By Jordan Malik, MBA/MS & Award-Winning Amazon Pro Merchant & eBay Top Seller


Deals that Suck, Part II

NOTE: This blog has moved to:

Hi, online sellers.

Last December I wrote 'Deals that Suck', about how major retailers are consistently underwhelming consumers with also-ran sales and specials that really provide little or no value to us.

I think Sears topped the cake, though.

A few days ago I was in Sears and signed up for their Rewards program, without paying much attention to the fine print. I got my flashy new Sears Rewards card to slip on my keychain. I was cool.

Yesterday I went back into Sears and bought my wife a $200 vacuum, an extended warranty, and some vacuum bags. It totaled up to about $280.

I proudly gave the clerk my Sears Rewards card and after she rung everything up, she told me I received about twenty-eight HUNDRED points - or 10 points for every dollar I spent. Wow that must be worth something then, huh? Total DOLLAR Value? $3.01.

Let me rephrase that: My reward for a $260 purchase was $3.01, or a smidge over 1% of my total purchase price. 


I'd have liked to be a fly on the wall at the Sears Executive Meeting when they dreamed up this one:

     Clueless Sears Executive #1: "BJs and Target and Wal-mart are eating up our market share."

     Clueless Sears Executive #2: "What can we do to get buyers in our stores more often?"

    Clueless Sears Executive #3: "I've got an idea: Give them a penny in Sears Rewards for every dollar they spend, but call the penny '10 points' to give them the illusion that they're getting a lot back."

     Clueless Sears Executive #4: "Wow. Are our customers really that dumb?"

You probably already know Sears is a wet, limping laggard in the retail world. They need a damn near miracle if they're going to survive the long haul.

So what does Sears' leadership do? They flip customers the bird with truly insulting incentives like the "rewards" program.

The message for us online sellers? Outlive Sears. Don't be like them. You don't have to give your customers margin-cutting discounts. Just do things that make them really smile, and mean it:

-Throw in something special that doesn't cost much. If a toy takes 4AA batteries, send them some. You don't have to buy duracell, but go to the $1 store and get the generics.

-Provide a generous return policy, like 60 days or even a full year (or, like one of my products, a LIFETIME replacement guarantee. IF you're selling a quality item, you rarely ever have to worry about a return, trust me. You can charge a bigger price (=bigger profit for you) than your competition by offering a generous return policy.

-Offer free shipping for all/most of your products. Increase the price of your item if you have to. If you don't offer free shipping, make it cheap enough so they don't balk.

But don't - please don't - give incentives that seem clever to you but clearly have no value to your buyer. You're not Sears, a big dinosaur that might take many mishaps and stumbles to crumble. You're probably a mom-and-pop shop, or a 1-person operation, like me.

Overwhelm your customers with goodness, and keep 'em coming back.

Do Great Stuff!
-J.B. Malik


Lindy Belk said...

Your post today made me smile and shake my head in agreement. I have a similar story. I was at Big Lots yesterday and I signed up for their rewards program too. I was told for every $20 I spent, I would get 1 point on my card. Once I earned 10 points, I would get a 20% off coupon to use at a later date. I spent $170 so I thought I was well on my way to earning the 20% off coupon. However, when I looked at the bottom of my receipt, I noticed I only had 1 point. It seems you can only earn 1 point a day, regardless of how much you spend. I was a bit heartbroken. I'm not going to stop shopping there, but I'm not going to worry so much about if I give them my rewards card or not.

peabo11 said...

Great post JB, always look foward to your newsletter,please keep them coming!

thewahakid said...

If I am not mistaken, Sears and a lot of large coorporations recruit ex-politicians for board of directors positions....thus the "10 points" idea comes to being.

Sandy said...

There's a local grocer that lags behind all the others, and this latest "promotion" may be one of the reasons. You spend $40 in one trip, you get a $1 Reward Buck to use on your next trip...spend $80, you get $2...etc. Oh, and there's no limit to what you can "get back." Their motto is something to the effect of "the more you spend, the more you save." I say...forget it!!!

BlondiesBoutique said...

Great post! Love it!