Category: Competitive Factors

Price! Price! Price!

2/16/2015

Tags: Greentoe.com, Priceline, Consumer Reports, Nikon, Canon, Olympus, J. C. Penney, B&H, B&H Photo, online discount cameras, smartshop.org

Have you ever thought about the difference between price selling and selling price?

Price selling is discounting. It’s lazy marketing. And having sale after sale after sale not only takes a bite out of profit but could be a long-term trap (just ask J.C. Penney).

Selling price is price-as-product.

An intriguing example of price-as-product popped up on my screen this morning: Greentoe.com.   Their ad snagged me because I’ve been fishing around online for cameras and lenses. So I clicked through to their site, where they immediately offered “the lowest prices available” on brands like Nikon, Canon, Olympus, etc.

“People like you are saving big on photo gear,” claimed the big green headline (the shade of money). “Set your price and save up to 20%. Brand new products. No grey market. Authorized retailers. USA warranty included.”

Does the advent of Greentoe.com mean I’ll no longer have to contend with my local Best Buy’s lackluster camera department? (http://tinyurl.com/nywuxcx) Does it mean I won’t have to risk ordering my next camera from one of those slippery big city camera discounters?

Maybe …

“Greentoe.com is the first and only website that allows you to name your own price for products in five categories: photography, appliances, musical instruments, baby items, and home theater,” reports shopsmart.org, an online Consumer Reports “best deals” resource.   They’re doing for consumer products what priceline.com has done for air travel and booking hotel rooms. And it has the same sort of intrigue. Will they accept my bid?   Will it be soooo much lower than the price somebody else paid?

Greentoe’s process is simple:

(1) Submit an offer, on “thousands of products” (and give them your payment info).

(2) “Hundreds of retailers” then are notified of your offer (a green, orange or yellow gauge helps you determine how likely they are to accept – similar to Priceline).

(3) The first retailer to accept gets the sale; the transaction is between buyer and seller.

If you know precisely what item you want, Greentoe.com may be your cup of tea – that is, if their retail partners have what you’re looking for. The site’s selection of musical instruments and pro audio equipment is far from comprehensive, but it’s not meant to be. They know that brick-and-mortar stores always have aged merchandise or overstocks they need to sell, so greentoe.com matches them up with customers who live hundreds or thousands of miles away.   Same for TVs, appliances and other products.

Their customers don’t have to be lucky or do the legwork, the company states in its well written and informative blog, they “just have to have a little luck to find that deal.” Greentoe provides the luck.

There is something else. Once you’ve punched in your payment card numbers, there’s no turning back, so if you’re at all queasy about things like that – or don’t make purchase decisions easily (like me), it might be best to buy elsewhere.

Heretofore, the place I most likely would have picked to buy a camera is New York’s B&H Photo-Video, especially if I needed help choosing the right one. B&H has it all: vast selection, attentive service, technical expertise, free advice and competitive prices. And, if you live anywhere nearby or are visiting Manhattan, you get to handle the goods before making a purchase decision. Walking into their 70,000 square foot their store is like entering a dream world of professional photo, video and audio goodies.

You can buy cheaper than B&H, but probably not as well.

To be sure, there are other excellent purveyors of professional photo, video and audio products – online and off, and some may have as compelling a presentation as B&H, but the positioning of that big store at 34th & 9th has always fascinated me.   They’re not only the largest independent (non-chain) photo-video retailer in America, they also communicate their competitive advantages clearly and set price accordingly -- unlike all too many businesses that only play the price card.   B&H.com appears to command a slight price premium over some other online camera sources, and if so, they more than earn their margins with their compelling added-value.

Greentoe.com’s selling proposition also is compelling, however, so I will keep them in mind when it comes time to buy whatever camera I decide on. Who knows? My bid price just might outweigh the loyalty I feel to B&H for sending me all those informative catalogs over the years. But then again, during the time in my life when I sold audio equipment, it always rankled me when I helped educate a prospect only to see him buy from some discounter instead of me.

It’s so easy to discount, which is the unfortunate first impulse of many businesses. In most situations, price selling is mind-numbing, profit crushing and unnecessary – unless, like Greentoe.com, price is your product.

TakeAway: Does your business or brand have competitive advantages that will attract more qualified customers and allow you to command better margins? Or are you content to sell principally on price?

