When was the last time you went to Macy’s or Bed, Bath & Beyond or any furniture store and paid full-price? Did you actually pay for shipping on any e-commerce purchases during the holiday?
At most retailers, regular price is the sucker price. You only pay it out of desperation or ignorance.
Walk through any mall and you are inundated with sales signs, with coupons and with triple rewards points. Buy one sports coat at regular price and get a second one at half-off? Yes, please.
One retailer–I’m looking at you Gap–even put their whole store on sales for several hours during the run up to Christmas.
It makes perfect sense that product gets marked down as the season draws to a close. It makes sense that your best customers get rewarded for concentrating their share of wallet with you. And faced with an intensely competitive market, one must certainly be mindful of maintaining market share.
But at what price comes the glory of same-store sales growth?
For years we have been teaching consumers that there is no integrity in our pricing. We have become a “discount nation”, bribing the promiscuous shopper to choose us over the competition while needlessly giving away margin to potentially loyal and profitable customers.
I don’t believe for a second that we are going to see an end to rampant discounting and blanket promotions any time soon. After all, it was just a few weeks ago that Target announced a new credit card that offers a straight 5% off all purchases.
I do believe that companies that deliver truly compelling value propositions and experiences based on a deep understanding of customers needs, wants and long-term profitability will win over the long-term. I do believe that the best brands–think Apple, Nordstrom and Coach–know how to drive their business at regular price.
Those brands do the work of customer-centricity.
Those other brands? We know what you are. All we are doing is negotiating.