EXPLAINING PRICING TO CUSTOMERS
When there's a discrepancy between online and in-store
by Service Dealer Editor, Steve Gibbs
 
Steve Gibbs

I spoke to one of our dealer readers this week, who told me how they had to recently engage with a negative online review from a customer.

 

The dealer explained how these critical comments, posted to a review site, stemmed from a difference in pricing on machinery seen online compared to in-store. What was interesting though, was that in this instance the dealer wasn't having to contend with the disgruntled customer finding an online bandit demonstrating a race to the bottom on pricing (although that, of course, is an on-going problem).

 

No, this particular complaint arose from the dealer's own website listing certain items slightly cheaper than what they were retailing for in their showroom.

 

The customer had purchased several items over the counter, then for whatever reason gone home and looked them up on the dealer's site - discovering they could have saved a few pounds if they'd placed an internet order for the same tools. This discrepancy, they felt, was not right - and thus posted a stinking review of the business for all to see.

 

Now, the dealer I spoke to this week was interested to hear fellow dealers thoughts on this. Firstly, is this something that you do at your dealership - charge a lower price for some items online than what you do in your bricks and mortar store? Then, if you do, how do you explain or justify this to any customer who questions your practice?

 

It seems to me as an observer, that it's understandable why the customer may have felt 'ripped off' to some degree - but, in the next breath, how there are genuine, comprehendible reasons that a dealer could use to clarify this divergence in pricing.

 

I realise I'm not telling any of our dealer readers something they don't inherently know here, but surely the principal reason for a higher price in-store than online would be the expert, one-to-one, great personal customer service given in the showroom? Your specialist advice, tailored specifically to the customer's needs, comes at a premium. This will involve finding about their circumstances, demo-ing equipment, PDI-ing, setting up and testing kit - plus on-going aftersales support.

 

And these are not simply nice extras, they have real value. Customers are paying for peace of mind, and the reassurance that they’re getting the right tool for the job, properly set up and supported. Online, they may be saving money, but they’re also taking on more risk and responsibility.

 

There are also, of course, the overheads involved in running a physical retail space. Rent, rates, insurance, trained staff, etc, all contribute to your costs in maintaining a showroom and workshop. One suspects a customer may forget about these when simply looking at the bottom line.

 

I suppose the next step, is then how to deal with a negative online comment and how to convey concepts such as these to the upset individual? The dealer I spoke to this week, said they quickly and politely responded publicly to the complainant, using this kind of reasoning.

 

When we've had online experts speak at the Service Dealer Conference in the past, they have said that this is the best policy when dealing with negative feedback. They have said that dealers should be seen to address anything swiftly, in public, in a calm and professional manner. Then frame your response as a clarification rather than some sort of excuse. You are helping them, and other future customers, understand the fuller picture.

 

But what do you, our dealer readers, think about this situation? Do you charge more for the same product in your showroom than you do online? And if you do, how do you convey your reasoning to customers?

 

Please share your comments or below, or if you'd rather remain anonymous, please feel free to drop me a line in confidence.

 

Thanks in advance for your feedback.

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EXPLAINING PRICING TO CUSTOMERS
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