Discounting – what’s your strategy?
It’s tempting in a recession to cut prices, especially when your competitors are doing the same. But it’s a slippery slope and Foyle’s bookshop appears to be thriving while adopting a full-price policy. Its Chief Executive Sam Husain (see The Guardian Sat 13 March 2010) believes discounting invariably compromises quality. Instead, he’s focused on improving the customer experience and creating the optimum shopping environment. This includes:
- a piranha tank in the kids section
- 2nd hand vinyl records in the music section
- live jazz in the shop’s cafe
At the height of the downturn, Husain refused to lay off staff or slash the marketing budget, claiming that, “the value of a book is not in the price. Price is one element but it’s about the service, information, the bookseller’s passion for books.”
Last year Foyles turned a pre-tax operating loss of £115k the previous year into a profit of £80k.
Coincidentally, Seth Godin’s blog today covers the same theme, how to make a bookstore different. He cites the Montague Bookmill in Massachusetts, and applauds its strategy of simply being, “a place, an attitude, an approach to an afternoon.”
I’m writing this in the branch of a well-known coffee shop chain, one that’s lost a lot of market share in my home town to Caffe Nero. Once again today, the girls here served me quickly and the product was fine, but they do it with no soul, no passion, no love for what they do. They never chat to you, never let their personalities feed their ‘performance’.
Some businesses really get the fact that it’s the experience that counts. Protect your prices if you possibly can and add value wherever possible. It just takes courage and a little imagination.