect, who have great prices but really annoying follow-up (endless calls from salespeople). But I'd gladly buy from them if it meant never having to set foot in Best Buy again.
Re:So, the system works? (Score:4, Interesting)
Amazon, Newegg, ZipZoomFly. There's no reason to ever look anywhere else IMHO. Excellent service and prices from all three. TigerDirect and Buy.com are on the avoid list.
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The premium you pay is more like a warranty of sorts. Someone/something is more accountable than an invisible mega-corp who mysteriously ships things to you.
Have you ever had an Amazon shipment not show up? It's horrendous trying to get your money back (or a new set of items). Amazon blames UPS, UPS blames Amazon. It sucks hard. It takes weeks beyond what you wanted to wait.
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basically, they're saying that people who do a shitty job are going to fail faster, which is an overall good.
the people who do a good job are also going to succeed faster. So this means that brick and mortar shitstores like best buy will hopefully go out of business (and good riddance)
"To improve your shopping experience, (Score:3)
this store is now a cell-phone free environment."
There. If I predict it, it will be less likely. ;-)
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this store is now a cell-phone free environment."
There. If I predict it, it will be less likely. ;-)
This is exactly why you don't want places like theaters implementing phone jamming devices. Once it becomes 'acceptable', doing it at a place like Best Buy gets lots easier.
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Cool. I'll just leave the cell-phone outside. Along with the pocket it's in, and the ass those pants are on.
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Yup, so you cant complain when the only store you can shop at is Walmart.
Walmart can buy 8000X more volume than any other store can so they can undercut everyone.
Fortunately most american shoppers are horribly shallow and dont care most about price but trendyness..
Abercrombie torn up jeans at $150.00 and a Aercrombie Sweatshirt that is lower quality than a Fruit of the loom but says "ABVERCROMBIE" on it and costs $65.00 compared to $19.00 is far more important.
I gotta look like I have money.... Oh and can y
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All the cell phones are doing is adding to the efficiency of the market. And most economists would agree that this is a good thing. Retailers that profit by inefficiencies in the market are doomed to failure eventually, at least if you believe in free market principles.
One advantage that retailers will have for the foreseeable future is in letting the customer experience the product prior to sale. That's a big reason why the Apple company stores are such a good idea. And the reason why Target recently re-di
Re:So, the system works? (Score:4, Interesting)
I recently bought a book as a Christmas gift for one of my family. It's a best-seller in hardback, and it cost me nearly twice as much in my local bookstore as it would have cost me from Amazon.
On the other hand, it is in pristine condition (unlike the last books I ordered from Amazon, which were significantly damaged due to careless packaging) and it is here (unlike my order full of Christmas DVDs from Amazon, which is now five days overdue, and my other half's similar order, which is now more than a week late).
The trouble is, if most people start checking books out in the bricks and mortar stores but then buying on-line, the kind of crappy service I have received from Amazon lately will be the only option, while the reliable and helpful service provided by my local book store will go the way of the dodo because offering those benefits to potential customers does not directly generate profit. I'm not sure what the answer is, but a pure-capitalism, only-the-price-matters approach certainly isn't it.
Re:So, the system works? (Score:4, Informative)
Even back home going to the bookstore means driving half way across town.. I consider the traffic part of the "crappy" experience of buying local along with the lack of selection, the line I have to stand in to by the book, and the musac I have to listen to.
It's a dead argument anyway, I've bought a Kindle and I'm hooked. So the local bookstore as well as the Amazon hard copy book section is pretty much dead to me. In the past two months I've "purchased" and read nearly 70 books. Prices ranging from zero all the way up to about $10 and had them delivered within minutes.
The only downside so far has been the destruction of my first Kindle in my backpack. (The corner of a table caught it square in the middle of the screen.) The second one was bought along with a cover and a armored storage box.
Re:So, the system works? (Score:5, Insightful)
Capitalism is about the best value, not price. For you, that means shopping at a local B&M. Like the last sentence of the summary says, retailers need to provide a better experience to prosper.
