ETD: 959 Do refunds+ work?; Chinese Consumers; Gifts & Dec 7th annual Retailer Comparison Survey

[E-Tailer's Digest]

  E-Tailer's Digest --- Everything for the  Retailer
  Issue #0959         March 2, 2006
  George Matyjewicz, Moderator         mailto:georgem at gapent.com
  Published by:  GAP Enterprises, Ltd.  http://www.etailersdigest.com
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   CONTENTS
  [1]  Greetings
  [2]  Do refunds+ work?
  [3]  Chinese Consumers
  [4]  Gifts & Dec 7th annual Retailer Comparison Survey

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  [1]  Greetings.
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Hi All:

We have one answer to list member Jim Clauson's question on whether 
offering discounts plus work, i.e., "if you find it cheaper we will 
refund the difference plus 10%."  What do you think?

List member Jules Kaplan gives some "hands on" experience with the 
Asian way of doing business, in response to our post on Chinese 
Consumers.  The practice of tuangou is not new.

Maria Weiskott and Matthew Kalash tell us about Gifts & Dec's 7th 
annual Retailer Comparison Survey and their retail polls at their 
site.  You should participate in the survey.  They are always good.

Now, let's get to everything for the retailer.

Sincerely


George Matyjewicz, PhD
Chief Global Strategist, GAP Enterprises, LLC
mailto:georgem at gapent.com
http://www.etailersdigest.com

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  [2]  Do refunds+ work?
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Jim Clauson wrote...

 > Do "Price Difference Plus" guarantees work, i.e.,  if a customer
 >  bought a $100 stick of ram and found it for $90 somewhere else
 >  - he could get a $10 'difference' refund plus maybe another 10 %
 > of the difference -- for an $11 refund.

These promotions do work, and are especially good since the retailer 
doesn't have to advertise.  Rather, they challenge their competitors 
to run ads, which they will beat.  Usually they don't take a beaten, 
unless, of course one of the big guys decides to step on them, and 
runs a series of ads below their cost, which will be far below your 
friend's cost.  Then they get beaten.

If you factor in advertising, which usually runs 3-5% of sales, you 
will probably find this concept will allow them to come out 
ahead.   Let's assume their sales are $1 million, which means 
advertising is $30,000 to $50,000.  How many consumers will look to 
get the difference?  If the average sale is $100, that would mean 
they could have 300-500 customers (out of 10,000) asking for the deal.

It will probably work.

George Matyjewicz

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  [3]  Chinese Consumers
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I could not help laughing what you discuss Chinese Consumers, I 
really think it is more an Middle Eastern and Asian method of purchasing goods.

When I was in the military and I was stationed in Hong Kong and Japan 
the merchants had a system where if I was discussing to purchase X 
from merchant Y, and I said I was going to look for it some place 
else.  No matter where I went I was given the same price by all the 
merchants.  In the US we call that Anti Trust.

So what I learn from that experience was look around before I started 
negotiations on day one, then go back the next day to make the 
purchase at the price I wanted to pay.  It was a fun way of buying 
but in today's market I would not do that, I do not have the time.

The gang purchases was also done by a team of my friends if we were 
looking for example to buy a camera.  We would go in teams and drive 
the merchants nuts for one would go to one stall and another one of 
us would go to another stall until we got the price we wanted.

So it is an old custom.

Jules Kaplan
Inovium Corporation
http://inovium.com
A web base account receivable management system.

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  [4]  Gifts & Dec 7th annual Retailer Comparison Survey
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Gifts and Decorative Accessories is asking you to take part in our 
7th annual Retailer Comparison Survey. The results of this survey 
will be published in our June issue. All responses are combined; no 
individual responses will be identified or published.

If you have not already answered the survey sent to many of you by 
mail in early February, please help us by completing the online 
version today. To begin the survey, click here 
http://www.researchtodayonline.com/data/GDARetComp06.htm

Also, at our site we have "Your 2 Cents Worth" polls.  Last week the 
poll told us what holidays (besides the biggies in December) direct 
the most revenue to your store. This week, we turn from holidays to 
other special occasions when consumers are looking for a great gift. 
Go to www.giftsanddec.com to participate in this week's poll, and 
offer "Your 2 Cents Worth."

Regards,


Maria Weiskott, Editor In Chief
Matthew Kalash, Managing Editor
www.GiftsandDec.com

+++ [Moderator's Comments] +++
Maria Weiskott has taken on the job of Editor In Chief after our 
friend Quinn Halford retired.  We are looking forward to more retail 
news from Gifts & Dec.  As we all know, I wrote a column for that 
magazine for five years.

George

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