Content © by Brian E. Faulkner

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People Power as a Competitive Advantage.

8/14/2014

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Image © by Brian E. Faulkner

Lowes Foods, a 60-year-old, 100+ store grocery chain based in North Carolina, has made a gutsy move: they’ve put the future of their business in the hands of their people. Their team. Their hosts -- the honorific says it all.

The moment you walk in one of their rebranded, re-cultured stores, you can feel the difference. Smiles seem to arise naturally. Employees greet you and offer their help – and seem to mean it. There’s a refreshing hustle about the place. More spontaneity. Lowes Foods leadership has managed somehow to meld procedure and belief and make it work.

“Cultural branding is really at the core, at the heart of what we’re trying to do,” says the company’s enthusiastic CMO, Michael Moore, a veteran of 28-years in the grocery business. “And what I’ve experienced a lot as I’ve gone to retailers, both in the States and overseas, is that there’s so much emphasis placed on the visual side of the equation, prettying up the store, making it a little bit more shoppable, so on and so forth, but yet there’s nothing that’s done with what we call our hosts.”

Although stores like Publix (1077 stores in six southeastern states), Wegmans (84 stores in the Northeast), Whole Foods Market (371 stores nationally) and Nugget Markets (9 stores in California) are known for getting the cultural piece right. And each rises continuously on FORTUNE’s list of the 100 Best Companies to Work For*.

Nugget Markets claims that their “positive attitude and love of people” sets their associates apart, which – in turn -- sets them apart in the marketplace.

“Our associates are the difference maker,” says Chris Carpenter, their COO and Vice President, “and it is they who separate us from our competition. We believe that when our associates are having fun and feeling valued, there is an energy and enthusiasm that is created—and it transcends right through the guest.”

Lowes Foods’ management gets that. My recent conversation with CMO Moore in one of the company’s stores was interrupted several times by cheers from people in the Chicken Kitchen celebrating completion of another batch of “chicken you’d cross the road for.”

Who wouldn’t rather shop at a store where people are enthusiastic about their work – as long as quality and selection are up to par? Personal experience is just one of a dozen or so competitive factors that set any business apart – along with service, convenience, innovation, etc. Even grocers who sell primarily on price often have other competitive factors in their favor. Aldi for example, is known for its limited inventory, quality merchandise plus low price.

But the people part likely does as much, or more, to attract and hold customers than any other single competitive factor. It’s also the most challenging to make happen -- and sustain -- in the me-saturated American culture. Disney has proven the value (and endurance) of people power for decades.

“The Disney operating style has greatly influenced our training program,” says Moore. “We believe in one of the core Disney concepts in particular, which is when we’re on the floor we’re onstage, and we want the people onstage to be delightful. We want our hosts to be rabid fans, working for Lowes, and we want our guests to feel that love – and feel that commitment and support.”

Even when my local Lowes Foods store was only halfway through its renovation, the cultural transformation already had begun taking hold. I was pleasantly surprised when a man in the produce department engaged me in conversation about the mushrooms I was buying. (see http://theproducemerchant.com/produce-stand-outs/ for more about him)

Customer satisfaction is relatively easy to achieve, because it’s … relative. Creating delight, however, is quite something else and may not even be measurable except by collecting personal anecdotes and tracking repeat business. The man in produce delighted me by offering suggestions on how to store and prepare my mushrooms. A month or so later, a young woman roaming the store with crisp watermelon samples intercepted me in the cereal aisle. Her smile alone was enough to delight. And had I not been a long-time Lowes Foods customer, either "host" would have more than counterbalanced my experience a few weeks prior with the only rude clerk I’ve ever encountered at that store (a memorable example of how not to treat a customer).

“Culture is the driver in our company in all departments,” says Lowes Foods VP of Fresh Sales Chris Van Parys. “While the bricks and mortar have all evolved, of course, the take-away we have the most pride in is our people or hosts. The main focus is taking care of our guests in new and unexpected ways.”

And not everybody fits.

“There’s a certain profile we look for as we think about new hire strategy,” says Moore, “people comfortable with that kind of interaction. The folks who are not, there’s tons of great backstage kind of work that fits better for them. And we really make sure that’s front and center as people are making applications for jobs.”

