Several years ago I heard consumer reporter Clark Howard say, “Someone will always find a way to do what you do for less. But people will pay MORE for the experience of doing business with you.”
Consider Starbucks coffee. Is it overpriced? Many people think so, but they have developed a strong niche experience that keeps them at or near the top in coffee shop retailers. Many people just can’t do life without a stop at the local Starbucks each day. Customers enjoy being seen with a Starbucks “Venti” cup in their hands.
Did you see the movie, “You’ve Got Mail?” Behind the love story starring Meg Ryan and Tom Hanks is a big box bookstore putting a small community store out of business. Barnes and Noble was the go-to book store just ten years ago. Customers flocked in their retail outlets to shop, sip coffee, read and buy. They survived the early demise of their prime competitor Borders. But they, just like Borders, didn’t see the digital age fast enough.
Amazon’s Kindle has been a game-changer in the publishing business. The sales of Ebooks grow every year. B&N got into the e-book tool too late with their Nook reader. Amazon continues to improve the Kindle, while Barnes and Noble lags behind in both product development and sales.
The vultures are gathering today for Future Shop (Canada), Sears/Kmart, Abrcrombie & Fitch, Tesco, Aeropostale and Toys R’ Us. They are close to declaring final bankruptcy because they thought they were recession proof. Macy’s, JC Penney, Office Depot, Staples, Walgreens and Body Central/Body Shop announced the closure of more than 200 stores each in the next year.
Remember, someone will always find a way to deliver what you do in a cheaper way. They are planning it now while you read this. Your advantage is telling yourself, “It’s not about price; it’s about value.” Deliver value like no one else and your business will be unique… like no one else.
Easy Action Steps: Google some company that has declared bankruptcy recently. Find out why. What trends or movements did they miss? How were they mismanaged by bad decisions? What actions did they take to stave off their death? Who did they turn a deaf ear that was trying to warn them about the changes they had to make? What would you do to prevent their demise?