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| Subject: Why Isn't Back-to-School a Subscription? | |
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Author: Dennis S. Vogel |
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Date Posted: 16:59:01 09/29/10 Wed The Advertising Age article cited below prompted me to expand on what I published before. Why Isn't Back-to-School a Subscription? - CMO Strategy - The Season's Missed Loyalty Opportunity by Jonathan Salem Baskin http://adage.com/cmostrategy/article?article_id=145537 As of today 09/20/2010, this article was still available to registered visitors. Except for the Henry Ford quote, the content in quotation marks below is from Jonathan Salem Baskin's article. Writing about retailers, Baskin wrote, "Their marketing presumes that they've never before met their customers, and as if this year is the first time their target audiences have gone shopping for school stuff. The ad creative is frighteningly similar across brands, evoking variations on the theme of 'we have low prices on whatever you're looking for.'" Too many retailers think too little about what consumers want/need. Yet, those retailers are surprised how seldom consumers think about what they can buy to gain more benefits. If retailers don't know why certain people (market niches) would prefer some offers more than others, why would they expect consumers to learn & remember what a store stocks? Low Price, But What About Value & Benefits It's too easy to rely on price cuts. Cutting prices doesn't explain why an offer is superior for people in specific situations. Jay Abraham (http://www.abraham.com/) advises explaining benefits & giving reasons for prices, whether prices are higher or lower than competitors' prices. Jeff & Marc Slutsky (Street Fighter Marketing www.streetfightermarketing.com/) advocate preserving price credibility. Price credibility means a business owner is serious & is perceived as serious about charging fair profitable prices. $XYZ Or Best Offer As people haggle more for lower prices, imagine retailers saying, I can't afford to lower prices. Prices are justified by product quality. Prices are firm, unless of course, you want to pay less. It's just like continually using discounts to spur sales, except the haggled prices aren't advertised. Baskin wrote, "Customers could enter the items they're interested in replacing far earlier in the year, and perhaps there's a group-buying function, too?" When people ask for discounts, a retailer can say, some employers & nonprofit groups arranged for pricing programs. If your group makes mutually beneficial arrangements with my store, you can participate in a program too. Nonprofit groups, employers & unions can qualify their workers/volunteers/members for programs like that. Discount programs can be used as rewards for working productively & employment longevity. The groups, employers & unions are responsible for distributing the offers - printing/copying the flyers or ads in their newsletters. Otherwise, retailers end up paying for - expensive - mass media advertising. Don't give away discounts - have individuals & groups earn discounts. Part of earning those discounts is letting them pay for the ads/flyers. When people complain they don't get a discount after somebody else got a discount, retailers can tell complainers what that somebody did to get the discount. Complainers can talk to employers or group leaders about getting that preferred treatment. It's a form of referral marketing. Note- I tend to avoid the term word-of-mouth advertising or marketing. It's not advertising or marketing unless it's organized/managed as referral marketing. Form templates can be created for people to use. Those forms will help consumers organize their purchasing & retailers can use those forms when they order merchandise. Each participating family can use a form to decide what they'll buy. Completed forms can be received via email or web pages. Shareware/freeware survey programs & web based services could be used to make forms & process answers. Have paper copies available for technology challenged consumers. Let people print copies so they can do inventory at home. It could be done via the Internet/email. Retailers may be able to copy & paste what people submit. People will be grateful for the easier buying system. Since forms would be optimized for a particular retailer, people who use them are apt to patronize that retailer's store. After customers use the system, retailers can get suggestions for improving it. Unfortunately as Henry Ford said, "If I'd asked my customers what they wanted, they'd have said a faster horse." People don't always know what they want or need, until they get it. Even after they get it, it may not work optimally for a while. Where To Start Is it better to plan from the end result, then work back (The 7 Habits of Highly Effective People by Stephen R. Covey - Habit 2: Begin with the End in Mind)? Or is it best to plan from the beginning & work to the end result? The answer is the same for both - Yes. Start determining what's available from vendors plus what customers want & can afford at about the same time. Retailers can work both ends toward the middle. Ask consumers for a no-obligation realistic assessment of what they'll need & their budgets. It's important to emphasize being realistic. If the program turns out to be too much trouble, it'll end. At the same time, retailers should start gathering information from vendors about what they plan to offer. Retailers can match the results of those consumer forms & vendor lists. In the 1st round assessment, consumers would determine what they'll need/want in general. Example: Boy- 2 shirts medium size 12-14. Girl- 3 pants size 8/10. Estimated budget- $200. As consumers do that, vendors would show a retailer what they plan to offer, the prices & a shipping date. Based on the retailer's business model, trade skill & financial needs, s/he can determine what to stock & set retail prices. These programs can be a form of research. What people order - in advance through those programs - could be indicative of what other customers will want. Via a web site link &/or a printed sheet or booklet, the retailer can show people in the program what will be available & how much they should plan to pay. With a general idea what they can buy without exceeding their budgets, customers should have fewer surprises & less stress. Determining whether a prepayment or deposit will be required for the orders shouldn't be a deal breaker. If suppliers demand prepayments, retailers can blame them for the requirement. If 200 people are expected to buy a product & 50 of those are in a program, the shipping charges will be partially borne by the program. When the chosen products arrive, people in the program can use members' lists to pull out what members ordered & group those products together for each family. When they do it, they'll save the retailer expenses for promotion & labor. Since program members do some work, they exchange efforts for lower prices. Their time investment would probably be relatively low. Instead of frustrations of regular shopping, members' time would be spent getting what they already chosen. They don't need to wait in long checkout lines. They won't be frustrated by out-of-stocks. Return policies could the same or adapted for the program. Dennis S. Vogel thrivingbusiness@email.com Your success depends on knowing consumers well enough to offer the best value they need in their situations. Tips about that & other great marketing in my free information web site & blog can help you with those details - http://www.lakefield.net/~thrivingbusiness/ http://www.voy.com/31049/ [ Next Thread | Previous Thread | Next Message | Previous Message ] |
| Subject | Author | Date |
| Can you stablize your profitability with subscriptions, continuity programs or until further notice offers? | Dennis S. Vogel | 17:35:34 12/29/10 Wed |
| All Work & No Play Makes Jack A Dull Boy | Dennis S. Vogel | 17:34:59 01/30/11 Sun |
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