The new people who have appeared in my local Lowes Foods store recently seem to embody that spirit more readily than the old crew (although there are a few choice holdovers). Even the young workers who stock the shelves have sprouted an upbeat, helpful attitude. You find much the same at Publix, where employees also are owners.

Image © by Brian E. Faulkner

“Providing premier service and a pleasurable shopping experience is what we hang our hat on,” says Kimberly Reynolds, media and community relations manager in their Charlotte, N.C. division, who noted that as far back as 1930, their founder proclaimed that “we shall treat our customers like kings and queens.” Today, how the Publix brand promise plays out in the stores remains their “secret sauce,” as an associate in Fort Mill, S.C. proved to me recently by not only being above-and-beyond helpful concerning a product they did not carry but personable to boot. She personified founder George W. Jenkins' belief that "Publix will be a little better place — or not quite as good — because of you."

Max De Pree, in his seminal little book, “Leadership Is an Art”, talks about covenantal leadership, which I have seen at work in only a small handful of client organizations over the years – from small businesses to billion-dollar consumer products companies and their business units. The culture of a national apparel manufacturer/marketer I consulted to revolved around a passionate leader who created the future, invested the team in it and sponsored their success. But the company's culture proved tenuous. When the leader moved on (or in another case I recall, when corporate ownership changed), the cultural focus and inspired energy dissipated.

Lowes Foods, like Publix, appears to understand that in order to survive, qualities like “team” and “passion” and “commitment” can’t be pasted on. They have to be planted deep and lived out in the attitudes and actions of people who believe they are contributing to a larger cause. Only then can business culture become an enduring – rather than momentary – source of competitive advantage. It’s not something you can fake.

Publix hires people with “a servant’s” heart, which CEO Ed Crenshaw appears to epitomize. Lowes Foods hires people who understand the concept of “host” from the heart out, and their senior management team is quick to credit one another with the early success they’ve achieved in rebranding the chain and building a new culture. That suggests stability in an era when grocery shoppers will change stores on a dime just to get a good price.

Stability alone is no guarantor of success, of course, although stability based on a culture of believers with a can-do attitude can work wonders in attracting and keeping customers – and perhaps even help make a buck or two more than the competitor down the block.

Publix and Lowes Foods are destined to compete more directly in the near future as the Florida chain moves deeper into North Carolina. Customers are sure to respond positively to both stores’ people-powered presentations and reward them with increased business and greater loyalty.

TakeAway: People power can be a powerful source of competitive advantage. How does your culture stack up?

Content © by Brian E. Faulkner *FORTUNE and FORTUNE 100 Best Companies to Work For are registered trademarks of Time Inc.

Tags: Lowes Foods, Publix, cultural branding, Wegmans, Whole Foods Market, Nugget Markets, ALDI

About Brian Faulkner:

Brian Faulkner is a content writer and Key Message expert. He helps clients come up with words to set their businesses, brands and products apart and attract the customers they want most. His strategic insights, and the words that go with them, have made a significant, often immediate difference for client companies over many years. His "sweet spot" is smaller to moderate sized consumer products, retail, service and manufacturing companies that may have struggled to find just the right words to position their business, brands or products to competitive advantage:

> blogs to establish you as the thought leader / authority in your business category
> case stories that communicate your sales successes and invite prospect inquiry
> testimonials that showcase customer / client satisfaction in 1-2 short sentences
> positioning statements to guide business development & marketing
> landing page copy to set your business or brand apart in a compelling way
> tagline development to attract the interest of your most qualified prospects

Brian also is a three-time Emmy award-winning Public Television writer and narrator of over 100 segments for UNC-TV’s popular Our State magazine series, on the air since 2003.

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sample blog:

This is a sample blog for writer Brian E. Faulkner. It presents stories about brands that do (or don't) communicate competitive advantage effectively. Stories have been gleaned from the business press, personal experience and occasional interviews. New articles are added from time to time, and every so often there will be a post of general interest -- about things like success, passion, social trends, etc.

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Brian Faulkner is a writer and strategic communication consultant who helps business clients explain their competitive advantage in compelling and enduring ways.

He also is a five-time Emmy award winning Public Television writer & narrator for a highly-rated and well-loved magazine series.

Price! Price! Price!

People Power as a Competitive Advantage.

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