Overcoming The Pressure on Price

The biggest concern of brick-and-mortar retailers is pricing pressures caused by discounting competitors and online etailers that don't seem to care if their retail operations make money, e.g. Amazon. According to a April 2018 study by Retail Systems Research, 58% of brick-and-mortar retailers claimed their top challenge is keeping up with their competitor's pricing. 

Department stores that constantly discount (i.e. Macy's), the advent of electronic coupons that flood consumers' inboxes daily and access to comparison pricing online has created consumer expectations that they should never pay full price for anything.  The study also found that pricing pressure is more severe in some sectors than in others.  Fashion and apparel retailers were more likely to be focused on pricing pressures and minimizing markdown spending.  More than 33% of Internet users worldwide reported that they receive a promotion at least once a week for a product that they would have paid full price for, reports a survey by Revionics and Forrester Consulting. If you automatically offer discounts, how many of your customers would have expected to pay full price?  As Pogo (a cartoon character from your editor's childhood) said, "we have met the enemy and he is us."

 

How do you avoid pricing pressures?  Offer unique products.  Provide a level of service that can't easily be duplicated by others or focus on specific lifestyles.  Restoration Hardware is a great example.  Restoration Hardware's go-to market strategy is to tap into the aspirations of its customers.  Every customer wants to receive good value.  How you convince your customers that you provide them the best solution for your project is to focus on their aspirations and by earning their trust. Need strategies to accomplish both of those goals?  DPHA is here to help.  Make sure you go to Rob Phibbs' workshop at the 2018 DPHA Annual Conference.

 

In Jacksonville, Phibbs will explain how to transform your corporate culture from one focused on tasks to one centered on the customer.  Well-trained team members can easily explain how a new bath will make clients feel every time they cross the threshold.  There are compelling reasons why a prospect will visit your showroom. The fact is that most consumers tell you they want to be left alone, but the reality is they don't.

 

Phibbs states that survey after survey over the past two decades reveal the inability to receive a greeting, prompt service, or finding an available associate are the most frequent causes of frustration for shopping in a brick-and-mortar store.  When you know how to approach a customer, ask the right questions and actively listen, you earn trust, because you demonstrate that you genuinely care about customer needs.

 

Thought for the day - Did you know that Millennials are more than twice as likely than Boomers and Gen X to say that interacting with knowledgeable sales staff influences their purchasing decisions?