Wednesday 27 March 2013

Au shop charges $5 'just looking' fee

                                                                                               pic: Reddit Barrett Fox
In a bid to combat show-rooming, a speciality food shop in Brisbane allegedly charges shoppers* Au$5 per visit, deductable from a purchase, or non-refundable if 'just looking'...

Apart from being a real test of retailer pulling power, this move raises the issue of how retailers and their suppliers can satisfy an obvious consumer need to 'touch the product' before buying, without compromising retail pricing.

In categories such as toys, consumer electronics but also speciality food and drinks, it obviously benefits the brand if consumers are given the opportunity to visit a specialist shop to experience the product and seek advice before making a purchase. However, the resulting on-cost usually makes it impossible for the retailer to compete with online prices for the same brand.

More intensive branch calling and support can obviously increase the efficiency of a specialist retailer. However, given the relatively low turnover of typical specialist outlets, it is usually not possible for a supplier to break-even via orders taken at store level.

A possible solution for brand owners could be to treat the specialist shop experience as an extension of the marketing process, and fund it appropriately. 

In other words, given that any support at point-of-sale can make ATL advertising more productive, then why not write off say 50% of the cost of branch support to the advertising budget? This additional funding could be used to cover part of the cost of calling and also the provision of 'demonstration' allowances for the specialist retailer.

This would allow the supplier to influence the point-of-purchase message to ensure compatibility with overall brand positioning, enhance the consumer-service and allow the retailer to reduce the online price-gap....

When you think about it, a variant on shopper marketing, for the little specialist guys...

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