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My wife will happily tell anyone that I am hopeless when it comes to listening to lyrics in songs.
I will happily sing the wrong lyrics to a song for years until eventually she'll have enough and say 'You realise they aren't the words don't you?'
So it was with some misgivings that, upon hearing some lyrics in a song this weekend that really struck home to me that my first port of call was to my wife to clarify the actual words.
Fortunately for once I was right, not that she'd ever actually tell me I was right about something!
The words that struck home to me were:
"If something's too cheap, then someone is paying somewhere" by Canadian band The Tragically Hip.
What is it that struck me about these words?
Well funnily enough it brought home very clearly the current issue with consumers turning to the internet and buying in goods from overseas.
'If somethings too cheap"
Well we all know that there is a saving to be had on pretty much any retail category for consumers to take advantage of.
But at what cost? Who is the 'someone paying somewhere'?
Well sadly, it will be them, the consumer themselves who may end up paying the steepest price.
Let's assume the dollar stays high, Government that doesn't change the GST threshold and consumers continue their surging online spending. Sadly you don't need to be Nostradamus to predict these things will continue in the near future at least.
There is only one end outcome of this trend.
Less retail stores. Period.
Shopping centres are rapidly changing their mix with more and more services occupying space and less and less retail stores.
Who would have thought 5 years ago that people would head to a mall for a massage, a latte and a visit to the Doctor rather than to buy a new pair of shoes or a book or two!
With retail employing around 11% of the total workforce in Australia, and with predictions of 2-3% of them losing their jobs over the next few years then that will be 2-3% of people who will have less money to be spending in other areas of the economy.
And it is those 'other areas' where our online consumers predominately work...for now!
What will happen when spending on their products and services start to diminish? Where will they end up?
I was discussing this with a customer at one of my Workshops the other day and she said 'isn't it just like back 100 years ago when all the factory workers lost their jobs when automation came in? We evolved and developed from there!"
She felt she had a valid point (and guess where she buys her gear?) - until I asked her "Would you have liked to have to live and survive through that transition period? Remember the Great Depression?"
This sure gave her pause for thought.
So if somethings too cheap then someone will certainly be paying somewhere.
So what do we do?
If the Government wont help business then we need to do what we can to help change the behaviour of the consumer.
Gerry Harvey stumbled badly last year when his ill worded statements regarding GST drew massive criticism from the general public.
What we need is to look holistically at the problem and ensure whenever we are talking with people about pricing that we go beyond the 'it's impacting me" argument to the 'it will come back to impact you'.
I have this discussion at nearly every Workshop I run (2 a week).
The only way to start to change behaviour is one person at a time.
Talk to your staff, work together on strategies to ensure the conversation they are having with your customers is working towards behavioral change rather than the 'Harvey' School of judgement.
If we all start working on one customer at a time then we have a real chance of creating change.
That's enough from me, I'm off to ask my wife why Hendrix keeps wanting to 'kiss this guy'!
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