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Retail Chains To Strike Back Against Online Vendors
Hugh Pickens writes "Marissa Taylor says the retail chains' worst nightmare are consumers who come in to take a look at merchandise in-store, but use smartphone apps to shop for cheaper prices online. But now stores like low-end retail chain Target plan to fight 'showrooming' by scaling up their business models and asking vendors to create Target-exclusive products that can't be found online. 'The bottom line is that the more commoditized the product is, the more people are going to look for the cheapest price,' says Morningstar analyst Michael Keara. 'If there's a significant price difference [among retailers] and you're using it on a regular basis, you're going to go to Amazon.' Target recently sent an 'urgent' letter to vendors, asking them to 'create special products that would set it apart from competitors.' Target's letter insisted that it would not 'let online-only retailers use our brick-and-mortar stores as a showroom for their products and undercut our prices without making investments, as we do, to proudly display your brands.' Target also announced that it had teamed up with a handful of unique specialty shops that will offer limited edition merchandise on a rotating basis within Target stores in hopes of creating an evolving shopping experience for customers. Target is 'exercising leverage over its vendors to achieve the same pricing that smaller, online-only retailers receive,' says Weinswig. 'This strategy would help Target compete with retailers like Amazon on like-for-like products.'"
This has been done in the UK for some time, though for slightly different reasons. Having exactly the same product aside from it having a different model name/number used to be something a couple of camera manufacturers used to do for Dixons/Currys/PCWorld. It meant that price-match offers could be very generous (Found it cheaper elsewhere? We'll refund three times the difference!), because they would never need to pay out as no one else carried that exact model (well, they did, but with a different label) except those three stores which always had it at the same price as they are all owned by the same parent group.
A lot of places that do price matching already do this.
It'll be SKUs #####A, #####B, #####C.
Retailers #1, #2, #3, each get the respective SKU, despite being an identical product. And when you try to price match they won't as it's technically a different item. Of course they leave off how they are the only ones who sell that SKU and thus would price match themselves.
This has been going on for years in the mattress industry. Identical products are sold under different labels, with huge markups. So there is an incentive to confound comparison shopping. They don't care about customer satisfaction or loyalty, because a mattress is not a frequent purchase.
Prove anything by multiplying Huge Number times Tiny Number
So much cheaper than Kroger/Ralph's; an $80 bill at Ralph's is literally $50 at a TJs.
Don't blame me, I voted for Baltar.
now that manufacturing is all but dead
It is?
According to United Nations data, the U.S. is still the largest manufacturing country in the world. In 2009, American manufacturing output (in real terms) was nearly $2.2 trillion. That's about 45% larger than China's, at just under $1.5 trillion.
Can China compete with American manufacturing
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Actually, that's just the opinions of slash readers. Target explicitly said they wanted unique, special products that made them stand out from the commodity market. Failing that, they want their vendors to give them prices which allow them to compete with the online stores. Check out TFA, it is very informative.