9 ms·

Phone-Wielding Shoppers Strike Fear Into Retailers

60 points by andre3k1 16y ago

noonespecial 16y ago
I'm hoping that this trend ends with the re-introduction of something I've long felt is missing from the American shopping experience. The ability to haggle. Circumstances surrounding items in stores change by the minute. Things like demand, how long an item has been at a store, the fact that an updated model was just released, etc. American retail stores seem bound to the retail price set in the computer even when that price has been made absurd by unfolding circumstances. It would be much better if the staff were empowered to deal than to ship unsellables off to some giant auction house to get pennies on the dollar. Of course, that would mean creating a chain of authority in stores ending with giving minimum wage employees responsibility. Then again, if you can give them a cut for upselling those ridiculous "monster" cables, they may relish the opportunity.
- fleitz 16y ago
  I haggle at almost every store on anything more than $100. Seriously, what store won't let you haggle on a major purchase? My favorite haggling technique is to ask about the credit options and extended warranty. If you're going to haggle, act like you're going to buy it on the store credit card with extended warranty.
  - noonespecial 16y ago
    I usually try as well. Sometimes it works, more times it doesn't. It almost always comes with an odd look or the great big "you just added a lot more work to my day" sigh. I usually go after the "last years model" or "clearance" type items, iphone in hand to demonstrate the current retail value. The most they'll ever do is knock a few percent off and offer me a free cable or something. Their best offers are almost always still ludicrously beyond the reasonable current price. Trying for more gets us a little session at the Altar of the Wyse Terminal, followed by a shrug and "It won't let me do that". Even when the manager is involved. I'm hoping that bargaining in retail stores will become both common, fruitful, and a socially expected norm.
    - ams6110 16y ago
      I don't think it's likely. It doesn't scale to the transaction volume of a department store. Imagine you're in the checkout queue at Walmart and the person ahead of you is trying to bargain with the cashier for 20 minutes to try to save a few dollars.
      - noonespecial 16y ago
        I've seen some pretty impressive scale at markets in other countries, bargaining and all. Perhaps its Walmart that's the misfit?
      - jasonlotito 16y ago
        I have a mother-in-law I'd like you to meet. Granted, it wasn't Walmart. Rather, the Dollar Store. >_<
- andre3k1 16y ago
  Or you could do what Neiman Marcus does – employees are 100% commission based. In this case, the employees commission would be derived from how much over a hidden base price they were able to sell the item for. That way the could lower the price for the customer, but it wouldn't be in their best interest to do so.
- deleted 16y ago
  [deleted]
fleitz 16y ago
Best Buy doesn't care about people price checking GPS units, they care about people price checking HDMI cables. Watch for cell blockers to be installed near the cable isle.
- Zak 16y ago
  Cell blockers are illegal in the US. Even when the power is very low, if there's enough circumstantial evidence to prove intent to interfere with a transmission, I think that's an $11,000 fine from the FCC.
  - trotsky 16y ago
    Perfectly legal to install EM shielding or a Faraday cage. I bet you'd only have to install a few of them before the mobile companies agreed to block certain urls whenever they triangulated a phone as inside one of your stores.
    - Zak 16y ago
      Customers would riot.
  - conover 16y ago
    I wonder how casinos get away with seemingly blocking cellphone signals. In my experience whenever you go near a slot machine or table game in a casino, cell signal drops to zero.
- minouye 16y ago
  Wouldn't that defeat the point of putting QR codes on all of their product labels?
stoney 16y ago
I sometimes feel a bit bad about price checking items in a local shop against the web. For example, I wanted to buy some climbing shoes recently. I have never bought a pair before, had no idea what I should be looking for and what size I should get. I went to a local climbing specialist, they talked me through the options, fitted me for a shoe, etc. At that point I could have left the store and bought the shoes on eBay for about 75% of what they would have cost in the store, but I didn't - I chose to pay full price because the store offered me a valuable service. If that store hadn't been there I couldn't have tried on the shoes. So I think there is a place for paying more for goods when you want/need extra assistance. In the case of huge stores like BestBuy that are basically like a warehouse with pretty much no customer service except at the checkout I would have no problem buying from the cheapest alternative provider (Amazon/ebay/whatever).