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The trouble is, nothing stops the phone-wielding shopper from enjoying any better experience that might be offered by a local book store, but still giving their money entirely to the cheap on-line supplier anyway.
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When i was a child, books were 2.00 and 2.25. Gasoline was 88 cents. Electricity was 6 cents a kilowatt hour.
On that baseline with inflation, books should be about four to six dollars. They are eight dollars and some authors like Rowling are billionaires.
Books have gone up faster than inflation for successful series. They are currently overcompensated (a successful author shouldn't be a billionaire if we have an efficient market).
Since there is a glut of entertainment, I've mitigated this by starting wi
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Re:So, the system works? (Score:5, Insightful)
The chains don't have a good supply either. You can find book #4 and #7 in a popular series, and anything else they will be happy to special order for you. But if I'm going to be ordering and waiting for things, why shouldn't I just do it myself online and save some money and avoid having to drive back to the store?
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At that point...I could really see the advantage of going to try an item on in a store, seeing which size fits, scanning the barcode into amazon and having it show up in my office the next day (its not like I was going to wear it out of the store 99 times out of 100).
This is abusive of the retailers since I would expect
Re:So, the system works? (Score:5, Insightful)
I'll be happy with better food and nicer atmosphere. I don't expect the sit-down Italian place down the road to be price competitive with McDonalds. I expect to get great food, really good service, and a more enjoyable experience.
One thing that has happened that a lot of people don't like to talk about is that a lot of sub-par small businesses have also shut down. If the sit-down Mexican joint was the only place in town and everyone was used to it, then a Chipotle moved in next door and offered food that was 95% as good for 40% the price, you'd expect the more expensive one to suffer. In many small towns businesses have stepped up their game to actually offer those things that makes them stand out - better service, better focussed selection, etc. In others, people realized that what they thought had been good pricing/selection/service actually wasn't.
Of course, many fine businesses have been hurt as well because people will accept 50% of the quality for 90% of the cost. But that's not the whole story.
Great! (Score:5, Insightful)
Fine by me.
Good riddance.
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A true monopoly is one where no one else is even allowed into the market, such as our crapy phone, cable, and power systems, which are backed by the force of law, or in situations where the last one standing can prevent anyone else from competing.
That is not the case in retail.
If Walmart manages to wipe out everyone else and then starts jacking up the prices, competitors will start springing up all over the place with time for
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But you act as if no one else can open a store again once they are all gone.
A true monopoly is one where no one else is even allowed into the market, such as our crapy phone, cable, and power systems, which are backed by the force of law, or in situations where the last one standing can prevent anyone else from competing.
That is not the case in retail.
If Walmart manages to wipe out everyone else and then starts jacking up the prices, competitors will start springing up all over the place with time forcing them to either become the price leader once again or be wiped out themselves.
Heh. If we all opened stores at the same time, maybe. But if you're going up against Walmart, a multi-national, in the environment that the GP post described, you'd better have deep pockets. If not, they can drop their prices down below cost (actually probably to above their cost but below yours) until you go out of business. Hell, they could just give stuff away until you ran out of money, and make it all up as soon as you closed the doors. The long periods without competition would make up for the sh
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Fine by me.
Good riddance.
You do understand that small stores cannot possibly compete on price with the likes of Walmart et al, right? It's not a question of greed or a lack of will, it's simple economics. In a world where only the lowest price store could exist you would only have a couple of companies in that sector, period.
And we all know what happens when there is a lack of competition...
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And that's where A Standout Store Experience comes in, if you're only willing to stick it out and read the last quarter of the sentence. Small stores need to have helpful, knowledgeable staff and excellent customer service; enough so to engender extreme customer loyalty.
In completely unrelated news (Score:5, Funny)
Retailers soon to petition FCC to allow cell-blocking technology in private businesses.
