Dumb Policy: Store Charges $5 Just To Look At Goods, To Keep People From Looking And Then Buying Online

from the add-value,-don't-take-it-away dept

It's really incredible how many bad strategies legacy companies come up with in trying to compete with the internet. Rather than increasing their own value and figuring out ways to leverage that value, they often go in the other direction and make the experience worse. Case in point, this store in Australia that is so fed up with people shopping in the store, but then buying online that it's now charging people $5 as they enter just to look around. If you buy something, the $5 counts towards the purchase. If you don't, the store keeps it.
In case you can't read it, the sign says:
As of the first of February, this store will be charging people a $5 fee per person for “just looking.”

The $5 fee will be deducted when goods are purchased.

Why has this come about?

There has been high volume of people who use this store as a reference and then purchase goods elsewhere. These people are unaware our prices are almost the same as the other stores plus we have products simply not available anywhere else.

This policy is line with many other clothing, shoe and electronic stores who are also facing the same issue.
This story originally got attention via Reddit, and looking at some other photos it appears the store is called Celiac Supplies, and is a "gluten free grocery store."

I can understand where the thought process to do something like this comes from. For years, of course, we've heard things about how Best Buy has basically become Amazon's showroom. But this is the exact wrong response. Rather than showing ways to add more value to the customer experience so they want to come in, they're taking away value and giving customers reasons to never go in in the first place. That's a stunningly short-sighted way of running a business. The people who were coming in, seeing what was there and then ordering online aren't suddenly going to start paying you for stuff anyway. They'll keep shopping online. But, on top of that, some existing customers who are used to buying will be turned off by this and also switch to buying online.

In fact, this seems to be screaming out "hey, you get better deals online and we know it!" Not smart.

Instead of doing that, why not look for ways to add value? For a specialist store like this, they could create all sorts of additional value, including more support in helping customers find what they need, the ability to offer bundles and recipes, cooking classes and much much more. The focus should be on using the local store to provide more value rather than taking away reasons to shop there.


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    Ninja (profile), Mar 27th, 2013 @ 4:28am

    Sounds like something the MAFIAA would do. Other than that it would be a 100% efficient way of keeping 100% of the people I know from going into the shop. With a few exceptions that would pay the first thinking there's something useful there just to be disappointed.

     

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    fogbugzd (profile), Mar 27th, 2013 @ 4:52am

    So do if I get a discount if I get information online and go to the store to make an actual purchase? It seems like I should because I am not bothering store personnel with questions. The store is benefiting from information I got elsewhere.

     

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      Anonymous Coward, Mar 27th, 2013 @ 8:11am

      Re:

      No, you should make a 5 dollar donation to which ever website you got the info from to help support it.

       

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      Jesse (profile), Mar 27th, 2013 @ 9:52am

      Re:

      Exactly right. This can go both ways.

       

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      Anonymous Coward, Mar 27th, 2013 @ 3:03pm

      Re:

      Ive done this on a few occasions, when i cant be assed to wait for delivery, and ofcourse at reasonable prices, with the replies here, im gonna gander a guess and say, quite a few people do

      Good point brought up thumbup

       

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    Kevin Bondelli (profile), Mar 27th, 2013 @ 6:09am

    Dumbest Business Decision of 2013

    "This policy is line with many other clothing, shoe and electronic stores who are also facing the same issue."

    I'm wondering just how common this practice is. It has to be one of the worst business idea I have ever heard, it seems unlikely that many businesses would be that stupid to do it.

     

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      Anonymous Coward, Mar 27th, 2013 @ 6:18am

      Re: Dumbest Business Decision of 2013

      It's very common with clothing in Australia outside the major department stores. Clothes are half the price in the US, so people go and try clothes on, get your size, then buy from overseas

       

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        Vidiot (profile), Mar 27th, 2013 @ 6:28am

        Re: Re: Dumbest Business Decision of 2013

        Not a new concept... thirty years ago, we'd try out high-end audio equipment at a national chain department store, and then head for the sealed carton, no-display warehouse retailer, and pay 30% less.

         

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      Niall (profile), Mar 27th, 2013 @ 6:37am

      Re: Dumbest Business Decision of 2013

      It used to be not uncommon for some stores in Europe to have an 'entry' charge if you don't buy anything, but it's pretty rare these days.

      The only way I can see this actually working is if you gave customers a voucher to get something from the store's website to promote brand loyalty - otherwise it'll just drive people away from casual browsing, and even those people who know what they want. Also, is this per head or per family - that would also have an effect.

      Way to cut out all those poor-but-tech-hungry teenagers & students though!

       

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      gorehound (profile), Mar 27th, 2013 @ 9:36am

      Re: Dumbest Business Decision of 2013

      Just as dumb as the MAFIAA ! Just Boycott the Store and go elsewhere.Plenty of other Content on the Internet and thru Local Art just like there are other Stores to Enter and other Stores on the Internet for those who Shop Online.

       

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    Capitalist Lion Tamer (profile), Mar 27th, 2013 @ 6:09am

    Oh, good

    A store with a paywall.

     

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      Not an Electronic Rodent (profile), Mar 27th, 2013 @ 8:16am

      Re: Oh, good

      "Oh noes! Those pirates are STEALING our floorspace and air now! Those internets are KILLING real businesses! WE NEED A LAW, QUICK!"

       

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    Maltesh Notovny (profile), Mar 27th, 2013 @ 6:12am

    Back in 2011, I made a tongue-in-cheek comment suggesting bookstores charge admission to milk the "just-looking" customers.

    http://www.techdirt.com/articles/20111214/06322517083/local-bookstores-call-boycott-am azon-advertising-their-prices.shtml#c1087

    I didn't actually think there'd be stores insane enough to do it.