- Qz 16y ago
  I went to Best Buy looking for a DVI <-> HDMI cable once. They wanted 40 dollars. I got it on Amazon for 7.95. And they wonder why their stock recently took a big hit...
  - Encosia 16y ago
    I hate to get too far off topic, but when it comes to cables, you should know about Monoprice: http://www.monoprice.com/products/subdepartment.asp?c_id=102&cp_id=10231 http://www.monoprice.com/products/subdepartment.asp?c_id=102...
    - jackowayed 16y ago
      I second this. Monoprice is great. Their cables are dirt cheap yet at least as high quality as what you'll get anywhere else. They're also great for adapters. I bet 10% of the people reading this have paid Apple $30 for a Mini DisplayPort to {VGA|DVI|HDMI} adapter. I got all 3 for $30-something.
  - stoney 16y ago
    Yeah, there's a limit to how much of a premium I'm prepared to pay for the benefit of bricks and mortar! Though cables can vary a bit in price depending on quality, so that might have come into it a bit too.
Umalu 16y ago
At least shoppers with bar code scanners are still visiting stores. What should really be striking fear and terror into the hearts of retailers are shoppers who never set foot in stores anymore, people who, like me, order everything online.
- gmjosack 16y ago
  You're not consuming time of their staff asking questions and using resources. People who go to the store to get information with no intent to buy are worse than people who just ignore the store.
  - tomjen3 16y ago
    Not really - with Amazon you have to add shipping and a trip to the local post office (since they _never_ deliver when you are home), and nobody is going across town to save 20$ on a several houndred dollar widescreen tv. But when you don't go to the store _at all_ there is no way they make a sale.
    - drusenko 16y ago
      Have your packages delivered to work and get Amazon Prime. Problems solved :)
    - gjm11 16y ago
      The cost of the TV shouldn't make any difference to your willingness to go across town to save $20. Saving $20 on something that costs $400 gets you exactly as much benefit as saving $20 on something that costs $40. That's not to say that you should be going across town to save $20 on anything. It might well not be worth the cost in time and fuel. But doing that to get a $20 item free, or a $40 item at half price, shouldn't be any more appealing than doing it to get 2% off the price of a $1000 item. (It's a serious bug in our wetware that all the above feels so unintuitive to most of us.)
      - tomjen3 16y ago
randrews 16y ago
The "Expected growth in merchandise purchases made on cell phones" graph in this article may be the worst one I have ever seen. They extrapolated an exponential growth curve from one point. They only have data for 2009! Not even 2010, much less the 2014 they plotted out to!
WillyF 16y ago
I go to Borders all the time to find things I should buy on Amazon. I rarely buy anything. Why would I when I can get the same book half price and have it in 2 days (or now instantly on my Kindle)? Borders doesn't offer enough additional value to make me feel bad about this. I'd have to be stupid to pay their premium. Yet, when I buy fly fishing equipment, I almost always buy from a local store—and even the "big box" store, Orvis, offers a fantastic in-store customer experience. Why am I loyal? Because they don't try to sell me crap. They let me hang out and talk fishing. They help me find new spots and learn about new techniques. There's a huge value add, and I'm willing to pay a premium. Big box stores put a lot of mom and pops out of business in the 90s and 2000s. Now they're getting killed by online retailers. I'm not sure who's going to take out Amazon, but I wouldn't be surprised if there's some level of resurgence when it comes to local retailers who focus on service.
- mahmud 16y ago
  Borders tries to sell you crap? Not my experience. It's a nice place to hangout and I always buy something.
  - WillyF 16y ago
    I didn't intend to insinuate that Borders in particular try to sell me crap, just that plenty of stores do. The fishing section in any Wal-Mart or Target is a perfect example. I should note, though, that the eReader devices that Borders has on display in their stores are particularly junky. I spent a little time playing around with them, and they were completely unusable for me. I don't find my Kindle particularly intuitive to use (at least until I have a book loaded up), but the devices that I played with in Borders were terrible.
- gjm11 16y ago