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That would never be permitted in public stores, people would stop shopping in them or stop buying as much and rush out of the store sooner, destroying whatever advantage the store gets for erecting a "wall of ignorance".
What if there's a family emergency? What if your kid got hurt at school? You simply can't screw with mobile connectivity anymore, it's too important.
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I did this (Score:5, Informative)
I used my phone to find the best prices when I was buying various white goods (fridge/freezer, washing machine, dishwasher) upon moving house, from a certain UK big-box electrical retailer.
Of course, the salesperson said "Oh no, we can't match internet prices" but it turns out that given a choice between a discounted sale and no sale, they can
Protip: You haven't got the best price until the salesperson has sheepishly had to ask the manager for authority twice.
Re:I did this (Score:5, Insightful)
Comment removed (Score:5, Interesting)
Re:I did this (Score:4, Interesting)
If I was a sales manager, I would be offering some incentive to my customers to do all their shopping at my store at once. The more they spend, the greater their savings.
See, that's what's gone away: Any reason for customers to have store loyalty.
It used to be that you could actually get discounts. Nowadays, they can offer discounts for exactly one reason: price matching.
Sure, there are those customer loyalty cards, but the free ones are clearly just privacy-invading discounts that should already exist. You're not given a discount for being a 'good customers'.
The ones you have to buy, like bookstore ones, are a manual discount, which is just as idiotic. Those things should be offered free after someone's bought $30 or whatever. Or, even better, offered free, but with no discount, and as you buy stuff using them the discount gets larger and larger.
The only place you get actual discounts for actually buying stuff are those places that punch the goofy cards, which appear to somehow be the lowest rung of discounting. (And airlines have some sort of frequent flying thing too, which I don't know much about. Normally people when talking about 'frequent flyer' inexplicably mean 'stuff out credit card company gave us', but I'm sure there's some actual rewards from flying a lot.)
Other than that, no one offers any sort of discount, which is ironic, because they have more ability to track you than ever, and hence could easily offer customers discounts. They don't even need cards. At checkout: 'I see you've purchased more than $80 this month. If you total more than $100 by the 31st, you get $10 off, so next time you're here, you can get $20 and only pay $10.'
You're doing it backwards, you idiotic resellers. Stop invading privacy against the customer's wishes. Just offer them an actual discount for loyalty, and actual discount based on them being good customers, not a pretend one by marking up prices and then pretending to 'discount' them because someone filled out a stupid card, which people see straight through and, um, doesn't encourage any loyalty. At that point, people will start making sure that you know how much they've bought there. You set something like that up, and forget needing the customer cards...people will deliberately link their credit cards if they're using multiple ones, and tell you their actual name and address. (Not the 80% fake address the 'customer loyalty' cards have.)
And that's just the 'general discount'. It used to be that if you bought a X, you could get X accessories for cheaper at the time, which encouraged people to buy all their stuff at once. Now half the time X is a loss leader and the accessories are marked up 300%. (I'm looking at you, Best Buy.) This is insane.
The only store that gets any sort of store loyalty from me is Barnes and Noble, because I'm afraid if I don't, actual physical bookstores will cease to exist. B&N has it sorta right, in that they keep mailing me coupons (Which I actually do use.), but it seems they're just mailing them because I'm a member, and not because I've bought things per se.
Until companies start actually rewarding actual purchasing and actual loyalty, there is absolutely no reason for customers to be loyal.
Re:I did this (Score:5, Informative)
I used my iPhone and the Red Laser app to scan all the toys my kids wanted. It shows all the prices for the stores around me, as well as online. I got approached by at least one sales person asking me what I was doing, and Toys R Us specifically was not happy. I got approached by a floor manager after the sales person approached me, and he asked to see the app. He looked none too happy. Why in the world would I not check if I had the ability??
Can you at least understand why he wasn't happy? If you want to use his floor space, play with his display models, and take advantage of all the other "free" services a bricks and mortar store provides, you should make your purchases there as well. Otherwise, do your research online and buy wherever is cheapest - that's fine too. Its just common decency.
