Online business will benefit from aggressive retail cross-selling
I am sick of shopping at retail stores (Putting aside mom-and-pop stores). I like going down the street to buy something, but I can’t buy a candy bar anymore without being offered a warranty, two magazine subscriptions, and a credit card. The cross-selling situation is getting to the point where I and others avoid shopping at retail locations. I avoid going into a number of stores simply because I don’t want to deal with being offered a bunch of crap that I don’t need. I have no problem saying no, but i just don’t want to have to. I bought a laptop from Circuit City, a while ago, and I had to literally walk out of the store for the salesman to stop adding the warranty to the bill. I’ve known more than ten people who’ve been talked into several hundred dollar warranties because they were pressured into buying them. They were hardly any improvement on the manufacturer’s warranty. In the past few months I have been observing other people’s reactions to this retail mess, and I’m certainly not the only one who is sick of it.
Lets compare up-selling online and in retail.
Salesman: Would you like to purchase an extended warranty with your laptop. We have an on-site warranty that covers an accidental damage for an additional $200. A serviceman will come to your house and fix your computer.
Me: No thank you. I don’t need a warranty
Salesman: Even if you drop your computer and it gets destroyed, or you spill something on it, it’s covered.
Me: No that’s fine, I don’t want one.
Salesman: It even covers upgrades. If you need to upgrade your RAM or hard drive, it will need to be done in a static-free clean room, and this warranty covers that.
Me: Just the computer, no warranty. (thinking: this guy is full of S–t)
Salesman: OK, so you total comes out to $1096.78, and I added the one year warranty, instead of the two year.
Me: You’ve got to be kidding me, I’ll just go somewhere else.
I don’t think that this is an unfamiliar scenario that people encounter at many of these mega-retail stores. It seems like every publicly traded retail corporation has at least 15 different offers, warranties, bells and whistles, plus a charge card and three of four co-branded credit cards, and we all absolutely need them just to survive.
How online businesses benefit:
Online businesses are going to get the fallout from people getting sick of being cross-sold, and up-sold on everything. Unfortunately many of those businesses that aggressively push the extras are the same websites where their customer will end up in the end. What I love about the internet, is that the mega-retail stores, rarely have the best deals and best service when it comes to ecommerce. The internet is still an open marketplace for almost every industry, while the retail environment is all but closed for many business types.
Obviously the convenience that online businesses offer is a selling point in itself. In the retail world, shoppers don’t have the ability to click a link to instantly get out of a store. They have to sit through some lecture about a warranty or accessory, and then do it again at the next store they go to. Online business is still growing a lot, and retailers have definitely taken interest in the online competition. Manufacturers have the ability to limit prices which stands to benefit strong brands a lot.
Just as traditional media marketing is failing, I think that traditional retail will also start to fail, and those super-retailers are going to be the ones dragging the whole system down.
My advice: Whether you sell online or in retail, be in business for your customers and not for the money. It’s the only way to stand apart and stay competitive!
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