There’s nothing more relaxing for me than a Saturday morning with the newspaper and a long macchiato (coffee snob). It is the one day that I generally refuse to work but today I felt compelled to blog after reading a piece in The Age newspaper titled ‘The app crisis alarming retail’. It was a good read but it will most certainly generate fear among retailers (as if they weren’t scared enough) and with fear often comes hasty decisions.
Yes, the growing adoption of smartphones and the subsequent use of barcode scanning technology to compare retail costs is a worry for the retail industry. But I would like to point out that what this mobile technology, often working hand in hand with social media essentially does is it connects us all. In this instance, we have the ability to tell people all over the world what price you saw a product for, leaving no room to hide for the retailer.
If you want to compete on price and price alone, guess what, you’re heading one way fast.
The Age article opened with highlighting the move by online retail giant Amazon to empower millions of customers to go out to the retail market place and scan prices, in return for very small discounts on their own platform. The objective was to build a massive database of product prices to increase their ability to consistently highlight their own cost competitive products. Think about doing that before the smartphone. I bet as a retailer you’re probably still sending staff to your competitors to check out their prices so you can set your price point accordingly.
It is a new era, there’s no escaping that.
I digress, if you want to compete on prices and prices alone then you’re in for a rude awakening over the next couple of years. These advances will not go away and our ability to connect with the wider community of consumers will only improve. What happens when we all start comparing prices? Well, the big boys win because they have the buying power and the infrastructure to beat the smaller retailer every day of the week.
There’s nothing worse than someone that points out the problems without providing a solution is there?
I don’t have all the answers but I would like to express my strong desire to retailers all over the globe – do not focus on price. Each and every purchase decision we make as consumers will be influenced by a set of values, sometimes more than the next but it is a set of values including price, perceived value, peer recognition, accessories, service, etc. Be competitive on price but don’t cut your margins because you’re afraid to match Amazon and the like. The two obvious values that the online retailers can regularly beat you at is price and convenience, so move on and try and provide your customers with which they are limited – Service is certainly one of these. Then use the technologies available including social media to encourage your customers to talk about how good you are at customer service, etc.
Quentin Aisbett is the strategist at OnQ Marketing. He loves social media, SEO and mobile. Blogging all the time, tweeting even more so and found rambling on Google Plus at+Quentin Aisbett. Be a little old school and email him.