Re:I did this (Score:5, Insightful)
Look, people shop around, they did before the internet, and they did before mobile phones. There is nothing any retailer can do to stop this.
Being grumpy at a customer for using the tools at their disposal to shop around more efficiently is simply driving that customer away. Treating your customer with respect, on the other hand, *might* make you a sale even if your prices aren't the absolute lowest.
A sales person calling over a supervisor to bother a guest in their store for price shopping is extremely disrespectful. You call over a manager for suspicious activities, or clear violations of posted store polices (non-service pets, inappropriate clothing) NOT because you are worried the customer might find out you don't have the lowest price and go shop elsewhere. They might have passed on a product at your store due to price, but now they almost certainly will because you harassed them. How is that a win for your store?
Used this at HHGregg before (Score:2)
and I am going to try it again this year. Amazing what prices they will match when it comes to getting a sale. This year I need two 42 LCD televisions, they want 699 whereas I can get them from a certain major online retailer wants 599 and others 589 with no tax or shipping costs.
Will be curious what price they will go down to.
Uniqueness (Score:4, Informative)
Most stores sell the same things that are found everywhere. The most profitable stores are often specialty, where there's little option to find a product elsewhere. In the long run we might see more manufacturer stores, bypassing the generic middlemen. E.g., Apple.
+1 Rationality (Score:3)
Awww. Store can't bamboozle poor customers with flashy displays anymore?
Books (Score:3, Informative)
If I walk into a store and something is $30 and it's $27 online. I'll probably just buy it right there.
But the other day I went to get a book from Borders and it was $30 in the store and $15 online. For that I'll just buy it when I get home.
At Barnes & Noble the in store price for something like Rosetta Stone is $600, but it's $450 online.
(I think everything is just 20 to 30% more expensive in the store.. regardless of size/weight/etc.
Re:Books (Score:5, Interesting)
This reminds me of the results of a survey. People were asked "If you found out that this $100 piece of software were only $50 across town, would you leave this store, drive across town and buy it cheaper?" The answer was almost always less. Others were asked "If you found out that this $1,000 computer were available for $950 across town, would you leave this store and by it cheaper?" Fewer than half said yes.
So why is the value of our time less for more expensive products? It seems people are fundamentally illogical. Yes, I know... I must be new here.
Re:Books (Score:4, Interesting)
People working with large numbers deal in percentages and proportions. It's how our monkey brains try to handle values that are so much larger than anything we were designed for.
There's also the question of worth. Something that is only worth $50 might not be worth a purchase of $100, but something that is worth $950 most likely is probably still worth $1000 to someone.
This is, of course, why the most efficient use of your time for most people is in negotiating a better deal on your car or your house.
Re: (Score:2)
Re:Books (Score:4, Informative)
You are 100% spot on. Going through a marketing class you see folks have spent years studying these psychological facets and know how to take advantage of them. As humans, we are not 100% rational, present company included.
I tend to be more rational and less materialistic than most (more of my money goes to schooling and charity than I spend on everything else combined) yet I see myself fall into some of these traps.
So while I never intend to be in marketing, it is good to know how the enemy thinks :)
Re: (Score:2)
Personally, I don't want to be taken for a ride. In the first case, the store has over 100% markup, which offends me if another store is able to sell it at a much lower price. I'm not only likely to go to that other store, but I'm likely to stop shopping at the first one.
It's not about the flat savings, it's about overcharging.
Re:Relative Savings (Score:3)
I'll chip in the the "rationality of the decision". Someone deciding whether to change their habits on $50 vs $100 is indicating they are concerned with the overall effect of the purchase on their budget. Someone making a capital investment of $1000 for a computer shouldn't be worrying about where their next necessity purchase is coming from. It's like the famous joke "I'll take 2 Angus Bacon Cheeseburger meals, supersized, but make the drinks diet coke because I'm on a diet".
