Is Bargaining Acceptable in eCommerce?
A guest post by Branislav Srdanovic.
How many times have you entered the store, picked and tried a perfect piece of clothing, got shocked by the incredibly high price and left? If you like the item so much, you might decide to dive into your kids’ college fund or skip dinner for the next few months. That plan sounds like a great idea: losing a few dollars while trying to avoid personal bankruptcy!
The product you want so badly can be easily purchased by your boss, wealthy business people, or even a sixteen-year-old YouTube millionaire. The consumer society is unfair! It is an eternal price struggle between merchants, who want to earn more, and consumers who search for the best value for the money they are spending.
Let’s now look at the other side of the coin. Someone’s business and life depend on the few extra dollars you spend while shopping. I am from Serbia. In my country, unsuccessful retailers often comfort themselves by saying, that, ‘there is a buyer for every product.’ Yeah right! Tell that to the people who launched New Coke, Microsoft Bob, and RJ Reynolds smokeless cigarettes. Waiting for a perfect buyer to come is not the right way to run a retail business.
Fortunately, digital technologies have made merchants’ lives easier. Today, they use various forms of digital marketing tech to target consumers with the appropriate income. You know, the filthy rich people, or the less-fortunate who are looking for bargain deals.
But is reaching the right consumers with fancy algorithms the only way retailers can solve the price riddle? Of course not! If you want to change the world, start with yourself. Instead of searching for a perfect customer, try experimenting with various pricing models, make your products more attractive and your customers more loyal.
From an Online Store to a Dusty Bazaar
The retail industry has come a long way, from people selling surplus goods on dusty fairs and markets to consumers ordering items with a few clicks on their smartphone display. Although the technological advance in this niche is evident, the most basic sales concepts haven’t changed much over the last few millenniums.
Bazaar traders have been throwing oral sales pitches and showing off goods for thousands of years. But in online stores, the product’s characteristics and sales pitches are transferred by text and multimedia. Haggling, a core sales technique, has almost died out following the emergence of fixed-price commercial stores and eCommerce.
Today, it is hard to find a commercial store that allows consumers to get a more favorable price by bargaining. There are a few price comparison platforms, like Green Toe which enable users to name their price and then try to find a retailer who is willing to accept it. The negotiation process ends there, but it is still much more open than at the standard fixed-price online stores.
Digging a Little Deeper
In researching this article, I failed to find a retail website that openly endorses haggling. My search was destined to fail because even when you are buying at the bazaar, the haggling process starts after you disagree with the price. Retailers who let us know they are open to bargaining, lower their product’s price from the very start.
Even with this in mind, I was hoping to find at least one website that uses haggling as an extra promotional feature that attracts ‘bargain hunters.’ No luck!
To see how companies react to haggling attempts I have contacted several customer service representatives and asked them for a discounted price on store items. While bargaining attempts in the location-based store can be viewed as an insult, the representatives I have talked to through live chat were very polite.
They explained that the prices are fixed, and offered me help in finding an item that fits my budget. This limited research has proved my point. Finding an online store that allows haggling is next to impossible.
Why do online retailers avoid bargaining?
It is because they think the process will hurt their reputation and lower their prices. The solution to this problem lies in absolute discretion. Just as in the bazaar, the bargaining process should be started by the retailer, discretely, and only when consumer apparently wants to leave the website.
In digital marketing terms, you can view this type of bargaining as a remarketing technique. For example, the attempt to leave the checkout page should activate the popup that will offer a lower price, or allow consumers to state how much they would like to pay.
That is one way to start bargaining discretely. The other is to run the whole checkout through live chat. The live chat strategy requires entrepreneurs to employ a sales representative, who will lead prospects throughout the sales funnel and offer them a lower price if they decide to quit the process.
Although the live chat bargaining allows entrepreneurs to engage prospects with their sales skills, it still requires companies to employ at least three sales representatives to cover all purchases 24/7. Unfortunately, these expenses are unacceptable for most small- and medium-sized retailers.
Chatbots Come to Rescue
Adding a chatbot to your online store is an elegant way to automate customer service, support, and sales processes. Since people are still doubtful when it comes to automation, I have decided to create a custom sales chatbot, and show you how a few code snippets can drastically increase your store’s conversion.
I named my chatbot Michelle the Wonder Sales Bot and programmed it to offer one store item and bargain with visitors when necessary. If you want to bargain with Michelle, stay strong and don’t fall for her charm.
The best thing about chatbots like this is that you can make them without coding. I have used the Snatchbot platform, which comes with a payment functionality, a ‘Quick replies’ feature, and the arithmetic functions necessary for calculating prices during the bargaining process.
Consumers miss bargaining in the era of mass digitalization. Chatbots and live chat sales, won’t turn online stores into dusty bazaars, but they will make the online shopping more personal and allow digital retailers to show off their human side. Since eCommerce is one of the most competitive business niches, bargaining will help merchants to make their stores stand out and sell their products faster.