In my previous article ‘The rise of the tech-savvy employee’, I looked at what impact multichannel retail is having on shop floor employees, including the challenges that they face when dealing with new technologies, whether customer service has changed as a result, and how their role is expected to develop in the future. This month, I would like to discuss price comparison – our need to hunt for the best bargain, those companies that cater to those needs, and the impact it has on retail in general.
It’s probably safe to assume we are naturally predisposed to look out for a good deal – even when financially comfortable the satisfaction of returning home with a bargain in hand is hard to beat. We get great pleasure in regaling friends in tales of our shopping prowess. This desire to track down the lowest price possible has been further accelerated by the current economic climate – shoppers who have been forced to tighten their belts in recent years compares prices not just for fun, but also because of necessity.
This growing trend in shopping behaviour has been helped significantly by the rapidly evolving consumer technology landscape – we don’t need to walk from shop to shop, we can do it from the comfort of our own home. As a result of the explosion of smartphones and tablet devices, we can even compare prices while we’re on the move, sat on the bus or eating our lunch in a cafe.
We also have dedicated websites to help us hunt out the best bargain. In fact, around 10 million people use price comparison websites each year in the UK. They’re quick, convenient, and most importantly, offer great deals on a whole host of products, from fashion and electronic goods, to financial services and car insurance. By simply entering a few details, comparison sites provide a wealth of information, listing products from different retailers or providers depending on your needs. The comparison shopping facilitated by sites such as Kelkoo.co.uk, Pricerunner.co.uk, StyleCompare.co.uk, and Comparethemarket.com, offers obvious benefits to consumers who can find the best deal on the product most ideally suited to their needs.
Mysupermarket.com has taken the process one step further by allowing users to compare the price of their virtual or physical in-store shopping basket with a number of other major retailers, including Boots, Superdrug, Majestic, Sainsbury’s and Asda. This is a great service that ensures customers can get the best price for their shopping. However, as consumers can do this, retailers should embrace the capability and guarantee to meet the lowest basket price there and then in store; not only will it secure the deal and keep the market share, but it will also avoid the race to the bottom of line-by-line product commoditisation.
So comparison sites can clearly benefit both the shopper and the retailer. But this desire to compare everything we buy might not be completely positive. A study by Dunn, Gilbert and Wilson, published last year in the Journal of Consumer Psychology, titled: “If money doesn’t make you happy, then you probably aren’t spending it right”, suggests that comparison shopping may sometimes come at a cost.
By altering the psychological context in which purchasing decisions are made, “comparison shopping may distract consumers from attributes of a product that will be important for their happiness, focussing their attention instead on attributes that distinguish the available options”. In other words, the process of comparison shopping may focus consumers’ attention on irrelevant attributes of a product to get the ‘best deal’, instead of a product that is best suited to their needs.
The authors also argue that the comparisons made when shopping are not the same comparisons made when consuming what was shopped for. One of the dangers of comparison shopping is that the options we don’t choose – so we can get the best deal – become l