If internet revolution has opened doors to many wonders, it has locked gates on some as well; price power is one of them. As the sentient customer refuses to accept the price that a retailer is offering by digging other online stores before coming to a suitable price, hoopla has ensued in the market as the price power, like quick sand, refusing to stay in the closed palm of the retailer is slipping out, making him jittery and unsure.
Well, we always wonder, how can a particular retailer offer his most expensive products in sale and at a much slashed price? The truth of the matter is that that’s the price which is appropriate and was kept under wraps as he cashed on on the market climate and made huge profits then. And when it reached a saturation point or more similar kind of products flooded the market, this washed off the reigning price and the retailer started selling the same for less(in discount or on sale). And once this news was out, the alert customer started digging deep and under the surface to have a peek of the most lowest and deep discounted price of the retailer to save himself from coming in his “high price trap”.
Here, one can afford to be a bit sympathetic towards the retailer who has a huge cost in front of him by way of retail rent, electricity, AC bill, employee salary etc. But at this, the ruthless customer will still argue, “Why should I get lost in the hullabaloo of his problems. If I get the same product at a lesser price on the internet which has various online websites, I better buy from there.” Hence, in keeping with the rigid attitude of the customer, the retailer is left with no other option but to explore ways day and night to counteract this problem in trying to reinstate some kind of control on his price, if not total.
A few tricks to catch hold of the evading price power:
Join the bandwagon
Coupons and special offer sites are a boon to the customers as they get everything there and in the price they want or even lower. So, it will help to surf these sites and compare the prices with yours. This will give you advantage of a competitive price policy. Also, keep your eyes and ears open to what is new on online sites. Have an online store of your own to give no reason to the customer to escape. Lace your sale with coupons and discounts to keep him tied to the site. If you become more accessible, offer wide variety and special offers, there is no reason why a customer will not come to you.
Restrict the bargain hunters
You may wonder why the companies are distributing so many free coupons! And whether they are happy in doing so! Well, you may also notice that there are only free coupon seekers who do not make great purchases. So put a restriction on such free loaders, maybe devise discount policies in such a way that the customer has no choice but to buy the products. For example, if you issue a coupon say for a worth of Rs. 1200, your products under this offer should be priced over 1200, so that the customer puts in a little more amount and buys your product. Also, keep the validity of the coupon for a limited period to ensure sale of the products for which the coupons has been issued.
Maintaining transparency in pricing
The price that a customer pays at times is for the total packaging and not for the product alone. For example, when we buy a mixer, a free toaster may come with it and also it will have warranty for a certain period and also include some free servicing in that period. Here, the real product price is not clear. Customers who are price specific may be discouraged from coming to such sellers.
Control over reselling price
It will be better to announce to its resellers the minimum price for reselling. This way, the company can assert the price of its products by ensuring that the reseller do not sell below the minimum price.
Recognizing profitable and non profitable customers
Lots of customers abuse sale by returning goods and eating into company profits. Recognize those customers and discourage them but do not forget to reward your coveted customers at the same time.
Buy back helps
A little out of the box thinking to increase the amount of daily dollop of butter on your bread will not hurt you so buyback all products that are being sold on discount and crumpling your new arrivals of same model. You may destroy the products or ship them overseas.
Put a mask on the brand
By selling your product through intermediaries who sell without revealing the name of the brand unless the deal is made, you get a chance to cover the brand name and protect the price from reaching the surfers before a sale.
Well, the above will hold true for most trading but remember that a customer with purchasing power will still buy what he wants and will refuse to be taken in by the hyped sale on the net. Anita says,” I would read a best seller today rather than wait for it to come on e-reading site which will happen later. I will pay whatever the price”.
Kanan says, “I would prefer to go to a shop for apparels and shoes to avoid getting a wrong size through net and crib later”.
This comes as a sigh of relief. Retailers, you could still see hope and exercise your desired price!