  > I rarely buy anything [at Borders]. Why would I when I can get the same book half price [...]? Because you've made use of the facilities at Borders that make them need to charge you more -- the physical store with a stock of physical books and actual staff who can help you if you can't find something or want extra information. You've derived a tangible benefit from your use of those facilities: you've found some books that interest you, and established that some others aren't worth what they cost. Sure, no one is then forcing you to buy the books in Borders; neither the police nor Borders staff will give you any trouble for freeloading. And it's not actually against the law. If that's all you care about, fair enough. But it's not like there are no reasons for buying things in a bookshop when you've benefited from the things they offer and Amazon doesn't. Another reason: If you find Borders useful, then you'd probably prefer them to stay in business. You might want to help with that. Again, no one's forcing you to, and you may just not care much about the tragedy-of-the-commons effect that may ensue when you and others don't. But it's a reason. > Borders doesn't offer enough additional value to make me feel bad about this. You can give them some but not all of the additional value by buying some but not all of those books from Borders. For instance, the ones where the price premium compared to Amazon is smaller. (For the avoidance of doubt, I'm not saying "Bricks-and-mortar good, online bad". I buy a lot of books on line, more than I buy in physical bookshops. Amazon offers useful services that Borders doesn't -- customer reviews, the recommendation system, and so on. If you've benefited from those, that's a reason to buy from Amazon.)
happywolf 16y ago
Instead of checking the price, I check on the reviews for the product while I am in store, especially if that product is something I am not familiar with. Recently I went to shop for a compact camera with no particular brand in mind, I went to the shop, checked out what's on offer, and read the reviews on the spot via my iPhone. This process helped me to weed out a few cameras, and finally I got a camera (Canon Ixus 130) at a price that I am happy with. Since I already know the pros and cons of this camera, I must say I am quite happy with my purchase as it removes a lot of uncertainty from the purchase (No, AFAIK, most shops in Singapore don't provide refund or exchange for purchases...)
veb 16y ago
And when do they ban smart-phones from being used in public because they can take "hidden" pictures or some bullshit?
trotsky 16y ago
People need to square up in their heads that the retail experience necessitates higher prices. If you don't want to pay the higher prices, that's fine - but then what are you doing in the store in the first place? Pretty much everything is cheaper online. If you need to go to best buy or borders to find the product you want on amazon, the whole process is unsustainable. Also, just like supporting locally owned business, supporting locally operated business is in your best interests. They create local jobs and contribute to the local tax base. I know this isn't a popular opinion, but the sales tax disparity needs to go. The states get triple penalized by it - lack of tax revenue, lack of jobs and it creates a disincentive to online retailers to spread their operations. Maybe they all need to drop it entirely and raise income taxes to make it up (which isn't a bad idea, sales tax being at least somewhat regressive). If not, they need to find a way to collect it. I have no doubt that this trend will accelerate though, I am guilty of doing it myself. Just like we didn't really realize what we had lost with local farming and the corner hardware store until they were mostly gone, we probably won't realize how much we miss local retail until there a huge portion of goods simply can't be found in person.
- tomjen3 16y ago
  There is some value in getting the item today, even if it cost a bit more than getting it online. In addition, you avoid paying for shipping. The difference is what the local business can charge over the online option.
  - trotsky 16y ago
