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There are a few examples of purchasing: 1. Heading to a grocery store with a list of items that you frequently buy that are priced at similar prices at every s

There are a few examples of purchasing: 1. Heading to a grocery store with a list of items that you frequently buy that are priced at similar prices at every store. 2. Going to a store to purchase a specific item 3. Going to a store to find an item For case #1 it's most likely that you're shopping at a place that is already competing for the lowest price point (places like Walmart and Target) so this application would be useless to you; however these stores already engage in the sort of activity the OP discusses. For case #2 if it's an item you've purchased previously you probably have a "favourite" store, one that you used previously and had a good experience with so naturally you go to this store. If this is an independent store they might have the item for $5 more than another store of a similar type, but because you've used this store before and because it has always been cheaper on previous occasions you bet that extra $5 against the time investment of finding if it is cheaper elsewhere (which isn't guaranteed) and go with the "safe" option. If in case #2 you didn't have to consider your previous purchases, if you could just type in the product into your phone and be told (without doubt) that the product is $10 cheaper at a store across the street from your normal store most people would take that; it's $10 that would be saved by walking across the street, it would be stupid not to, right? So now you have a situation where in case #2 any store that stocks an item (HP Printer, for example) is required to stock it at the lowest price because if they don't and a competitor is within 2 blocks (the "distance of $10") people will just go there instead. So now where is the value to the retailer? They enable themselves to be pitted against their competitors, thus requiring they lower their margins and inevitably lose out to bigger stores that can work with lower margins. In example #3 the same situation occurs, you enter a store and locate the item that you want, enter it into your phone and get told exactly where it can be acquired and at what price; if the store that has it cheapest is 2 blocks away and the price difference is $15 why not go over to the other store and save the $15? That store just lost a sale because of the system. Almost everyone that I know (I'm not from a rich background) would absolutely walk over the street to save $15, that's a non-neglible amount of money to quite a large portion of consumers. Sure if every other store has the item cheaper but it's only $0.25 difference people probably aren't going to go to another store, but then it becomes a race to the bottom. Wonderful for the consumers, awful for the retailer. What incentive is there for a retailer to force themselves to reduce their own margins? Currently purchasing an item in a retail store is a gamble on whether or not you'll pay the lowest price (unless you spend time researching every stores pricing), stores make money because of this. Currently it's a matter of taking a consumer, showing them a product and convincing them to purchase, if this system existed it would have an extra step: convince them to purchase at that particular store.

