B&M vs Online Pricing

[Diggerboy]

Hi folks,

There is some overlap with my recent post in ecommerce forum, but I wanted a focused B&M retailers strategic response, rather than seo/technical - please ignore/delete thread if this doubles up on other responses:


I have just bought a B&M musical instrument shop selling a wide range of instruments and accessories. Very strong supplier roster.

No on-line sales at the mo. The shop itself has great margins and sells well, but its prices can't compete with those found on competing websites.

I want to develop an ecommerce store using the suppliers I have in place, but I know that to compete I'll have to price appropriately - ie. Maintain strong shop prices and sell the same gear on-line at a much lower price.

My main concern is how to run the two together - If the b&m shop is called XYZ, should I run "www.XYZ.com", or try and disassociate from b&m? How do people do this and get away with conflicting prices?

Or do I set up a separate site with no association with the shop at all? (Still selling same stock)

Thanks in advance for your opinions.

 

[deadgoodundies]

Personally I'd call it something completely different otherwise you will end up with customers coming into the shop and asking for the same price as on the website and then getting annoyed if they can't.

 

[groovyjon]

The downside of disassociating your website with the B+M shop is that you're missing out on a great marketing channel to drive local people into your shop - people that don't want to buy online for whatever reason, or want to try before they buy.

We're in a similar situation. We have XYZ shop and www.ABC.com website, but we do make a clear connection between the two. Where there is a price difference (about 5% of our products) we put a message on the web page saying "this is a web-only offer and may be available at a higher price in our shop". People still come into the shop having completely missed/ignored the message, but at least it's there.

 

[SellerExpress Ltd]

This is something that even the big companies are struggling with. As an example, if you compare HMV in store prices with their online prices and you'll generally see a big difference. And this is not helped by mobile apps like Redlaser which make comparing in store prices with on line prices instantaneous.

As a musical instrument retailer, your bricks and mortar store has a huge advantage over online retailers. The level of value you add through products demos, ability to try in-store, after sales care/ repairs, spares, etc is difficult if not impossible for online competitors to replicate.

A friend of mine runs a bricks and mortar music store and they really go above and beyond to build a reputation for added value and customer service. A few weeks ago, there was a jazz band visiting town for a festival and their band van was unfortunately torched by vandals. Once this shop heard about this, they immediately contacted the band, invited them to their shop and gave them free loan of whatever instruments they needed to continue. It generated great publicity and goodwill. And I think it helped build camaraderie and loyalty with local musical community. Just one example of why I think bricks and mortar music stores can offer better service than online.

Of course there is the possibility that people will use your B&M store to browse, touch and feel, try instruments, take up your valuable time & opinion, only to walk out of your store and purchase online cheaper.

For that reason I would brand the online store differently and pitch at a cheaper price. Keep B&M offering service orientated and pitch added value to customers.

 

[WesternComms]

I've run a business where the website mirrors the name of bricks and mortar concern.

What I found is that, given we employed a strong sales process, many of our sales bought there and then and hadn't gone into a great deal of mixed media "shopping around".

Also, due to the nature of what we sell a "google search" of our produce would yield pages before us any number of virtual companies from whom the customer would have to wait for the item and wouldn't have the advice and service that I'm assuming is a good part of the musical instruments trade.

Worst case scenario is that someone says its "£X" on the website. Assuming the supply chain is the same you can match the web deal instore and they're even happier.

Just my thoughts.

 

[Diggerboy]

Thanks a lot everyone - great points and lots of thinking to be done.

Guess there's scope for us to run 2 shops online - one to mirror the B&M shop, and one with a different name and cut-price instruments?!

 

[KidsBeeHappy]

I've run a business where the website mirrors the name of bricks and mortar concern.

What I found is that, given we employed a strong sales process, many of our sales bought there and then and hadn't gone into a great deal of mixed media "shopping around".

Also, due to the nature of what we sell a "google search" of our produce would yield pages before us any number of virtual companies from whom the customer would have to wait for the item and wouldn't have the advice and service that I'm assuming is a good part of the musical instruments trade.

Worst case scenario is that someone says its "£X" on the website. Assuming the supply chain is the same you can match the web deal instore and they're even happier.

Just my thoughts.

The John Lewis Philosophy - works for them.