Do The Deals Ever End?
The power of the Internet’s always-on connectivity has reduced product prices, shuttered brick-and-mortar retailers and decimated MSRPs. Barcode reader apps, like Red Laser, offer instant access to the lowest price and special deals from a multitude of competitors. Consumers have opted into thousands of brand-exclusive networks and social groups for instant discounts.
If that’s not enough to strike a sense of hopelessness into the hearts of CE retailers, all types of specialdeals are pushed around the clock to mobile devices and then spread with viral intensity to social networks and other empires populated with millions of “friends.” On top of that, Showrooming pushes the lowest price to consumers at the last three feet of the sale, forcing retailers to try and match whatever deal the cloud offers at that particular moment. Shackled with hefty SG&As, retailers must find new ways to compete, increase margin, elevate customer satisfaction and draw traffic.
Increasingly, purse-proud consumers will continue to seek out and embrace smartly pulled and pushed prices offered at the cash register clouds. At the same time, though, CE retailers, e-tailers and brand vendors are busy exploring new sales and marketing opportunities to leverage this paradigm shift.
Here are some of the competitive push-pull pricing initiatives independent and regional retailers face today. While these strategies may seem daunting, retailers of almost any size can adopt pieces of them to fit their budgets and resources.
Group Buying: Millions of consumers now exercise their collective buying power through a host of cloud and social networks like Groupon, Living Social, GoNabit and DailyDeal. Even Walmart uses Facebook to run group buying deals, gathering tens of thousands of “likes” to make sales happen within 24 hours.
Flash Sales: These are all about time-limited offers and are mainly focused on dumping excess inventory. Many companies have successfully garnered instant sales and profits using Twitter or Facebook flash sales programs. Flash sales are a shiny starter key that canturn over the revenue and profit engine again and again.