The Unattractive Customer Offer - Why Do It?

It's not rocket science, so why do so many retail companies disadvantage their existing customers with offers which don't make logical, emotional or possibly even financial sense? Here are two examples of offers which I have received during the past 10 days.

While visiting the beautiful city of York with my wife, we noticed a retail clothing store called White Stuff. They sell a very attractive range of mid-price, unique design clothing for men and women. What I enjoy about this store's approach to customer satisfaction and value is simple. They serve first - and earn second. How so?

Well, my wife and I first came across this store during a holiday in the Lake District. My wife wanted to purchase some clothes for her new job and she enjoyed browsing the unusual but very attractive designs. They had a sale on which was also a bonus for me! As my wife browsed, the store attendant gently offered to assist my wife if she would like. Politely declining the kind offer, my wife continued to browse. The attendant's attention smoothly changed focus from my wife....to me!

You're welcome to relax on the sofa if you wish sir', and a half-second later continued, 'or you can enjoy the range of gentlemen's clothing over here', gesturing towards where she wanted me to be. Buying!

I did notice a jumper which I would have liked to have bought, but the only size in store was too small for me. But, it wasn't a lost cause. She picked up the phone and called their store 8 miles down the road. Yes, the sister store did have a larger jumper in store and they would deliver it to this store for 9am the next morning. 'I'd be happy to arrange delivery for you sir....Shall I do that for you?'. How clever as well as professional! Why? Because this young lady had been so polite, gently helpful and discreet that I would have felt a little awkward rejecting her offer of help. Also, by accident or design, including the words 'Shall I do that FOR YOU'? added a very personal slant. It's the law of reciprocity in action. She was offering to be helpful to me, so I was compelled to return the favour.

Yes, we did buy and the whole experience was very positive. So, on to York. A different store location wise, but very similar in terms of offers. Unfortunately for me, there was no sale or discounts being advertised, but a genuinely friendly welcome from the female assistant was followed around 5 minutes later with an extended arm offering to hold the 3 shirts I had taken off the rack, while I continued to browse. The next offer? 'I'll put these in the changing room for you to try on when you've finished.' How cool! In a very professional, non-pushy sense, there was little opportunity of me leaving the store without first trying on the items of clothing she had 'kindly' held for me.

Another offer, and a very subtle one at that was this. 'I'll give you an over the shoulder bag which is free of charge'. Nice gesture. Not that I ever pay for carrier bags in any store. My local health food store wants to charge ten pence for a carrier bag (apparently to help the environment and save the planet). All along, there I was thinking that they were just generating additional income from themselves because they were jumping on the bandwagon of being good corporate citizens. This is the health store that following ringing over £30 of goods through their cash till stated to me 'And the carrier bag is ten pence...is this ok?' My polite and assertive response? 'Well, no actually it isn't, I won't be paying additional funds for the privilege of paying you good money for these goods'. Stunned silence followed until the gentleman advised me that it was 'Company Policy' to charge for bags. My polite and still assertive response? 'Thank you for letting me know that, as I stated earlier, I won't be paying YOUR COMPANY to make money off an environmental issue.' When I asked whether the proceeds generated from every bag sale - and every customer's blind compliance with their 'Company Policy' was donated to a charitable organisation his face changed...as did his manner. Guess who lost a customer?


Back to White Stuff. The offers they made were timely, beneficial for the customer, cost nothing but a few seconds of their time, generated rapport and an element of trust and were partnered with a high-quality product at a price I was willing to pay. How cool is that? Very cool I think!

Now let's look at the other side. Last night I spotted an advert in the newspaper from my local hairdressing salon. The offer is detailed below, word for word as published.

MANAGER SPECIAL - CUT & BLOW DRY
NEW CLIENTS ONLY £40
SAVING YOU £15

What's wrong with this offer? This SPECIAL offer? You guessed it! If you have never visited this salon and had your hair cut by the manager, you pay ONLY £40. Apparently, this SAVES YOU £15. Let's think about this. If you've never had your hair cut by the Manager previously, you benefit from a perceived saving of £15. But, if you are a regular client of the Manager, YOU STILL HAVE TO PAY FULL PRICE! How fair is that offer? In simple terms, if you're a long-standing client who has helped this company grow their business, or at the very least, remain in business, you are penalised. Why? Because you are a loyal, existing client.