    Then in the day of amazon prime free two day air, I guess they really are doomed. You simply can't compete with the economies of scale and purchasing power of an amazon while at the same time paying a 5-7% penalty, a lease, insurance, utilities, shrinkage, etc. Let's say 1 in 10 things you purchase you need to buy today. That means 90% of purchases should be online the way you see it. But if local stores suddenly lost 90% of their business, the prices on the 10% would have to go way up. They'd have to stop stocking a lot of items, lower inventory on the rest. Their buying power would be destroyed. The enablers of retail would dry up - distributors close, regional truckers take jobs with ups, they tear down the storefronts and put in housing. Once you lose something it can be hard as hell to get it back. Want to buy US made textiles? Good luck. To buy local produce I am a member of a CSA - I have to pay for a year upfront, pick up my box between 4:30-6:30 friday, have no real control over what I get, if I need extra for a dinner party i'm out of luck, and I think there is a 2-3 year waiting list. The local meat and milk I buy is illegal, the regulatory environment has long moved past small producers. Want to shop at a locally owned hardware store? Hopefully there is one still open around you. If there isn't, how do you signal that you want one? Their owners have retired, nobody is learning how to run one, the banks wouldn't lend to a new one anyway. Online shopping is cheaper right now because it has to be. If the retail framework went away would it stay that way? It would make sense to raise your margins in an online only world. Transparency and dynamic pricing means you can always go back down if someone undercuts you. Manufacturer quality may dive as well. If you make a mis-stitched or badly sized piece of clothing it simply won't sell at retail. It will always sell online. How many people will return it? Certainly not 100% Exclusivity is another issue. Once you don't need to support retail, you can supply 100% of your customers from just one or two websites. Manufacturers love this. Don't like the discounting? Raise their wholesale cost. Tie products, lockout competition, force sites to take your whole invetory as it rolls off the line. Places like Apple are so vertically integrated it'd simply make sense for them to sell direct only. They'd keep the apple stores open - after all they won't be undercutting themselves. Buying a copy of OS X? No problem, just need to verify that you've registered an approved platform with us. Jailbreaker? If they know who you are you go on a lifetime ban list. Friend buys you the new phone? If we track down the udid you're using then he's banned for life too. Bet that'll make you rather unpopular. Retailers need to rethink old marketing strategies in the age of price transparency. Loss leaders and make up items give you too much incentive to shop around. If I knew everything at a store was reliably 15%-20% over the best online price I wouldn't feel the need to pull out the phone and check prices. It's the fact that there are little +50% or +300% landmines - and once I've found one of those and will order it online instead it seems silly to buy these other lower markup items in store when i could just add them to my online order and save a bit more. Move to shelf dynamic pricing to respond to online changes quickly. If a product does 97% volume online and 3% in your store, fuck it, dump 'em and choose another or private brand it. If 50% of the people who inspect a product in your store go on to buy it online demand promotional fees from the manufacturer and use them to offset higher costs. Integrate better with the community - support local schools and charities instead of national ones, stock local/regional brands, don't fight to open somewhere you're not wanted. Make it so people want to shop at your store to show their gratitude. Tell the local stories all over your store so everyone has a reason to think twice before opting to shave a couple bucks off. Dump the shady sales tactics, flatten commissions, fire anyone caught lying, speak honestly about product shortcomings, never use ignorance to oversell. If people know they can trust your sales staff they'll go to them a lot more, and people getting real help from a salesman don't pull out their phone and order it online at the end.
erikstarck 16y ago
I wonder if there's an opportunity here. What if you had a store where you couldn't actually buy stuff (well you could order stuff from affiliate partners) and it cost money to enter? Sort of like a fair but always running and on a central position. A gadget paradise of sorts. I think it would work.
syllogism 16y ago
I want to know what PR firm is behind this so I can hire them. What's an article like this worth to that shopping app? 100k? More? Good lord...
jboydyhacker 16y ago
While it's true that this trend favors those who are price leaders, there is another opportunity. As people are connected with reviews, content, and comments from other users new conversations can take place between the retailer and their customers. That's an opportunity for retailers to do targeted marketing with deals, specialized advertising and in store games, so that they are not just competing on price but on the long term relationship and buying patterns of the customer.

