- Retail Marketing is about delivering a proposition (supply side) that meets a customers needs (demand side).
- By now you understand that the proposition is more than product, but the whole ‘package’ wrapped up in price & presentation.
- We also know that ‘product’ is not the ‘steak’ but the ‘sizzle’.
That is the supply side taken care of, now we need to look at the ‘demand side: what do customers want?
In previous post we stressed that people are strongly influenced by avoiding ‘pain’ – rather than the benefit of owning something.
For instance, in my business, one of the divisions offer nationally accredited training. (I.e. certificates as offered byTAFE, funded by the Government.) However, most retailers don't find that an 'attractive offer, even though it is effectively free! ("It is a hassle, it impacts on operations, the staff will leave soon anyway - why bother" - etc.)
We therefore developed the package in such a way that the whole program is geared towards making staff more productive.
We address the 'pain' in the retailer's world of having to pay for people who are unproductive and just hanging around when they could be adding value.)
Another example: When a customer reacts to “last few remaining” or “limited time”, they are strongly motivated by the anticipated regret (= pain), and less so by owning the soon to be extinct ‘offer’. (Although they must have some rationalisation for making the purpose of course.)
At a macro level the ‘need’ is the need to ‘survive’. Survival instinct is the strongest motivator: and your job is to find out how it manifests in your industry/ category. (Physical survival = eat, drink, sex etc. But also survival of ‘self image’, survival of your ‘status’ in the eyes of others and ‘social’ survival etc.)
- A need is fundamental and generic. (E.g. Food. Think Maslow’s hierarchy of needs)
- A want is that same need shaped by culture (E.g. not just food, but a hamburger.)
- Market demand = wants + money available to satisfy the want.
So, how do you convince the customer that your retail proposition is the best way to satisfy their wants?
The governing principle that applies to whatever you do in the act of persuasion and selling is ensuring that you demonstrate how your proposition reduces/eliminates their pain. This is known as Omega Strategies. (This is the new way of selling.)
This approach is supported by Alpha strategies – which provide information on features, advantages and benefits that give people the opportunity to (post-) rationalise their initial ‘decision’. (This is the 'old' way of selling.)