lotharbot 14y ago
Most items that cost enough that one store has a $10 or more savings over another store, I'm already comparison-shopping or buying from amazon. Retailers who aren't already cutting their margins in your examples 2-3 are losing my business to the internet. Where's the value to the retailer here? If they're back to being competitive with amazon, I'm going to have the opportunity to realize it, and I'll go back to buying from them. Also note that your store in case #3 doesn't lose the sale from their use of the app; I can see their price because I'm standing in the store, so they lose the sale whether or not they're using the app. Using the app doesn't gain them anything, so they might not use it -- but it does gain their competitor a sale, so the competitor definitely should use it. And of course a lot of what I buy costs little enough that comparison shopping is pointless. It's $3 at Wal-Mart and $4 in the store right next to my house? The closer store might gain a sale by telling me they exist and they have the thing I want (whether or not Wal-Mart is using this app, the dollar savings isn't making the difference). So the retailer again has the chance to gain value here. The net result here is that there is incentive for retailers, at least in some markets, to use such a system. They've already lost all the sales you worry this will make them lose, but this provides some opportunity for them to make back some sales in other circumstances. So it's a net win. Of course, it may not be enough of a net win to make it worth the effort for either the store or me as a consumer to use. Execution matters an awful lot. But it's not unreasonable that, done right, it could provide a lot of value to customers and retailers alike.
- citricsquid 14y ago
  > Most items that cost enough that one store has a $10 or more savings over another store, I'm already comparison-shopping or buying from amazon. Retailers who aren't already cutting their margins in your examples 2-3 are losing my business to the internet. Where's the value to the retailer here? If they're back to being competitive with amazon, I'm going to have the opportunity to realize it, and I'll go back to buying from them. Again, maybe this is a difference between America and the UK, I've never seen a retail store compete with an online store in price, the value in retail is instant purchase and no shipping cost. If you're already comparison shopping you're not the average customer. > Also note that your store in case #3 doesn't lose the sale from their use of the app; I can see their price because I'm standing in the store, so they lose the sale whether or not they're using the app. Using the app doesn't gain them anything, so they might not use it -- but it does gain their competitor a sale, so the competitor definitely should use it. I think I explained it poorly. My example #3 is if you walk into a store and see an item is $15, if you then think "it's probably at cheapest going to be $10 anywhere else, it's not worth walking to the 4 other shops that probably stock this item to find out, as 1 hour of my time is worth more to me than a $5 saving" that store retains the sale; if you pull out your phone and it says "it's $10 across the street" you're going to go that new shop. Therefore a sale is lost: stores that offer the lowest price win (to a point, $0.25 difference won't matter to most consumers) > And of course a lot of what I buy costs little enough that comparison shopping is pointless. It's $3 at Wal-Mart and $4 in the store right next to my house? The closer store might gain a sale by telling me they exist and they have the thing I want (whether or not Wal-Mart is using this app, the dollar savings isn't making the difference). So the retailer again has the chance to gain value here. So that there is marketing; a store exists and there are potential customers that don't know it exists. Surely the solution to that problem is proper advertising? In your example what if there is 2 grocery stores right next to your house; if both use the app then you go to the cheapest. The only way the app would be valuable in that situation is if the shop was far enough out of the way from cheaper shops that the time investment wasn't worth it to go to the other shops. > The net result here is that there is incentive for retailers, at least in some markets, to use such a system. They've already lost all the sales you worry this will make them lose, but this provides some opportunity for them to make back some sales in other circumstances. So it's a net win. I'm not sure what you mean. If you go in to a shop to buy a $15 item and you know that there are 4 other shops that stock it and MAYBE one of them will MAYBE stock it for $5 cheaper do you go to each of the 4 other shops to find it MAYBE cheaper? No, nobody does that, it's insane. Now if you could pull out your phone and be told "Shop x has it for $10" you KNOW you're getting a $5 saving and the other shop is across the street. You'd be stupid not to go and get it from the other place. This means that the only shops that win are shops that price it the lowest, or shops that are in an isolate environment (say a small town) with no competition; but then the people would never be using the app because they would know where everything is. > Of course, it may not be enough of a net win to make it worth the effort for either the store or me as a consumer to use. Execution matters an awful lot. But it's not unreasonable that, done right, it could provide a lot of value to customers and retailers alike. Customers, absolutely, this would be incredibly valuable to customers, but I have yet to see a situation posted that makes it valuable enough to retailers that they could risk the downsides. If you're the cheapest store, great, extra custom, but if you can't afford the margins that others can? Then your business won't last, whereas currently a store can exist with higher priced items because of people have a "favourite" shop because of expected quality of pricing and experience.

lotharbot 14y ago

Most items that cost enough that one store has a $10 or more savings over another store, I'm already comparison-shopping or buying from amazon. Retailers who aren't already cutting their margins in your examples 2-3 are losing my business to the internet. Where's the value to the retailer here? If they're back to being competitive with amazon, I'm going to have the opportunity to realize it, and I'll go back to buying from them. Also note that your store in case #3 doesn't lose the sale from their use of the app; I can see their price because I'm standing in the store, so they lose the sale whether or not they're using the app. Using the app doesn't gain them anything, so they might not use it -- but it does gain their competitor a sale, so the competitor definitely should use it. And of course a lot of what I buy costs little enough that comparison shopping is pointless. It's $3 at Wal-Mart and $4 in the store right next to my house? The closer store might gain a sale by telling me they exist and they have the thing I want (whether or not Wal-Mart is using this app, the dollar savings isn't making the difference). So the retailer again has the chance to gain value here. The net result here is that there is incentive for retailers, at least in some markets, to use such a system. They've already lost all the sales you worry this will make them lose, but this provides some opportunity for them to make back some sales in other circumstances. So it's a net win. Of course, it may not be enough of a net win to make it worth the effort for either the store or me as a consumer to use. Execution matters an awful lot. But it's not unreasonable that, done right, it could provide a lot of value to customers and retailers alike.

