Mobile internet access further blurring lines between channel-specific pricing
The following excerpt from ReadWriteWeb shows a fantastic trend happening in retail environments today whereby consumers have instant access to pricing information on products via their mobile phone:
Stores Clueless About Mobile Barcode Scanning Applications?
With the rise of app-laden smartphones like the iPhone and Google’s Android OS, now on T-Mobile’s G1, many penny-pinching shoppers have downloaded barcode scanning applications onto their mobile devices. These apps allow consumers to compare the prices of merchandise on a store’s shelf to competing stores in the area just by taking pictures with their smartphone’s camera. The prices are instantly retrieved and displayed on the mobile phone so consumers can know before they buy if they’re getting a good deal.
via Stores Clueless About Mobile Barcode Scanning Applications? – ReadWriteWeb .
Mobile barcode scanning is like PriceGrabber; it puts the focus on service and reasonable pricing from retailers, not only lowest possible price
The reason why I like mobile barcode scanning is because, as a consumer, this will put pressure on retailers to be competitively priced and (more importantly) focused on servicing the customer. If it mobile barcode scanning grows widespread, this will ultimately force retail channels to align with pricing in online channels.
Essentially, mobile barcode scanning acts as your own personal PriceGrabber.com. With PriceGrabber, you enter a product name and see competitive retailers, retailer rankings, and pricing:
With phones like the iPhones which blur the lines between internet device and mobile phone and have a built-in camera, barcode scanning becomes easy — snap a photo of the barcode, an iPhone application reads it, and then performs a web search for competitive pricing and availability much like PriceGrabber.
It’s difficult to find significant price savings across products and retailers on PriceGrabber — because the playing field has been leveled for retailers in the price game and forces them to focus on service. Price your products too high, and the masses will not buy from you. Price them low enough, well, you had better be able to support the service on the small profit margins you’ll be making.
If barcode scanning doesn’t enforce better service, then it will demand unique product assortments from suppliers at the retail level
A world where retailers all sell identical product assortments for virtually the same price is going to force retailers to differentiate in other ways. Sometimes this means the retailer will go private label with certain products. Or, retailers will demand a unique product selection from their supplier within a product category. Other times, retailers will negotiate exclusivity on products for a period of time. Larger retailers will do all three to be well diversified.
This burden/strain will ultimately land on the manufacturer’s/supplier’s shoulders; Brand names will win in this environment
Bar code scanning and the PriceGrabber’s of the world put added burden/strain on manufacturers/suppliers. The manufacturers will be forced to be creative in their go-to-market strategies as they launch new products across various retailers and channels. Well-recognized brands won’t fall victim (as much) to the bundling requirements, product assortment strategies, and channel-specific pricing.
Apple, for example, is represented identically across channels — with pricing being within single digits of each other between retailers. A barcode scan on an iPhone will show similar pricing across all channels of business and all retailers — thereby putting the emphasis back on the retailer to provide good service and support.
Consumers will win this battle
As much as retailers want to control the environment, at the end of the day, pricing shopping is what people will do, whether or not barcode scanning is banned. Ultimately, consumers will win this battle, and that’s a good thing.
No comments yet, be the first.