Series  |  Briefs  |  Quick tips  |  Basics  |  Other
Retail  |  Marketing  |  Products & Pricing  |  Other

Target Retail Price Comparison Results Presentation

Posted On - 20/03/2013 15:55:13

We surveyed over 100 customers across the top 60 lines you buy from us and proved what we suspected but you were naturally hesitant to believe. That you have material price advantage over the Big Guys. We have the data – not opinion, not logic, not rationale – to show you are better priced overall and you are on the majority of products. Categorically, you are better value than they are. Period. This workshop sets out the background to and main findings of the Comparison.

Part 1: Session Introduction


Context for This Session
Recap on the days previous sessions: "Shattering the Price Myth", "Wipe the Floor with the Big Guys" and "Get Offensive." The core message throughout has been to spell out the considerable material competitive advantages independents have over the Big Guys. And that your marketing needs to be far more assertive - even aggressive - to dispel the prevailing beliefs built up through the heavy marketing and loss-leaders the Big Guys use to lure customers away from you. Special focus was previously given to demonstrate how the huge costs of the Big Guys cancels out any purchasing advantage they have over independents. And that given our experience of the typical mark ups independents apply they are price competitive. This session serves to set out the results of the first Retail Price Comparison to show with data that independent IT retailers are better priced than the Big Guys.

Part 2: How and Why We Did It


How and Why We Completed the Comparison
Since starting to offer one-to-one mentoring support to customers it has quickly become clear to us just how key a business issue price setting is. Approaches vary widely and the internet is often used as a guide. Separately, we noticed a growing number of pricing conversations - customers exchanging pricing information between themselves - on our exclusive customer Forum. Further we were experiencing customers personally asking our advice on for their selling prices.

Given our positioning as supplier to several thousand independents, it became patently obvious we not just could, but should help. If we could organise and administer a structured Price Comparison, enabling large numbers of businesses to gather direct competitor intelligence from the comfort of their offices, we could help them with practical, impartial, meaningful and grounded advice - advice invaluable to objective price setting. For this reason we embarked on creating and delivering the first Price Comparison of its type.

Part 3: Summary of Pricing Results


Summary of Price Results
The detail of the Comparison is reserved for those who took part – what's given here is an overall summary. They receive individual reports with their detailed price positioning against the Multiples and the other participants. That said, I can share this with you though. You beat the Big Guys. Every one – even Tesco, by far the most aggressively priced. First, the "basket comparison" which compares overall pricing on all products surveyed was an average of 15% better priced. Second, the "win ratio" – the ratio of lines where you're better priced compared to lines where you're more expensive. Here, you "won" – that means being better priced – on 63% of products. So, you're not just better priced. You're convincingly so.

Part 4: Price/Sales Satisfaction Detail


Price/Sales Satisfaction Detail
Our research points to relatively weak price elasticity across the range. Just over half of product lines have greater sales satisfaction at the lowest prices, meaning the converse for the remainder. Additionally, differences in satisfaction are relatively small. Pragmatically, the research suggests pricing up to 26% above the average only loses 3% on sales satisfaction. Conversely, pricing up to 23% under the average gain just 3% in satisfaction. The message is clear: the effect of pricing on changes in sales is no-where near as sensitive as many of you believe it to be. What's more selling low against your competitors is highly unlikely to buy enough volume to pay for what you're giving away through the discounts themselves.

Part 5: Conclusions and Recommended Actions


Conclusions and Recommended Actions
You have genuine price advantages over the big guys. Yet the public believes you more expensive. You have to understand where your pricing sits with your competitors and learn to explain pricing differences. Remember price is a lethal weapon and being too cheap will destroy trust in you. Be prepared to discuss pricing openly and without anxiety or embarrassment. Above all, look for opportunities to increase prices to make yours reasonable given what you're offering. 

 

 

Please tell us why you dislike this blog article?
Display Name:
Email Address:
Post comment?
I accept the terms and conditions set out here
Comments:
Post Cancel
Archives
February 2018 (1)
January 2018 (2)
December 2017 (2)
November 2017 (4)
Earlier (301)
Contact Us
Like what you've read? Then why not sign up to the Shop Talk newsletter?

Have ideas or want to discuss them further? Don't understand what's been written and need some explanation? If you want to talk, for whatever reason, we're happy to as well.

The best ways to find us are by email or by mobile:

01977 282 300 & choose option 5

Alternatively please call 01977 282 359 to speak to a member of our ShopTalk team


You have already signed up to the Shop Talk mailing list

Shop Talk: The only blog for small independent IT retailers and businesses

It's FREE. Join the Shop Talk community and get advice on how to build a better business.

Contact Name: *
Email Address: (privacy policy) *
What's your greatest Business Challenge?
New to Target?
Interested in our TRADE ONLY deals?
Yes No *
 
Please type the characters from the image shown



 

Thank-You!

You will receive a confirmation email, please click on the link to confirm your email address.

Thank-You!

You have now been added to the Shop Talk blog news mailing list.

Cookie Notification: by clicking accept you acknowledge that are allowing us to use a Cookie on your computer. To read our Cookie policy please view our privacy statment here.