The battle for consumers’ wallets reaches boiling point
Posted Dec 19, 2013 7:11 am.
This article is more than 5 years old.
Expect to see some deeper discounts and an all-out price war the closer we get to Christmas.
Retails have engaged in an aggressive feeding frenzy for their share of shopper’s budgets and they’re being forced to become more inventive than ever before.
It all has to do with things like the advent of online shopping and media saturation.
Loyalty One Vice President of Business Development Graham McVie has found in order to drive customers to their stores, retailers are shifting away from trends like Black Friday, in favour of extending those sales for the entire week.
“Retailers are terrified they’re going to miss out on these shoppers who are in a buying mode, they’re going deeper, they’re pushing it more and more from a marketing perspective to try and get a share of traffic into stores,” he says. “So you can get a bigger share of shoppers spend during this crucial period of the year.”
McVie, whose company runs Air Miles, says they’ve noticed some interesting phenomena in the almighty push for your dollar.
For starters, dynamic pricing has become more prevalent.
“Retailers historically would put one price out there for the month because there’s a cost out there with changing the price on the shelf and getting the store to change it,” he explains. “With online, prices are changing much more frequently, especially as we get closer to Thanksgiving (U.S.) and then again as we ramp up with Christmas, it’s intriguing as to whether or not we’ll see any consumer backlash.”
He says they’re also using personalized pricing, tailoring their discounts to an individual customer and whether or not they’ll like a particular product through a loyalty program.
“They’re going to feel like this retailer knows me well, they’re giving me tailored offers and tailored pricing; therefore my trust in them will go up and I will reward that retailer with a greater share of my shopping spend,” McVie explains.
According to the shopping expert, there’s going to have be some changes made in order to control the “bleed.”
“Retailers are inclined to want to go very deep on these discounts but we’re finding they could not sustain that from a financial perspective so what they’re now trying to do is be a little more selective in terms of what products they discount and how deep they discount,” he says.
They’re also reportedly restricting the times and quantities that are now available.
“What we’re also finding this year in terms of shopping tends is a lot more shopping online, online sales have increased dramatically compared to gimmicks like Black Friday because of things like shopper fatigue,” he says.
