Lisbiz Strategies: Is the future of retail all about the cheapest price?

Home Columns Lisbiz Strategies: Is the future of retail all about the cheapest price?

February 29/March 7, 2016; Volume 30, Number 18

By Lisbeth Calandrino

Is retail all about sales, coupons and more coupons? This past holiday season was certainly indicative of that mindset. As I walked through Bed, Bath & Beyond, I noticed people with fists filled with coupons. Target seemed to be the exact same way; everyone was looking for a deal. The lines leading to the cash register in Marshalls were through the clothing department. Forget about Black Friday; during the holiday season, every day had to feature a humongous sale. Now Cyber Monday added to the mix. It’s all about deals.

How long before brick-and-mortar stores can’t compete? They are all starting to feel the pinch; all except for the high- end discounters.

Every year around the holidays I sell products for all kinds of manufacturers during events that attract lots of people such as grocery store openings or car shows. This past December I sold Keurig coffee makers in Bed, Bath & Beyond. People on smartphones were snapping and clicking away, taking photos and visiting to see if there were cheaper deals. Apparently, consumers can’t get a big enough discount in-store. Despite their liberal 20% coupons that you can use “before or after the purchase,” consumers are beginning to be nightmares. Bed, Bath & Beyond will even take back old appliances and give you credit.

While there seems to be fewer impulse buys, I noticed if you told a shopper that a particular item was terrific, such as a 20-pack of Junior Mint Hot Cocoa, she would buy it. I sold 17 boxes my first day. I even sold a large Crock-Pot accidentally after telling the customer it was the best one we had.

I recently ran into a salesperson from a high-end women’s shop that I often frequent. She is an experienced salesperson who knows her stuff and knows when to push. I asked her how things were going and she replied with an interesting comment. “Our older customers with money aren’t shopping as much, and the younger ones don’t have the money nor do they seem to get as dressed up.” This is discouraging from a woman who really knows what and how to sell.

What does this say about the modern consumer? They are all looking for deals and willing to wait it out or order it online.

“It’s all about marketing,” said Greg Incardona, vice president of Follow Your Customer, a customized email marketing firm. “Kohl’s continues to mark down items every day. In order to get the item at the right price you have to be there at least once a week.”

I went into Target to check out the prices and deals. The clothing was 40% off so an item that originally cost $40 was on sale for $24. In my mind $24 wasn’t a sale price; it is what the original price should have been. I checked with several customers about my thoughts and they all agreed. When I asked why they were shopping at Target, they said it’s because of the sales.

Bargain shoppers know Marshalls and T.J. Maxx are the places to go. Customers I spoke with said they offer real quality and discounts. Their prices on the front end are cheaper because the designers don’t have to take them back if they don’t sell. Their brand advertisers pay for the marketing and everything is high quality.

I guess some facts about shoppers haven’t changed. They want attention and love when salespeople are excited about the products they sell. No one seems to tire of the “mark it up so you can mark it down” game.

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