60 points by andre3k1 16y ago

I'm hoping that this trend ends with the re-introduction of something I've long felt is missing from the American shopping experience. The ability to haggle. Circumstances surrounding items in stores change by the minute. Things like demand, how long an item has been at a store, the fact that an updated model was just released, etc. American retail stores seem bound to the retail price set in the computer even when that price has been made absurd by unfolding circumstances. It would be much better if the staff were empowered to deal than to ship unsellables off to some giant auction house to get pennies on the dollar. Of course, that would mean creating a chain of authority in stores ending with giving minimum wage employees responsibility. Then again, if you can give them a cut for upselling those ridiculous "monster" cables, they may relish the opportunity.

fleitz 16y ago
I haggle at almost every store on anything more than $100. Seriously, what store won't let you haggle on a major purchase? My favorite haggling technique is to ask about the credit options and extended warranty. If you're going to haggle, act like you're going to buy it on the store credit card with extended warranty.
- noonespecial 16y ago
  I usually try as well. Sometimes it works, more times it doesn't. It almost always comes with an odd look or the great big "you just added a lot more work to my day" sigh. I usually go after the "last years model" or "clearance" type items, iphone in hand to demonstrate the current retail value. The most they'll ever do is knock a few percent off and offer me a free cable or something. Their best offers are almost always still ludicrously beyond the reasonable current price. Trying for more gets us a little session at the Altar of the Wyse Terminal, followed by a shrug and "It won't let me do that". Even when the manager is involved. I'm hoping that bargaining in retail stores will become both common, fruitful, and a socially expected norm.
  - ams6110 16y ago
    I don't think it's likely. It doesn't scale to the transaction volume of a department store. Imagine you're in the checkout queue at Walmart and the person ahead of you is trying to bargain with the cashier for 20 minutes to try to save a few dollars.
    - noonespecial 16y ago
      I've seen some pretty impressive scale at markets in other countries, bargaining and all. Perhaps its Walmart that's the misfit?
    - jasonlotito 16y ago
      I have a mother-in-law I'd like you to meet. Granted, it wasn't Walmart. Rather, the Dollar Store. >_<
andre3k1 16y ago
Or you could do what Neiman Marcus does – employees are 100% commission based. In this case, the employees commission would be derived from how much over a hidden base price they were able to sell the item for. That way the could lower the price for the customer, but it wouldn't be in their best interest to do so.
deleted 16y ago
[deleted]

fleitz 16y ago

Best Buy doesn't care about people price checking GPS units, they care about people price checking HDMI cables. Watch for cell blockers to be installed near the cable isle.

Zak 16y ago
Cell blockers are illegal in the US. Even when the power is very low, if there's enough circumstantial evidence to prove intent to interfere with a transmission, I think that's an $11,000 fine from the FCC.
- trotsky 16y ago
  Perfectly legal to install EM shielding or a Faraday cage. I bet you'd only have to install a few of them before the mobile companies agreed to block certain urls whenever they triangulated a phone as inside one of your stores.
  - Zak 16y ago
    Customers would riot.
- conover 16y ago
  I wonder how casinos get away with seemingly blocking cellphone signals. In my experience whenever you go near a slot machine or table game in a casino, cell signal drops to zero.
minouye 16y ago
Wouldn't that defeat the point of putting QR codes on all of their product labels?

stoney 16y ago

I sometimes feel a bit bad about price checking items in a local shop against the web. For example, I wanted to buy some climbing shoes recently. I have never bought a pair before, had no idea what I should be looking for and what size I should get. I went to a local climbing specialist, they talked me through the options, fitted me for a shoe, etc. At that point I could have left the store and bought the shoes on eBay for about 75% of what they would have cost in the store, but I didn't - I chose to pay full price because the store offered me a valuable service. If that store hadn't been there I couldn't have tried on the shoes. So I think there is a place for paying more for goods when you want/need extra assistance. In the case of huge stores like BestBuy that are basically like a warehouse with pretty much no customer service except at the checkout I would have no problem buying from the cheapest alternative provider (Amazon/ebay/whatever).

