Cocaine of Marketing

Imagine going to the doctor with no real ailments. You want to feel better. So he advises to eat healthier and get some exercise. You want to feel better now. So you ask for a prescription of cocaine.

Ridiculous right?

Cocaine solves a short term need but its long term negative effects far outweigh its benefits. Cocaine is not the answer. The doctor is right: proper diet and exercise is the key.

Price discounting works the same way as cocaine. It's never the real answer.

It works wonderfully well.
Put something on sale and customers buy it.
Sales spike.

Business thrives...or so it seems.

Effectiveness of discounting goes down each and every time you snort it. The initial high is never as good as that first time. With proper training, customers won't even enter your store unless there's a discount.

Business erodes.
Profits sink.
Sickness prevails.

The retail industry has become heavily addicted to discounting.

In the battlefield of retail, businesses look for reasonable excuses to put another sale on the window. The traditional reasons to buy for Valentines Day, Easter, Summer break, Back to School, and Christmas are too far apart. Retail looks for other reasons to keep customers coming within the two months of each occasion.

Those reasons feed the addiction. The addiction to looking for a sale.

Retail started advertising "Black Friday" deals about four years ago in Canada.

It doesn't make sense to me.  Traditionally, Black Friday is the unofficial start to the Christmas shopping season in the United States. It follows American Thanksgiving, as the last Friday of November.

Canadian Thanksgiving is in October. Black Friday is just another Friday. The unofficial start of Christmas shopping in Canada follows Remembrance Day.

Black Friday doesn't mean anything to Canadians except deep discounts at retailers.

It is normal for consumers to look for a deal.

Until someone gives us a better deal.

When consumers look for deals, there is no loyalty to brands, products or businesses. The sale becomes transactional.

No wonder retail stores close so frequently.
Their competitive advantage is based on price.
And price is always the easiest and fastest thing to copy.

In the words of Roy Williams, "Most retailers are twitchy little weasels".

My advice to retailers:
Don't be a twitchy little weasel.
Don't be lured in by the powder.
It won't make you feel better long term.
It will kill you.

Come up with a better messaging. Give your customers a reason to love you and only choose you when it's time to buy. Look for and engage the relational customer.

They will pay you happily for your product and won't need a discount to encourage them to buy.
Engaged customers, higher sales, stronger profit margins.

Let your coke laced neighbours die. Don't be one of them.

If you want don't want to be a business addicted to discounting, you can reach me at ricknicholson@wizardofads.com to discuss how we can help you.