Each year, the holiday shopping season ignites consumer spending, prompting people to spend more than they do any other time of the year. Competition heats up for brick-and-mortar and online retailers, who often spend months strategizing the best ways to attract customers. In some cases, a robust holiday season could provide just enough end-of-year revenue to move successfully into the next year.
As showrooming and webrooming continue to put pressure on retailers to offer the lowest prices, businesses are challenged to keep up with what competitors are doing. During the already busy months of November and December, it can be tough for a busy retailer to constantly check the price of every product to make sure a competitor isn’t offering it for less. As a result, retailers are beginning to see the value of price matching.
Luring Customers In with Price Matching
According to the National Retail Federation, 44 percent of consumers will do some or all of their shopping in stores. Despite this statistic, brick-and-mortar retailers face a disadvantage, thanks to the prevalence of smartphones.
Retailers have complained that their stores serve more as a showcase for products, with customers showing up to see items in person before purchasing them from online retailers. To combat this trend, more retailers than ever have started to offer price-match guarantees for the Christmas season. However, because Amazon frequently reduces prices to a level that requires it to operate at a loss, smaller businesses may find it difficult to do the same.
How It Hurts
Small businesses often can’t afford to accept a loss on one item, only to make it up on other items in the store. Yes, offering to meet or beat any competitor’s price can draw customers in, but if small business owners can’t make up that loss in the other items that customers buy, they’ll soon find themselves out of business.
Instead of price matching, some smaller retailers may find that offering perks like free gifts with each purchase can draw people in without giving away the store.
Value Over Price
In addition to offering immediate access to products, small businesses can provide a level of service that a customer doesn’t normally get from national chain retailers, whether online or in-store.
A small, locally owned business can use this to its advantage by offering a personalized customer service experience that will keep smartphones in pockets while customers are shopping in the store. Additionally, offering one-of-a-kind items that can’t be found online will completely eliminate showrooming without having to lower prices.
As price matching causes competition to heat up this holiday season, local retailers can still compete. While price match guarantees are a great way to combat showrooming, smaller businesses can still maintain their profits by providing a level of personalized service that draws customers in and prompts them to spend money.
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