Qz 16y ago
I went to Best Buy looking for a DVI <-> HDMI cable once. They wanted 40 dollars. I got it on Amazon for 7.95. And they wonder why their stock recently took a big hit...
- Encosia 16y ago
  I hate to get too far off topic, but when it comes to cables, you should know about Monoprice: http://www.monoprice.com/products/subdepartment.asp?c_id=102&cp_id=10231 http://www.monoprice.com/products/subdepartment.asp?c_id=102...
  - jackowayed 16y ago
    I second this. Monoprice is great. Their cables are dirt cheap yet at least as high quality as what you'll get anywhere else. They're also great for adapters. I bet 10% of the people reading this have paid Apple $30 for a Mini DisplayPort to {VGA|DVI|HDMI} adapter. I got all 3 for $30-something.
- stoney 16y ago
  Yeah, there's a limit to how much of a premium I'm prepared to pay for the benefit of bricks and mortar! Though cables can vary a bit in price depending on quality, so that might have come into it a bit too.

Umalu 16y ago

At least shoppers with bar code scanners are still visiting stores. What should really be striking fear and terror into the hearts of retailers are shoppers who never set foot in stores anymore, people who, like me, order everything online.

gmjosack 16y ago
You're not consuming time of their staff asking questions and using resources. People who go to the store to get information with no intent to buy are worse than people who just ignore the store.
- tomjen3 16y ago
  Not really - with Amazon you have to add shipping and a trip to the local post office (since they _never_ deliver when you are home), and nobody is going across town to save 20$ on a several houndred dollar widescreen tv. But when you don't go to the store _at all_ there is no way they make a sale.
  - drusenko 16y ago
    Have your packages delivered to work and get Amazon Prime. Problems solved :)
  - gjm11 16y ago
    The cost of the TV shouldn't make any difference to your willingness to go across town to save $20. Saving $20 on something that costs $400 gets you exactly as much benefit as saving $20 on something that costs $40. That's not to say that you should be going across town to save $20 on anything. It might well not be worth the cost in time and fuel. But doing that to get a $20 item free, or a $40 item at half price, shouldn't be any more appealing than doing it to get 2% off the price of a $1000 item. (It's a serious bug in our wetware that all the above feels so unintuitive to most of us.)
    - tomjen3 16y ago

randrews 16y ago

The "Expected growth in merchandise purchases made on cell phones" graph in this article may be the worst one I have ever seen. They extrapolated an exponential growth curve from one point. They only have data for 2009! Not even 2010, much less the 2014 they plotted out to!

WillyF 16y ago

I go to Borders all the time to find things I should buy on Amazon. I rarely buy anything. Why would I when I can get the same book half price and have it in 2 days (or now instantly on my Kindle)? Borders doesn't offer enough additional value to make me feel bad about this. I'd have to be stupid to pay their premium. Yet, when I buy fly fishing equipment, I almost always buy from a local store—and even the "big box" store, Orvis, offers a fantastic in-store customer experience. Why am I loyal? Because they don't try to sell me crap. They let me hang out and talk fishing. They help me find new spots and learn about new techniques. There's a huge value add, and I'm willing to pay a premium. Big box stores put a lot of mom and pops out of business in the 90s and 2000s. Now they're getting killed by online retailers. I'm not sure who's going to take out Amazon, but I wouldn't be surprised if there's some level of resurgence when it comes to local retailers who focus on service.

