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How To Become Internet Proof

Posted On - 28/01/2014 15:17:21

Understand What the Internet Can't Do
This workshop video continues our series on Price Competition. In it we take a close look at a special case: the internet. The internet deserves special attention because it's so price aggressive. So much so, you likely feel you can't compete with it.

But while the internet might wipe the floor with you on price, you wipe the floor with it on many other things. Things that are key to how many people choose where they do business.

So when thinking about the problem the internet poses, don't just think about what it excels at, think about what it fails at. Focus on getting to know how the internet works and what it's flaws are. Because if you do, you can beat it. You can take all the brouhaha surrounding the internet and see it for what it really is. That's what this video looks at in detail.

Look at the internet the right way and you'll see it for what it isPeople assume the internet is competition. But is it? We've heard customers claim 'everyone is competition' but is this right? We don't think so and here's why.

Look at it this way: there can only be a competition over something that can be won. If customers prefer to use the internet because of prices you can't match there's no contest is there? The internet is simply not a competitor. You're competing for different things.

What the internet is is an alternative for people who value price over what you offer. You can't compete for these customers: they don't want what you offer. The internet doesn't represent customers you can win, it defines a part of the market that is out of your reach.

But whether the internet is competition or not, how is it so price aggressive? It's generally believed this is so because the combination of ultra-low costs and huge reach means it can work at rock bottom prices. And while these things are true they aren't the reason for the cut-throat behaviour that's the trade-mark of ecommerce.

No, the reason the internet is so very price aggressive is because it has to be. With no other way to stand out, online traders have limited options to draw sales. So limited in fact price is pretty much it. And the more they use it, the more they have to. Be under no illusion while the internet presents a low price alternative to you, it comes at considerable cost. So the next time you're cursing and envious over the internet's pricing, just remember they aren't pricing like that because they've got it easy, because they can, or because they want to, they're pricing like that because they have no choice.

When people speak, hear what they're really sayingBut customers don't care who's under what pricing pressures, they're just shopping. How does any of this help with the dreaded "I can get it cheaper on the internet"?

Well, what's been said so far doesn't do that much but the video goes on to explain, word for word, what to do. Before we get to that though there's something else to think about. Because when you get the internet pricing challenge you must understand why it's more of an opportunity than a problem. And why instead of getting that sinking feeling, you should be hopeful and optimistic.

If someone presents themselves making the claim they can get it cheaper online what are they saying? If you ask yourself why they might have bothered to come and tell you this, you start to get at the answer. The issue is if the internet were so good they would have already bought - and you'd never have seen them. But they haven't and you have.

In other words, there must be a problem, a barrier that's stopping them from making those clicks. Maybe they can't get it quick enough. Maybe it's not available in the right colour. Maybe they want to buy from you but are just trying to get some leverage. Maybe… you get my drift?

The fact they're standing in front of you is a really intriguing situation. One in which you're much more advantaged than you think. The real issue to discuss with them isn't pricing, it's finding out what the how much solving the problem is worth. In other words, your conversation mustn't major on 'how much do you want me to pay you to buy'. You have to talk about why they're making the purchase. So ask the good old 'can I ask what you'll be using it for?' question and get to the bottom of what's going on.

But if this doesn't convince you to to put discounting to one side, try these two genuinely critical reasons.

Don't destroy your reputationFirst, earlier blogs have spelt out how discounting gorges and devours your profits. About how it's a great way to lose money fast. That 10% off the £200 ticket might seem innocent and small - you can live with giving away £20 to get a £180 sale. Problem is if your profit was £40, you now need to sell twice as much just to make up for what you've lost. And how likely is that?

Second, price match and your offer becomes the same as theirs. The instant you do this any worth to your advice and expertise goes out the window. In one fell swoop that simple act of price matching proves everything you stand for is worth nothing. Worse, it shows you a fraud for ever trying to pretend it was. You simply can't use price like this – it contradicts and destroys your reputation. And it puts a beacon on you as a 'push-over'.

Now while it's easy for me to say that your're the ones looking people in the eye and defending your position. But doing this isn't as difficult as you might think. Like so many things it's about mindset and going about it the right way. What matters is having a clear understanding of your value and how to articulate it clearly. This isn't - to paraphrase - the 'personal service from people who care' answer it's so easy to default to. It needs to be far more practical and concrete. And it can be. In the video we cover this off in detail with word for word explanations of what to say. If you'd like to learn the seven killer phrases you can use to protect yourself take a look.

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