New Ways Retailers Will Try to Stifle Online Bargain Hunters

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Retailers have a love-hate relationship with the way consumers shop online nowadays. Stores love how easy it is for shoppers to search for and buy stuff 24/7, and love how easy it is to entice shoppers into buying via special coupon codes and promotional discounts, but hate how easy it is for shoppers to avoid paying full price via those same coupon codes and special offers.

We are now entering a new era of shopping, and as consumers get smarter about how unnecessary it is to pay the retail price of just about anything, retailers are trying to take the price manipulation game to the next level to ensure bigger, more consistent profits. To be a savvy consumer nowadays, you must know that retailers know what you know about pricing and discounts, and you must know that retailers will use this know-how to attempt to stay one step ahead of what you know. Know what I’m saying?

Given the state of online shopping and ubiquitous discounting, when retail prices are pretty much meaningless, a WSJ story aims to help companies take back full control of the pricing of their goods. The point-by-point recommendations are presented for the sake of retailers, but consumers who understand these new strategies well will be better able to avoid getting taken. One of the strategies suggested for retailers is:

Embrace, but try to limit, the bargain hunters
… [Retailers] can offer coupon codes that are only usable a set number of times, for example, or discounts for a limited time and available only to users of the sites. This way a company can better manage how much of its product it will sell at the deepest discounts.

What this means for consumers:
In other words, a consumer may have to be quick to take advantage of coupon codes, and in many cases, these coupon codes may serve just as teasers that exist not to give you an actual discount but to attract your attention.

Another retail strategy is:

Escape the commodity trap
When sellers market products with additional features or services, they force buyers to focus on the value of the package rather than on the costs of each piece. This helps reduce price transparency. Packaging, or bundling, a product with other products and/or services, makes it difficult for buyers to ascertain the specific cost of each single item within the bundle.

What this means for consumers:
Retailers want to keep you in the dark about what prices they’ll accept for each product they sell, and companies will resort to smoke-and-mirror techniques to do so.

A third suggested retail strategy:

Clear the market
Often makers of products like sports equipment or clothing are left with surplus inventory after the product’s scheduled run or expected shelf life. Such products often end up being sold through secondary channels that offer steep discounts. But for the manufacturers, those discounts can cannibalize the sales of similar, newer models… Buying back old or obsolete material from the independent sellers, either to destroy it or ship it overseas, helps protect prices.

What this means for consumers:
Last year’s stuff is just as good as this year’s stuff, though the older discounted models may be harder and harder to find nowadays. Also, holy moly, the truth is retailers are sometimes willing to go to extraordinarily wasteful lengths to avoid deeply discounting their merchandise. Retailers are well aware that last year’s products are often indistinguishable from their newer products, but for obvious reasons they sure would prefer you to buy this year’s stuff, at this year’s fully marked-up price.

Read more:
What’s Wrong with Online Shopping