Sale! Sale! Fail!

A huge shift in buying habits and trends in shopping has resulted in many retailers falling into a very bad habit of teaching their customer base to wait for a sale prior to a purchase being made. I have seen this habit become the downfall of many small to medium sized American and Canadian retailers as well as having a hugely negative effect on the struggling department store sector.

Many more retailers have also fallen victim to running the never ending sale, in which unrealistic manufacturer’s suggested retail prices are prominently displayed and offerings of a permanent 50%-70% off that price are shining brightly. This pricing concept is becoming less and less effective for retailers as a smarter consumer base is evolving, loaded with knowledge and information simply not available to them prior. Many of these consumers not only know what the average price of a particular product may be prior to entering a retail store, they may in many cases know more about the product itself than the staff selling it.

It doesn’t matter what you sell in today’s market, if you still choose to make it all about price, you are in big trouble. Sooner or later, someone or something will come along and pull the price floor out from under your entire industry. You have to have a stronger strategy in place for the success of your business other than your never ending sale philosophy; it will be the end of you and your company unless you change.

So where do you go from here? Great question, here are a number of strategies that are working for some very successful companies in today’s environment.

  • Specialize in your product mix. Become very clear on what you sell and become an expert on the type of client you service.
  • Focus on you. Stop trying to keep up with, or caring what the guy down the street is doing, mind your business and become the best at what you do.
  • Respect your customer’s intelligence. Stop insulting them with exaggerated regular prices offered at steep discounts. MSRP has become a joke in modern retailing. The sooner you drop it from your repertoire the better.
  • Create a true one price system for your product mix. Have it represent the selling price of your product accurately and fairly. More and more consumers are turned off by old school propaganda and manufactured confusion. Keep your pricing clean.
  • Retail is detail. The fact is your customer may have as much detail on your product as you and your staff do. Be sure your team knows their stuff.
  • Stop running never ending sales. If your product is priced right from the start, it will sell if you have the right team in place. Reserve having a special sale for a special time only. IKEA is an excellent example of a company that has only one or two big sales annually.

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