citricsquid 14y ago
> Most items that cost enough that one store has a $10 or more savings over another store, I'm already comparison-shopping or buying from amazon. Retailers who aren't already cutting their margins in your examples 2-3 are losing my business to the internet. Where's the value to the retailer here? If they're back to being competitive with amazon, I'm going to have the opportunity to realize it, and I'll go back to buying from them. Again, maybe this is a difference between America and the UK, I've never seen a retail store compete with an online store in price, the value in retail is instant purchase and no shipping cost. If you're already comparison shopping you're not the average customer. > Also note that your store in case #3 doesn't lose the sale from their use of the app; I can see their price because I'm standing in the store, so they lose the sale whether or not they're using the app. Using the app doesn't gain them anything, so they might not use it -- but it does gain their competitor a sale, so the competitor definitely should use it. I think I explained it poorly. My example #3 is if you walk into a store and see an item is $15, if you then think "it's probably at cheapest going to be $10 anywhere else, it's not worth walking to the 4 other shops that probably stock this item to find out, as 1 hour of my time is worth more to me than a $5 saving" that store retains the sale; if you pull out your phone and it says "it's $10 across the street" you're going to go that new shop. Therefore a sale is lost: stores that offer the lowest price win (to a point, $0.25 difference won't matter to most consumers) > And of course a lot of what I buy costs little enough that comparison shopping is pointless. It's $3 at Wal-Mart and $4 in the store right next to my house? The closer store might gain a sale by telling me they exist and they have the thing I want (whether or not Wal-Mart is using this app, the dollar savings isn't making the difference). So the retailer again has the chance to gain value here. So that there is marketing; a store exists and there are potential customers that don't know it exists. Surely the solution to that problem is proper advertising? In your example what if there is 2 grocery stores right next to your house; if both use the app then you go to the cheapest. The only way the app would be valuable in that situation is if the shop was far enough out of the way from cheaper shops that the time investment wasn't worth it to go to the other shops. > The net result here is that there is incentive for retailers, at least in some markets, to use such a system. They've already lost all the sales you worry this will make them lose, but this provides some opportunity for them to make back some sales in other circumstances. So it's a net win. I'm not sure what you mean. If you go in to a shop to buy a $15 item and you know that there are 4 other shops that stock it and MAYBE one of them will MAYBE stock it for $5 cheaper do you go to each of the 4 other shops to find it MAYBE cheaper? No, nobody does that, it's insane. Now if you could pull out your phone and be told "Shop x has it for $10" you KNOW you're getting a $5 saving and the other shop is across the street. You'd be stupid not to go and get it from the other place. This means that the only shops that win are shops that price it the lowest, or shops that are in an isolate environment (say a small town) with no competition; but then the people would never be using the app because they would know where everything is. > Of course, it may not be enough of a net win to make it worth the effort for either the store or me as a consumer to use. Execution matters an awful lot. But it's not unreasonable that, done right, it could provide a lot of value to customers and retailers alike. Customers, absolutely, this would be incredibly valuable to customers, but I have yet to see a situation posted that makes it valuable enough to retailers that they could risk the downsides. If you're the cheapest store, great, extra custom, but if you can't afford the margins that others can? Then your business won't last, whereas currently a store can exist with higher priced items because of people have a "favourite" shop because of expected quality of pricing and experience.