How Customers Value Products - A Social Experiment...

[Tombo46]

I've come to learn that the great British public do not understand the value of items. Especially if they have nothing they can directly compare it with. I was trying to explain this to one of my staff and decided to do so with a little experiment.

I am a greengrocer/florist and I sell a lot of plants during the summer months. We are just starting to get back into the plant job and things are a little slow this year. I had some alpines that have stuck for a good 3 weeks. Total amount of plants in the tray is 18. Upon starting this experiment there were 15 left. I priced these at 69p per plant which is exceedingly cheap.

A few other plants were starting to look a bit leggy so I decided to reduce them all so I set up a little "reduced to £1" section. I decided to put the 69p plants in with the rest of them to see how things went.

As I thought, at the end of the day, NO PLANTS remained. This just goes to show than British shoppers would rather be told they are getting a bargain and pay more for it than look at something and decide whether or not it is of good value.

This is one of the reasons supermarkets sell so much gear. Everything is 2 for 1, Half price, Reduced, buy 2 get 1 free and so on and so forth.

Unfortunately I can't bring myself to price my produce like this. I have the odd line which I will state the usual price of the item, or something do a "2 for" but only when it is a GENUINE line not simply because it sells the product better.

It always amazes me walking through the supermarkets how everyone blindly believes that those strawberries should have been £3.98 a punnet and no one thinks for a second that £3.98 is exactly double £1.99, a popular selling price...

Maybe its because I own a business, but every time I see these "offers" I can't help but think "If that's what they were charging before then they must have been on 100% mark up even if they are now working at cost (which they aren't), I don't want to deal with anyone who's making that much money out of the job".

 

[Cobby]

Maybe its because I own a business, but every time I see these "offers" I can't help but think "If that's what they were charging before then they must have been on 100% mark up even if they are now working at cost (which they aren't), I don't want to deal with anyone who's making that much money out of the job".

The one that always amuses me is the offer on supermarket wine. A whole aisle-end stacked high with "Suchandsuch-Hills Cabernet Sauvignon: Previously £9.99, reduced to £3.99".

In some supermarkets the aisle-ends will turn over a peak of several thousand pounds per hour - that £3.99 bottle of wine was never worth £9.99 and probably isn't worth £3.99, so they're making a bucket-load on it. Sadly the general public have difficulty engaging their brains.

 

[TPSOxford]

My favourite was an almost empty shelf of hummus in Tescos with a big yellow promo label.

95p each or 2 for £2.

What a bargain!

 

[Root 66 Woodshop]

You just can't compete with some people...

 

[businessfunding]

I


Maybe its because I own a business, but every time I see these "offers" I can't help but think "If that's what they were charging before then they must have been on 100% mark up even if they are now working at cost (which they aren't), I don't want to deal with anyone who's making that much money out of the job".

Most of what you say is absolutely true; it would be great if we could teach people to understand value rather than price but, decry Supoermarkets as we will, they do have an extremely good lever on the pschology of buying so are always worth watching.

I also don't agree the philosophy of 'if you're making money it must be poor value' - which again goes against the concept of understanding value.

 

[John_Orcus]

Our software has a number of features for outputting shelf edge labels and suchlike based on 'previous' and 'current' pricing.

This all works fine as long as the user remembers to select the right pricing in the right order before clicking on the 'print' button.

What is surprising is that even when it is cocked up, many customers don't even notice that they are being asked to pay more, and blindly buy it anyway.

 

[90DC]

My favourite was an almost empty shelf of hummus in Tescos with a big yellow promo label.

95p each or 2 for £2.

What a bargain!

Then when you scan your Clubcard, they know you purchased two, look back at the CCTV, laugh at you picking two up and send you vouchers in your next Clubcard statement with a similar offer.

Tesco deny any deliberate intent when it comes to cases like this, but you must question why anybody would pick up an item on such an offer. I've had a more appealing offer, £2 each or three for £1 on Heinz tomato ketchup, was never supposed to be that cheap, so I can understand it probably is just error.

 

[Root 66 Woodshop]

The local Co-op shop had a special offer on Lucozade last week, £4.99 for 12.

When I went to the counter, I was asked to pay £4.25 for 12... I pointed out that the offer stated £4.99 and I was told (believe it or not!)

You're moaning over 74pence?!

No, I wasn't moaning, I was pointing out a mistake that they'd made at the till... but hey, who am I to complain?!

 

[90DC]

@AuthorizedAccess - That's happened to me before, too. I don't understand the response, but nevermind. They'd show more care if they gave me £10 change instead of £5, but I wouldn't bother letting them know.

 

[David A]

@AuthorizedAccess - That's happened to me before, too. I don't understand the response, but nevermind. They'd show more care if they gave me £10 change instead of £5, but I wouldn't bother letting them know.

We are drifting off-topic, but some time ago I was at a sub-post-office and asked for as many first class stamps as possible from a £10 note. I realised that the counter clerk was making a mistake with her addition and giving me twice the number of first class stamps than she should have.

I had also noticed the ubiquitous notice often found in shops along the lines of 'please check as mistakes cannot be rectified once you have left the counter'.

I left the counter, then returned pointing out the notice and the manager who overheard stepped in and assured that this was shop policy. To which I then explained that I had been given too many stamps, so was very pleased that I could keep the extra.

His face was a picture.

 

[90DC]

Maybe its because I own a business, but every time I see these "offers" I can't help but think "If that's what they were charging before then they must have been on 100% mark up even if they are now working at cost (which they aren't), I don't want to deal with anyone who's making that much money out of the job".

Lol @David A,

Going back to the original point and in particular, the one highlighted, I've seen offers such as this one in ASDA, Tesco, Sainsburys, Morrisons and the Coop, but I don't see it employed by the local greengrocers, butchers or bakery, who would prefer to keep their prices relatively static.

Maybe that is part of the appeal when it comes to supermarkets, you feel like you're receiving a bargain, but there are cases where you don't.

A notable one at the moment, one of these supermarkets is doing an 'offer' on Persil small and mighty non-bio liquid blah (54 washes). In the supermarket, it is reduced from £14 to £6, online it is reduced from £10 to £6. This usually retails between £9 and £10, but the major supermarkets often reduce to £6. I never buy it at more than £5 (Infact, I stockpile it a little when I find it), but walking around the supermarket and seeing how many people must have picked it up because of the apparent £8 saving.

Modern retail seems to be a lot about the unbelievably 'huge' savings and I am sure supermarkets do very well from their B1G2Fs, the SAVE 70%, the 2 for £1s, but have small independant retailers fallen behind? Could they successfully employ these kind of tactics?

The idea of Buy One Get One Free appears to be dead or dull to some people. Particularly in supermarkets, I've seen the shift to marketing products as £3 each or 2 for £5, when a product would only normally cost the consumer £2-£2.50 normally anyway.

 

[printnstyle]

True, not only to British people but most of the shoppers. There's no way to change the trend since most of the businesses have taken advantage of this situation.

 

[Talay]

Supermarkets have won the war over perceived value and now people simply don't check the prices. Add in the fact that a significant percentage of the population is actually too stupid to notice and couldn't mentally calculate their two times table.

 

[pbsdirect]

It really annoys me at my local coop when they have the reduced stickers on almost evedy product.. Its a very small store so you would/ could not do like a weekly shop there just something for that day. But they stick reduced stickers on stuff and reduce by 20p when its on 2 for 1 anyway, and has 3 days sell by date left. They put it in a different fridge incase you miss the offer. Also at the till they have EVERY day strawberries, rasberies and blueberries with the big reduced to 1.95 sticker on even when its 2 for 4 pounds or special buy 2 pounds...