The acquisition of new clients is absolutely essential to any company. I understand this fully. But actively penalising existing clients and customers is potentially commercial suicide. So, if you are a consumer, be careful what offers you accept from organisations. If you are a business, you too need to think carefully before publishing well-meaning but potentially dangerous offers.

Don't Get Too Excited Too Soon - You Could Lose Out

Negotiation is a wonderful thing. When two or more human beings agree to speak openly, honestly and with everyone's best interests in mind, it can lead to an abundance of authentic, collaborative problem-solving and genuinely win-win relationships can be developed.

Using a car purchase as an analogy, have a think about the following scenario:

Car dealers are having a really tough time and you decide that it's time to make the purchase for your new vehicle. But, as you already know that the car sales industry is on it's last legs, at least for the forseeable future, you decide that you are in a very powerful negotiating position. You think, 'He will want to sell me the car more than I want to buy it'. A rather innocent, yet possibly misguided view perhaps?

The brand new, shiny, sexy looking car will bring you adulation, a few 'wows' from colleagues and friends the first time they see you in it. But remember, you only ever get one 'wow' from anyone - and the cars value has already lost a few thousand pounds within seconds - not minutes of your purchase. Watch out, there are more shocks to come!

The car is priced at £20,000. It's the very car you had set your heart on. But you already know, the dealer doesn't really expect you to pay £20,000. They've gone up in order to come down in price. This is the negotiation about to commence.

But, with your insider knowledge of the car market, you decide to be really cheeky, even a little mischievous and offer over the telephone a paltry £14,000 or it's no deal. Your expectation is that the dealer will return with a counter offer which will reach somewhere in the region of splitting the deal 50/50. You expect it, the phone rings and it's the dealer.

As you are the lucky customer this week and they appreciate your business, they have decided to accept your offer of £14,000 for the car (which retails at £20,000 remember). Tell me, what are your first thoughts about their acceptance - without a fight?

1. I could have done better.
2. I should have started with a lower offer.
3. What's wrong with the car because they gave in too quickly/easily?
4. Ouch - how do I get a lower price without appearing too greedy?
5. Something else???

What you didn't know, and the dealer wasn't about to tell you was this. Their profit doesn't only come from the profit made on each car, it is also generated from the volume of cars sold each month. They don't even have to sell all of their stock at a profit, they can sell one or two at a loss or break-even. And because you didn't know this, your initial negotiating power has all but disappeared.

When there is a high level of trust in a relationship, both parties are often willing to negotiating a genuinely win-win deal. A deal where the seller can still make a profit and where the buyer can know or at least expect that their needs and wants will be taken care of as agreed. When there is low trust, it's everyone for themselves - self-serving, self-defeating attitudes, behaviour and communication. See my previous article about buying a car and relating the tactics back to the workplace.

The moral of this story for the workplace? Don't get excited too soon, remain calm and seek to understand as much of the detail as possible. Always keep a win-win mentality very much in mind, help set a context so that all parties can negotiate openly and honestly to achieve what needs to be achieved and to deliver what needs to be delivered - to the standards required. Get the best deal you can, but not at the expense of losing trust and causing toxic relationships.

The long-term challenges faced by nationals of Northern Ireland were eventually progressed because the concept of win-win, letting go of the past upset/anger and resentment and focusing on how to negotiate for the future benefit of its people won over blaming each other and living in the past. Remember, the good thing about the past is, it's over. The bad thing about the future is, many people just expect it to be something other than brilliant. It's that very thought that stops it from being as wonderful as it can be.

How are the levels of collaboration and trust in your team? What steps can you take to improve relationships so that when you do need to negotiate, the relationship is solid and based on mutual respect and integrity? Do share.