Sign & Digital Graphics

October '19

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28 • October 2019 • S I G N & D I G I T A L G R A P H I C S Think Twice Before Cutting Prices Resist the temptation if sales are sluggish Vince DiCecco is a business training and development consultant and owner of the Acworth, Georgia-based business, Your Personal Business Trainer, Inc. He has been sculpting his sales, marketing and training techniques since 1979, and he has shared innovative and practical ideas on business management excellence for two Fortune 200 companies, the U.S. Coast Guard, and in seminars at many sign and digital graphics trade shows. Since 2003, YPBT has been serving small- to mid-sized companies in their efforts to strive for sustained growth and market dominance. Contact him via email at vince@ypbt.com or visit his com- pany website, www.ypbt.com. W hat do the following once brand-name retailers have in common? Sports Authority, Toys "R" Us, Circuit City, Sharper Image, HH Gregg, A&P Supermarkets, and Howard Johnson's Restaurants. If you guessed they all went bankrupt and are no longer in business after once dominating their respec- tive market segments, you are correct. So, what went wrong? A good portion of the blame for each of these companies can be placed on their decision to try to compete by offering bargain- basement prices on some of its best-selling items and trying to build customer relationships through across-the-board price cutting. Were they forced to offer matching prices for comparable products as their chief competitors due to fear of losing market share? Hardly. They each rose to the top of their industries with quality products, friendly and reliable service, warehouses full B Y V I N C E D I C E C C O Make it Your Business ARCHITECTURAL AND ENVIRONMENTAL RUNNING THE BUSINESS of available inventory and/or timely delivery, and hundreds of convenient locations. Yet, in the face of various adverse market conditions, they made the conscious decision to compete pri- marily on low prices. Now, consider this company backgrounder, dated April 2004, taken from the once-powerful computer maker Gateway Inc.: "Gateway, since its earliest days, has pioneered numerous industry trends and practices. It was the first PC company to offer systems with color monitors as the standard, the first to offer a standard three-year warranty and the first to commer- cially explore the convergence of the PC and television. It was one of the nation's early "bricks and clicks" retailers, and it was among the first direct retailers to sell its own branded consumer electronics... such as thin plasma TVs, digital cameras, camcord- ers and other networking products." It was these differences that set Gateway apart from the others and led them to receive nearly 130 industry awards and honors in 2004. So, why did Gateway head down the road to extinction instead of distinction? It was because it thought it had to cut prices to be competitive. Capitalize on Core Competencies Gateway's stated corporate vision was to "offer products directly to customers, providing them with the best value for money, and delivering unparalleled service and support." Nowhere in its vision statement appeared the word "discounter" because it didn't become successful on the fact that it had the cheapest products. In fact, Gateway had built its reputation on innovation and ground-breaking customer care. That was Your company should consistently distinguish itself from the competition in the arena that means the most to your targeted clients.

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