mahmud 16y ago
Borders tries to sell you crap? Not my experience. It's a nice place to hangout and I always buy something.
- WillyF 16y ago
  I didn't intend to insinuate that Borders in particular try to sell me crap, just that plenty of stores do. The fishing section in any Wal-Mart or Target is a perfect example. I should note, though, that the eReader devices that Borders has on display in their stores are particularly junky. I spent a little time playing around with them, and they were completely unusable for me. I don't find my Kindle particularly intuitive to use (at least until I have a book loaded up), but the devices that I played with in Borders were terrible.
gjm11 16y ago
> I rarely buy anything [at Borders]. Why would I when I can get the same book half price [...]? Because you've made use of the facilities at Borders that make them need to charge you more -- the physical store with a stock of physical books and actual staff who can help you if you can't find something or want extra information. You've derived a tangible benefit from your use of those facilities: you've found some books that interest you, and established that some others aren't worth what they cost. Sure, no one is then forcing you to buy the books in Borders; neither the police nor Borders staff will give you any trouble for freeloading. And it's not actually against the law. If that's all you care about, fair enough. But it's not like there are no reasons for buying things in a bookshop when you've benefited from the things they offer and Amazon doesn't. Another reason: If you find Borders useful, then you'd probably prefer them to stay in business. You might want to help with that. Again, no one's forcing you to, and you may just not care much about the tragedy-of-the-commons effect that may ensue when you and others don't. But it's a reason. > Borders doesn't offer enough additional value to make me feel bad about this. You can give them some but not all of the additional value by buying some but not all of those books from Borders. For instance, the ones where the price premium compared to Amazon is smaller. (For the avoidance of doubt, I'm not saying "Bricks-and-mortar good, online bad". I buy a lot of books on line, more than I buy in physical bookshops. Amazon offers useful services that Borders doesn't -- customer reviews, the recommendation system, and so on. If you've benefited from those, that's a reason to buy from Amazon.)

happywolf 16y ago

Instead of checking the price, I check on the reviews for the product while I am in store, especially if that product is something I am not familiar with. Recently I went to shop for a compact camera with no particular brand in mind, I went to the shop, checked out what's on offer, and read the reviews on the spot via my iPhone. This process helped me to weed out a few cameras, and finally I got a camera (Canon Ixus 130) at a price that I am happy with. Since I already know the pros and cons of this camera, I must say I am quite happy with my purchase as it removes a lot of uncertainty from the purchase (No, AFAIK, most shops in Singapore don't provide refund or exchange for purchases...)

veb 16y ago

And when do they ban smart-phones from being used in public because they can take "hidden" pictures or some bullshit?

trotsky 16y ago

People need to square up in their heads that the retail experience necessitates higher prices. If you don't want to pay the higher prices, that's fine - but then what are you doing in the store in the first place? Pretty much everything is cheaper online. If you need to go to best buy or borders to find the product you want on amazon, the whole process is unsustainable. Also, just like supporting locally owned business, supporting locally operated business is in your best interests. They create local jobs and contribute to the local tax base. I know this isn't a popular opinion, but the sales tax disparity needs to go. The states get triple penalized by it - lack of tax revenue, lack of jobs and it creates a disincentive to online retailers to spread their operations. Maybe they all need to drop it entirely and raise income taxes to make it up (which isn't a bad idea, sales tax being at least somewhat regressive). If not, they need to find a way to collect it. I have no doubt that this trend will accelerate though, I am guilty of doing it myself. Just like we didn't really realize what we had lost with local farming and the corner hardware store until they were mostly gone, we probably won't realize how much we miss local retail until there a huge portion of goods simply can't be found in person.

