To Go Where Your VisionPoints, a few inspiration points for you and your business.
Suppliers and especially manufacturers have market power because they have information about a product or a service that the customer does not and cannot have, and does not need if he can trust the brand. This explains the profitability of brands.
The department store salesperson who created such a great Customer Experience for me (in yesterday’s post) had information I did not, for sure. I’d had the usual sales conversations with other folks in the weeks surrounding that trip, and no one had shared this info with me.
Yesterday’s post also prompted a few discussions off this site, confirming that I am not the only shopper who’d never heard of the method some stores use to keep some items on near-permanent sales. (When I worked as a retail buyer, we knew there were rules against permanent sales too, so we switched back and forth between similar items the way your grocery store switches between sales on Coke and Pepsi. But to sell the same item, with a different covering… surprising!) Good to know it’s not common knowledge that I’d missed, but it did make me think back to this old quotation from Peter Drucker.
While it’s true that there is power in knowing that an item will remain on sale forever, more sales power was given to the knowledge (in the case of this undecided window-shopper) by sharing it. Now I know that rather than having to decide-quick-or-find-another-store, I can decide slowly and come back to this store, the store where the staff was so helpful.
I don’t think this means Drucker is wrong, though. Instead I think it has to do with the second half of his statement—the power of brands.
In many industries, the power of the brand is essentially gone. Too many choices which are too similar, and are available from too many locations online and off, means that the item of your dreams comes down to intangibles—like Customer Experience.
Put another way, there are many industries in which the “brand” no longer sways sales as it once did.
Where Drucker misses the boat, for me, is in making a blanket statement about brand trust. Sure, I may trust a Cadillac more than a Hyundai (your customers still do make a lot of assumptions about price and quality), but if we’re looking at items in a similar price range many folks will do their research online and trust no one offline, no matter their name.
The market power that may be in trade secrets is no longer yours because you hang on to it tightly. It’s very likely that your brand doesn’t have that pull now.
With today’s customer, the power may be in giving that insider info away.
Grow and be well,
P.S. If you enjoyed this post, I hope you’ll subscribe by email or by RSS (it’s free!), and link to it, Stumble it, or otherwise bookmark using the “Share” button below.