Re: (Score:3)
It is a perfectly fair comparison. In fact, this info comes from a marketing class and is used as an example of how you can use psychological games to get folks to pay more. No... this wasn't the exact term used in the class... terms like "price discrimination and segmentation" are used.
But the bottom line, the rationale you are citing is used by retailers to extract more money out of you than you logically should.
When you get home? (Score:2)
pfft.. order it standing there?
Perfect market? (Score:2)
Best buy? (Score:2)
Best buy has qr codes on a lot of their price tags. How do they figure people to use those without a smartphone.
Re: (Score:2)
Wouldn't it be ironic (Score:2, Insightful)
Wouldn't it be ironic if later stores started banning phone use in stores?
Re: (Score:2)
Yeah, what's next? Movie theaters banning bringing food and drinks from your home? Hollywood telling us that we can't format-shift the DVDs we buy?
And Nothing of Value was Lost (Score:5, Interesting)
Stores can no longer use tricks to get me to spend my money there, and I'm okay with that.
I actually bought an iPod case at Best Buy the other day for $11 knowing it was available on Amazon for $7. The brick-and-mortar shopping experience is still worth it if I want something now or doing what to worry about paying for shipping (usually I buy *more* than I need at Amazon for small purchases to qualify for free shipping).
At the end of the day, the customer wins. The best stores win. And crappy stores lose. This is a good thing.
Stores? (Score:2)
This actually isn't all that good (Score:2)
Self Price Match (Score:5, Interesting)
Re: (Score:3)
Maybe you should have tried a little harder. Best Buy is supposed to match their website prices. There was a huge ordeal a while back on how their in-store computers were showing different prices on their own website so they didn't have to match the lower price on the internet facing one.
Total price and instant Gratification (Score:3)
Yes it may be cheaper online, but don't forget to add the shipping cost. Not all places offer free shipping and sometimes there's a minimum amount to spend to get the free shipping, etc. Don't forget cross-border delays and charges or you'll be shockingly sorry. Especially those brokerage fees, which often are more than the shipping cost added with the customs fees.
But where the physical retail stores still have the advantage is in how fast you're getting what you want, if they have it in stock.
With these two things in mind, the only difference is that you can compare prices with other nearby physical stores without actually having to drive there to check the prices. The real competition is still the other stores, nothing really changed if you want something "right now".
Re: (Score:3)
I'm guessing you never ordered anything outside of the USA.
For us Canadian, ordering from the USA usually results in our order being hold by customs, delayed for a day or two, then having UPS charge us brokerage fees of 35$ on top of customs fees of 10$ and UPS own 25$ shipping cost.
Re: (Score:3)
I'm a prime customer too - got to say, I'm a big fan. Just got a mattress (a mattress!) delivered. Two days, no charge. Sheesh...
Re: (Score:3)
My phone saved me just the other day... (Score:2)
I got on the website, researched exactly the TV I wanted, checked stock online, and headed in to actually buy the thing. It was a 42 inch LDC for a very nice price, and they had eleven of them in the store. When I arrived in the department, I couldn't find any on display. I found the 42 inch LED, but it was close to $200 higher. I asked the sales guy, and he said they didn't have the other one, but the LED as better anyway. I made him look it up in the computer. He wasn't happy, but I eventually got t
What they are really saying... (Score:5, Insightful)
"We are afraid now that customers can figure out we are cheating them with false advertising, before we manage to snatch their money."
Devil's advocate (Score:5, Insightful)
It's a good thing to give the customers more transparency in who they do business with, but I am concerned that this will reduce competition even further to price warfare. Quality, safety, environmental sustainability and the welfare of employees may take even more of a backseat than it already does.
Needless to say, this transparency is not the root cause or a bad thing. However, with shoppers caring more about price than anything else, it is vital to regulate industry and retail to ensure that companies do not rape their people and the environment to stay competitive.