tomjen3 16y ago
There is some value in getting the item today, even if it cost a bit more than getting it online. In addition, you avoid paying for shipping. The difference is what the local business can charge over the online option.
- trotsky 16y ago
  Then in the day of amazon prime free two day air, I guess they really are doomed. You simply can't compete with the economies of scale and purchasing power of an amazon while at the same time paying a 5-7% penalty, a lease, insurance, utilities, shrinkage, etc. Let's say 1 in 10 things you purchase you need to buy today. That means 90% of purchases should be online the way you see it. But if local stores suddenly lost 90% of their business, the prices on the 10% would have to go way up. They'd have to stop stocking a lot of items, lower inventory on the rest. Their buying power would be destroyed. The enablers of retail would dry up - distributors close, regional truckers take jobs with ups, they tear down the storefronts and put in housing. Once you lose something it can be hard as hell to get it back. Want to buy US made textiles? Good luck. To buy local produce I am a member of a CSA - I have to pay for a year upfront, pick up my box between 4:30-6:30 friday, have no real control over what I get, if I need extra for a dinner party i'm out of luck, and I think there is a 2-3 year waiting list. The local meat and milk I buy is illegal, the regulatory environment has long moved past small producers. Want to shop at a locally owned hardware store? Hopefully there is one still open around you. If there isn't, how do you signal that you want one? Their owners have retired, nobody is learning how to run one, the banks wouldn't lend to a new one anyway. Online shopping is cheaper right now because it has to be. If the retail framework went away would it stay that way? It would make sense to raise your margins in an online only world. Transparency and dynamic pricing means you can always go back down if someone undercuts you. Manufacturer quality may dive as well. If you make a mis-stitched or badly sized piece of clothing it simply won't sell at retail. It will always sell online. How many people will return it? Certainly not 100% Exclusivity is another issue. Once you don't need to support retail, you can supply 100% of your customers from just one or two websites. Manufacturers love this. Don't like the discounting? Raise their wholesale cost. Tie products, lockout competition, force sites to take your whole invetory as it rolls off the line. Places like Apple are so vertically integrated it'd simply make sense for them to sell direct only. They'd keep the apple stores open - after all they won't be undercutting themselves. Buying a copy of OS X? No problem, just need to verify that you've registered an approved platform with us. Jailbreaker? If they know who you are you go on a lifetime ban list. Friend buys you the new phone? If we track down the udid you're using then he's banned for life too. Bet that'll make you rather unpopular. Retailers need to rethink old marketing strategies in the age of price transparency. Loss leaders and make up items give you too much incentive to shop around. If I knew everything at a store was reliably 15%-20% over the best online price I wouldn't feel the need to pull out the phone and check prices. It's the fact that there are little +50% or +300% landmines - and once I've found one of those and will order it online instead it seems silly to buy these other lower markup items in store when i could just add them to my online order and save a bit more. Move to shelf dynamic pricing to respond to online changes quickly. If a product does 97% volume online and 3% in your store, fuck it, dump 'em and choose another or private brand it. If 50% of the people who inspect a product in your store go on to buy it online demand promotional fees from the manufacturer and use them to offset higher costs. Integrate better with the community - support local schools and charities instead of national ones, stock local/regional brands, don't fight to open somewhere you're not wanted. Make it so people want to shop at your store to show their gratitude. Tell the local stories all over your store so everyone has a reason to think twice before opting to shave a couple bucks off. Dump the shady sales tactics, flatten commissions, fire anyone caught lying, speak honestly about product shortcomings, never use ignorance to oversell. If people know they can trust your sales staff they'll go to them a lot more, and people getting real help from a salesman don't pull out their phone and order it online at the end.

erikstarck 16y ago

I wonder if there's an opportunity here. What if you had a store where you couldn't actually buy stuff (well you could order stuff from affiliate partners) and it cost money to enter? Sort of like a fair but always running and on a central position. A gadget paradise of sorts. I think it would work.

syllogism 16y ago

I want to know what PR firm is behind this so I can hire them. What's an article like this worth to that shopping app? 100k? More? Good lord...

jboydyhacker 16y ago

While it's true that this trend favors those who are price leaders, there is another opportunity. As people are connected with reviews, content, and comments from other users new conversations can take place between the retailer and their customers. That's an opportunity for retailers to do targeted marketing with deals, specialized advertising and in store games, so that they are not just competing on price but on the long term relationship and buying patterns of the customer.