Retailers Further Complicate In-Store Pricing | Koeppel Direct

Retailers Further Complicate In-Store Pricing

retailer in-store pricing

“We don’t operate in a vacuum,” Abercrombie & Fitch’s Executive Chairman Arthur Martinez said recently when asked about retail pricing in the eCommerce Age.

This seems to be the consensus of retailers everywhere, given that the market shares of brick-and-mortar companies continue to shrink in response to the easy access shoppers everywhere have to prices on similar items across the globe. For customers who are willing to wait a few days, buying online can make a lot more sense, especially if they’re saving money even with shipping included in the price tag.

Retailers Fire Back Against eCommerce

Confusing membership plans, on-going sales and multiple tier price points designed to pressure customers to pay as much as possible for each item are becoming things of the past. Companies like GNC, Bed Bath & Beyond and Restoration Hardware are slowly realizing customers would rather simply check their smartphones for the best deal they can get.

Instead of fighting over these in-store goods, shoppers look online for the best price and sometimes even order these same goods from eCommerce shops while standing in retail locations. Restoration Hardware, for example, has seen a six percent drop in same-store sales since last quarter; Bed, Bath and Beyond’s quarterly profit dropped 29 percent in the last quarter.

GNC has already taken steps to stay competitive in the new world of retail by closing stores in order to reprice every item in the entire chain. This move will take products that sometimes have as many as four different prices to a system where what you see is what you get and where if a new customer compares the prices in-store to an eTailer, they don’t accidentally overlook special club discounts, deals and regular sales.

Prices post-closure will be lower for over half the products in the store, GNC’s Chief Marketing Officer Jeff Hennion told The Wall Street Journal.

The Rise of the Loyalty Card

Even though GNC is going for a simple “what you see is what you get” pricing system, others like Restoration Hardware are considering a program similar to Amazon’s Prime. Restoration Hardware is proposing a $100 loyalty card that grants holders a 25 percent discount. Bed Bath & Beyond’s $29 plan (still in testing) gives customers 20 percent off all purchases, plus free shipping from the website.

Although this policy seems like it would be good for some shoppers, it’s a curious response to an increasingly transparent eCommerce threat. When customers can purchase items online without coupons, memberships or other hassles for less, why would they bother with traditional retailers?


Your browser is out of date. It has security vulnerabilities and may not display all features on this site and other sites.

Please update your browser using one of modern browsers (Google Chrome, Opera, Firefox, IE 10).