For those of you in retail, I challenge you to survey your shoppers with a simple question….
“If you could change one thing about our stores, operations, and services, what would it be?”
From my experience over the years in retail, the overwhelming answer to this query will be ‘LOWER YOUR PRICES’. In fact, this response was so dominant our consumer surveys were designed to deflect this common response. To do so we added the caveat, “Other than lowering prices, what would you like to see changed….” Yes, we worked overtime to take “price” off the table and out of the discussion with our shoppers. We assumed that lowering prices was something that shoppers will always ask for, even unreasonably so. Further, we knew that lowering our prices was really out of the question, in fact we spent endless hours looking for ways to “smartly” raise prices to achieve margin goals.
So with “price” out of the discussion, we could then move on to ask our shoppers about aspects of our operation that we actually were willing and able to change. The lurking danger of dismissing consumer sentiments should be self evident. Competitors often find ways to accommodate your shopper’s wishes. When they do, sales, market share, and store traffic reflect your indifference to shopper imperatives. In fact, the emergence of Aldi, Walmart, and other “price” formats is a function of traditional retailers unsuccessfully attempting to take “price” out of the consumer discussion, into the headwinds of declining incomes and recession.
The stark reality is that those that have successfully relegated “low prices” to something less than a shopper headline, have invested heavily into services, product quality, and store facilities. In the grocery channel, Whole Foods, Fresh Market, Wegmans, and even Publix are among the list of retailers who understand that if you are to be known for something other than “price” and known to the extent that “price” is no longer a consumer priority, you must make a commitment to create a shopping experience that effectively changes the subject.
No silver bullets here, but my advice to retailers who struggle with meeting their shopper’s “price” expectations would be to chose one or two areas of your operation and build service and product quality programs around those offerings. As one example, if you want to be known for the best produce in the market, actually buy and maintain the best produce and train your associates to be knowledgable experts in both product and preparation of the product. Be consistent and talk about it incessantly. Once credibly is established as the place to go for produce, you might be surprised how much you can charge for bananas!
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