Yes, Consumers Do Want More

In anticipation of "Black Friday," last week there was a great deal of talk about retail sales. As a consequence of daily doses of dire economic commentary, consumers were curtailing spending. Bluntly put, they were worried about their incomes, their mortgages, and their financial stability.

One story on this subject that I watched reported retailers were "doing their best to lure customers into their stores with deep discounts." However, that promotional technique did not work in October. No matter how deep or ridiculous the discount, consumers were not prompted to purchase.

As a result, the story continued, some retail outlets were turning to other methods. A mall manager commented that they were focusing on "creating a festive environment and an enjoyable experience for shoppers." That mall was tapping into the spirit of the season and giving consumers a reason beyond price to shop there.

Another story about a couple of local businesses supported that approach. Owners from both of these businesses said that "personal attention worked very well." One noted that their store carried "one-of-a-kind pieces which made a more unique gift." The other stated that their customers kept coming back, and, because of that, the store's sales were even with last year. "If we can stay even with last year in this economy, we'll be fine," the owner said.

For years, the chain stores have based their sales on price and promoting the price of items. They have grown their revenues by opening new stores. They have masked the financial health of their businesses with this growth. They have not paid attention to developing their customers. They have not paid attention to what their customers want.

Customers want more than a cheaper price. Customers decide to buy a product, a service, or information because of what it will do for them, not because of its price. Once they have become interested in a product, service, or information, they may be lured into a store by a price. However, after making that purchase, they have no reason to return to the store unless the store offers another cheap price on something the customer decides to buy. This requires the store to get into a vicious cycle of offering the "cheapest" prices on the "hottest" items.


The underlying problem for these stores which base their sales on price is where they enter the picture in the customer's buying cycle. They are entering after the customer has decided to buy and before the customer has made the purchase, which is a very narrow window of time. This narrow window requires them to advertise special pricing heavily, especially during known buying times such as Christmas. If they stayed close to their customers as the two local businesses noted above did, they would be in the picture earlier in the decision, allowing them to sell the customer earlier in the cycle and make more profit doing so.

Yes, consumers do want more than the cheapest price. They want to be developed as customers and given personal attention. Are you doing this with your customers?