Sign Up

Information Superhighway Robbery

Even if your staff actually knows the products it is selling, how do you compete with online retailers?

August 21, 2000

Even if your staff actually knows the products it is selling, how do you compete with online retailers?

Understandably, most people feel rather uneasy about plunking down several hundred dollars for a new computer, TV set or any other kind of electronic gadget. The fact that technology is changing so rapidly only heightens the anxiety. No wonder people still want to go out to their neighborhood electronics store to check out the goods — even when they can buy them with a mouse click over the Internet at home.

Take Graffiti Audio-Video, our neighborhood electronics store. The sales staff really knows their merchandise — and does a great job explaining all the intricate features and options, the pros and cons on each and every machine displayed on the floor. Even more surprising, considering the level of service, the store offers very competitive prices. The loyalty of their clientele has helped the store weather the onslaught of online retailers during the past few years.

But how much longer? Even with the recent demise of dot-com bit players like Value America and with stock price of Internet powerhouse in a virtual free fall lately, the safe bet is that “e-tailing” is here to stay. And, sure enough, electronics customers are showing up at our neighborhood store armed to the hilt with information and prices obtained by surfing the Web.

I recently had the rather unpleasant experience of waiting in line behind a customer who wanted to know all the details about a particular stereo component, asking question after question about its various features and how it stacked up in terms of quality and price against other brands.

Being a slow Sunday afternoon and facing such a barrage of questions, the lone salesperson did the best he could to answer all of the questions and get on to the next customer. Still, despite all the attention, the inquisitive customer would not make up his mind.

Soon, three or four other customers were impatiently waiting. Just when we had decided to interrupt, the customer finally declared that he had made his choice at last. The salesperson was as relieved as we were.

“Just one last question,” the man then said casually. “Store policy is to match anybody’s price on the items you have in stock, right?”

“Yes,” the salesman said warily. “We do match the prices of other retailers. What other price quote do you have?”

“Well, before coming here, I did some research on the Internet and I found a great price for this particular component.” As he said this, he handed the salesperson a computer printout of the web page.

The clerk looked at the page in disbelief, then trudged off to get the store manager. “That’s more than a third off our price,” the manager explained to the insistent customer. “What we really mean is that we will beat any price offered locally.”

In the end, the customer browbeat the store into offering him at the Internet price. For the other customers present, it was an ugly scene. The unspoken agreement seemed to be that you shopped here and expected to pay more for the quality of service. By not offering that personal touch, Internet firms are able to aggressively undercut traditional retailer’s prices.

As the clerk stepped into the stock room to retrieve the customer’s purchase, I asked the man why he hadn’t bought directly from that Internet company? Surely that would have saved him — and the rest of us — plenty of time and effort. Not to mention the agony of the poor clerk.

“There is a reason,” he began, apologetically. “It’s a little embarrassing for me to have personal items like this shipped to the office. And I just don’t have any time these days to wait around the house for the delivery company to bring the package to my doorstep.

” In the end, I decided it was a better use of time to research the best price available on the Web, then come here and hold their feet to the fire.”

I was not convinced by this line of argument. It seemed to be a matter of short-sightedness. With many more customers like this man, my neighborhood store would soon be a thing of the past. Then this man and myself will truly have to shop around.