Black Friday Markups (Score:3)
It's a balance. (Score:3)
I have, on a couple occasions, used my smartphone to price-compare when in a retail store. Both times were at local, non-chain businesses. I like to visit a small shop when possible, because usually the owner or manager is present.
On both occasions, I very politely explained "Hi, I like this item and am hoping to buy it here. I was able to use my smartphone to compare prices. Some retailers will price-match Amazon (etc), who has this for $X. I can show you if you like. Would you be willing to match that price please?"
Now, here's the thing. I get that small businesses don't get the same wholesale pricing as Amazon. I'm not really demanding an Amazon price match. If they weren't willing to budge at all (especially if it's more than a 10% difference), it's possible I would walk. But, even if they met me halfway, I would still be happy to do business with them.
I think the idea of always paying the "asking price" is a very American cultural phenomenon. In Turkey, for example, it is literally expected that a customer will haggle for at least a 10% discount. It never hurts to ask, politely!
Online does not offer everything (Score:3)
You can't find everything online, or discern it from all the other unwanted crap that shows up in a search for a popular high-turnover product category.
Try finding a particular Sony camcorder battery online. All too often you'll get flooded with wrong models, crappy knockoffs, and otherwise have difficulty finding what you want. Easier to walk into a big-box store and pay a bit more - you can confirm its not a POS cheat, and can return it pronto if it is.
A smart retailer will recognize what customers want, want now, and will have trouble locating online. Yes, the nature of brick-and-mortar must change ... for the better.
Shops - Showrooms (Score:4, Interesting)
Are we part way through a transition from shops being where you both browse / research products and purchase them, to separating these two phases of the shopping process.
The way I see it there is still a need for bricks & morter 'showrooms' where you can go and compare products side-by-side or even try them out in real life : e.g when buying a netbook / laptop, I always go to the local PC world or similar to try out the different keyboards and see how the displays look.
However to make the purchase, it is clearly more efficient and therefore cheaper to sell through either giant mail-order only warehouses (e.g. order from amazon, or order direct from the manufacturer) or something like Argos for when you want to be able to collect it yourself same-day.
The problem is how the showrooms get payed for? will we move instead to individual manfactures paying for showpiece storefronts (maybe Apple stores already are this? do they expect to make a profit on on-store sales, or are they just giant adverts driving their sales through other channels?)
The current middle-ground that retailers seem to be using is the online 'reserve and collect' - but they still tend to be keeping the much of their stock on the shelves rather than having it all more efficiently stacked away in a warehouse out the back.
It can also go the other way (Score:5, Informative)
I'm in the market for a new TV, but haven't done any research. I see a TV in BestBuy that is on sale, compare the price to other stores, see it actually is a good price, then buy it. If I didn't have my smart phone, I would've gone home and did some research first, rather than buy it right there. That means I'm out of the store, and that most likely means a lost sale for them.
Similarly, I was at a (plant) nursery this last spring. I had the impulse to buy some plants for my house, but since I have a cat, I wanted to make sure I didn't buy a plant that was poisonous to cats. I whipped out my phone, went on the web, and researched the plants I liked, one-by-one, to find the ones that were cat safe. In the end I bought $100 worth of plants. If I didn't have my smart phone, then I wouldn't have bought anything.
evolution in action! (Score:3)
Indeed, this is exactly how i shop. In Canada, the largest book chain is Chapters/Indigo - and they have a distinct error in strategy; they have made it policy to only sell books at the publishers recommended or listed price on the book. Now, everyone else in the book business sells at a discount, or with sales, etc., but not them - and another critical error, is that they won't match prices. So while i'm in their store, enjoying their starbucks coffee and free wifi while parusing their shelves, i'm logged into amazon.com (in the US) and "adding to cart" all the books i like. - before i've left chapters, i've ordered all the books i like from amazon at a huge discount (sometimes 50%) and have already received their order confirmation. It's great! although, not so good for chapters.
evolve or die!