I remember many afternoons caught up in conversation with AJ Richard the Son in P.C.Richard & Son the iconic New York Retailer of Appliances and Electronics. We would talk about advertising, why people buy, and building customers not sales, AJ would always remind me and grind in his belief that every day when the doors to our stores opened “Everything Was on Sale!” if it was advertised or not! He was also cautious to remind me that there were those that were ready to buy and a whole lot more that weren’t and we had to cultivate the forest and harvest the needs of our in store customers. Advertising had to be used carefully always adjusting for the winds and the tides in a timely manner, this was important to the your customer as well as your competition.
Over my 16 years with AJ and five decades in advertising I have learned an awful lot about the ebbs and flow of the marketplace; the benefits of promotional tools and the serious consequences of developing price driven not customer driven events. That is what inspired me to write this article.
We are just a few days away from Amazon Days, I have written about this event since its birth. It seems to me that the effects of Amazon on E-Commerce side and Wal-Mart on the traditional side have reshaped many buying patterns. First major effect was the predatory practices of Wal-Mart establishing a lowest price paradigm. This led to shifting shoppers and buyers away from downtown and malls and then in many cases moving or expanding those locations to to new locations drawing those customers totally away from their old patterns. Just walk down Main Streets all over America they are either loaded with vacancies or transitioning to restaurant or boutique rows. Down town was the place to shop then came the impact of the mall years, now it’s Walmart and discount clubs draining what remains. while this was going on E-commerce was evolving, in 1969 Compu serve appeared on the internet, it took till 1995 for Amazon to appear, 1998 for the Paypal Shopping Cart, 2003 for Google Search, and 2007 for FaceBook Advertising to evolve. We are now in our 4th year of “Amazon Daze”. Amazon Days has expanded to a 36 hour event. Very much in the same way WalMart decimated downtown; Amazon is dominating and capturing e-shoppers. Amazon during its annual event controls more than 70% of all business and they can easily deliver them. While those two battle for supremacy something else is going on too!
July can be a challenging month for many retailers and very often “Christmas in July Sales Came to their rescue.. Those were also times when a customer based market thrived and customer service and salesmanship were looked at as a requirement for success. Walmart brought a price first atmosphere to the marketplace and it has taken root. Amazon has captured the internet, delivery, and price first reason to buy. Traditional advertising is wanining; people spend more and more time on devices and less on television, many if not most don’t read newspapers or turn on a radio. We always as advertisers were careful not to over advertise, however much of the market approach is through Sales. Many companies advertise themselves into self dug graves using price as the only reason to buy. Is there a void developing in anticipation of Amazon Days? Is there a void left behind in the wake of sales created on price based purchases that take customers out of the market? Has Amazon created an event that is so disruptive to the marketplace that it is eroding sales across all channels? Will they use this type event category by category to dominate other product categories?
Consumerism has been around for centuries, the “Golden Age of Consumerism” was 1950-1960 along with the Mall Era this was long before; Price Clubs, Home Shopping Networks, Compuserve, PayPal, Walmart and Amazon. Through all these years there has always been only two reasons people buy things “Need and Want“; how those needs and wants are satisfied has changed to meet the requirements of buyers and sellers. Will unique regional retailers and their products survive or be stifled by Mega Marketers Selling “Lowest Priced Everything’s” and “One Size Fits All Somethings”? to “Low Price Everyone’s”
Just my thoughts, would love to hear yours… alan b. meschkow
