May I coin this term ORP for Online Retail Price. This is no statutory term but is the MRP killer bleeding the brick and mortar Goliaths with all its speed and size.
We know and we hear traditional retailers crying foul and Best Buy today is one such case of so called show rooming – https://bit.ly/1awac8i (There are show rooming apps available!)
Off late the retailer have been trying a price match strategy for festive occasions but I doubt it, as wafer thin margins can’t sustain you on ground, online yes it might (Think Amazon)
There is no stopping to it, ORP is growing fast and will grow bigger because of the advantage built in the business model itself.
The question I want to put today is why ORP and MRP can’t co-exist, at least “live-in” if not marry?
Why it has to be only ORP vs. MRP? (MRP is seen as list price in the west)
If they at least live-in, I think the following could be a possibility for retail biggies like Best Buy:
Cash on Show rooming:
Have a big board/Store UX saying we sell online too. Re-do those price tags, may be like the one below:
If Customer is a show roomer (Learn how to id them):
Catch him/her, bill the ORP price and Send the order to a partner e-store (Share revenue with tracking mechanism in place). Supply paid customers to e-stores. It’s likely, they can’t refuse ready money which is free of cost. True, there is share involved and a Win-win or WIN-WIN will depend on how it’s contracted, how cost of sales is managed and off course if you believe it’s better than a price-matching race.
You deliver the product experience, acquire the buyer. The online guys can be your warehouse/fulfillment center.
Think of managing an analog supply chain and also a digital supply chain.
What happens to my MRP sales?
You cut down on total loss of show rooming revenue and customers who want to own a buying experience immediately will buy, brick and mortar wallets will stay till they stay. A lot is up to you as you have two cards to play with now. It’s advantage ORP sales vs. Zero MRP sales.
Hire a show rooming revenue manager for highest ORP revenue 🙂
According to your product mix, margins and targets you can have a pro-MRP strategy or a pro-ORP strategy. Each retail marketer irrespective of size can try their own mix.
How do I know s/he is a show roomer? A lot will depend on it.
True, thankfully they are in good numbers to drive volumes (Best Buy would attest) and yes a lot will depend on id-ing them and billing them. Your Sales peeps need to profile them for intent, influence and sell. Train and support them with technology.
How do we do it?
Technology – that’s the answer. An integrated CRM, an ORP vertical in CMS, smart id-ing technology at the least. Some big tech folks are working on retail technology. They are working on some in-store BI, like buyer movement in store, if they are picking up something and so on. That’s a good direction in profiling.
Sure, it’s also a strategic decision and needs a re-think on the marketing and sales process to begin with.
The last word : Consumers buy, you sell. Let’s find ways.
May be you know: Amazon has drop boxes in physical stores and amazon pays for that. That’s finding a way- https://bit.ly/storelocker
I invite your views.
(This discussion only covers the show rooming aspect of retail and I will try to add more on other aspects)
asha chaudhry
hey tapash,
your post was shared on trhs fb page – there is this comment – would u pls respond?
https://www.facebook.com/TheRodinhoods/posts/617806591616438?comment_id=5349826&offset=0&total_comments=1¬if_t=share_comment