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:14am

    and Australia complains about software price gouging?

    If a look is worth $5 down under, of course they're going to be charged more for an actual product they can use!

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:15am

    She's been interviewed here. She's not worried about people buying online. She's referring to people buying from one of the 2 large supermarkets - Coles & Woolworths. Neither of which have staff that know details of the products. So they get expert advice off her, then go to the other stores.

     

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      Vidiot (profile), Mar 27th, 2013 @ 6:24am

      Re:

      Thanks for adding that detail... makes it less about "the evils of online selling".

      But that shifts the focus back to where it belongs: adding value. It's tough to compete on price alone... you'd better be offering something the bulk retailer can't easily offer.

       

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        Anonymous Coward, Mar 27th, 2013 @ 8:08am

        Re: Re:

        the issue will still be that if everything else they offer is free, it doesn't stop the person from using that 'free' service and then buying goods elsewhere. you can add all the value you want, but if they can still get that value but go to another store and buy it cheaper, that will stop happen. you have to bet on the goodwill of people to say i want to pay for this extra service. not to say the approach the store took is the better one, but what is being said isn't without its faults. it doesn't change the equation at all. they get all the value they want at the store but still buy elsewhere. if they keep providing more and more value *for free* how will that get people to stop going elsewhere? its just something to think about.

         

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          Anonymous Coward, Mar 27th, 2013 @ 8:10am

          Re: Re: Re:

          You don't build up good will by treating customers as if they are stealing from you when they don't buy anything.

           

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          Michael Long (profile), Mar 27th, 2013 @ 10:22am

          Re: Re: Re:

          Ditto. Same for the other "value" adds. Advice. Take it and leave. Classes? Attend and buy elsewhere.

          Sounds to me her primary answer should simply be to add value AND advertise that they will price match any other store. Shouldn't be hard to do if their prices are "almost the same."

           

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        Bengie, Mar 27th, 2013 @ 10:17am

        Re: Re:

        Business 101: When you charge too high of a margin and you lose all of your business, it's probably time to lower your margin.

        Increase that revenue!

        People are taking their time to drive to another store because there is enough incentive to not purchase from her.

         

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          AB (profile), Mar 27th, 2013 @ 11:41am

          Re: Re: Re:

          "People are taking their time to drive to another store because there is enough incentive to not purchase from her."

          Exactly. I am also highly skeptical of her facts: how did she come to the conclusion that so many of her customers did this? Did she actually distribute a questionnaire and take a survey, or is this just a baseless assumption?

          In any event it blows my mind to imagine ordinary people actually paying that fee. I know I wouldn't.

           

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      Milton Freewater, Mar 27th, 2013 @ 9:43am

      Re:

      "So they get expert advice off her, then go to the other stores."

      I guess she solved that problem.

      Now they go online and then to Cole's or Woolworth's.

       

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      Ninja (profile), Mar 27th, 2013 @ 1:56pm

      Re:

      Still a bad idea. I think there are better ways to deal with the problem.

       

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      Cowards Anonymous, Mar 27th, 2013 @ 2:03pm

      Re:

      "So they get expert advice off her, then go to the other stores."

      So why doesn't she just charge for her advice then?

       

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    Josef Anvil (profile), Mar 27th, 2013 @ 6:15am

    WTF

    Ummmm. I was thinking of something to say about the policy itself, then it hit me.... wait for it....

    Who goes into a grocery store to window shop for a later purchase online??????

    Ok, I have done grocery shopping online in order to AVOID going to the grocery store, but I have never gone into a grocery store to see what deals I can find online. I would have to say that 99% of the times I have entered a grocery store, it was with intent to purchase.

    People need food to live. It's not the same as clothing or electronics. So I would have to say they are just using that example as a quick cash grab that will most likely lose more customers than it attracts.

     

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      Anonymous Coward, Mar 27th, 2013 @ 6:27am

      Re: WTF

      Indeed. I can imagine someone going to an electronics store to try out a pair of headphones and then buying online. But groceries? Not unless they offer free samples.

       

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      ShellMG, Mar 27th, 2013 @ 7:23am

      Re: WTF

      Rather than charge a $5, why not put an ad in the window that advertises what you WILL get by buying at the store rather than online? What about a "frequent buyer's club" or other personal interaction sales points? I guess that would make too much sense.

      The closest thing I've done to ordering food on line has been Sam's Club Click-&-Pull and an order of Olga Bread (it was cheaper buying a case direct than driving 30 miles to the nearest market selling it).

      Good point about the grocery stores and intent to purchase. I personally don't think anybody really wants to go there.

       

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        Michael Long (profile), Mar 27th, 2013 @ 2:44pm

        Re: Re: WTF

        I mentioned price matching above, but a loyalty / punch card approach has merit too.

        And both promotional ideas make more sense than Mike's one-size-fits-all value mantra.

         

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      JEDIDIAH, Mar 27th, 2013 @ 10:32am

      Re: WTF

      Yes. That is peculiar. The same goes for the advice too. I would not expect any store clerk to have a clue. I've been to hippie grocers where the clerks didn't even recognize basic vegetables.

      As far as FOOD goes, if anything I would look for any "advice" online and then perhaps buy something locally.

      This speciality vendor should have all of the things that the big chains don't. If this speciality vendor can't offer that then they have no reason for existing.

      You gotta offer something. Free advice probably isn't good enough.

       

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        AB (profile), Mar 27th, 2013 @ 11:56am

        Re: Re: WTF

        " I would look for any "advice" online and then perhaps buy something locally."

        Indeed, getting advise from a salesman at a local store is probably the _last_ thing I would do since they are the most likely to try misleading me. Normally I do my research online before going to the store, then if the salesman completely disagrees with the info I got online I _may_ go back to the internet to study that difference before making my final decision.

        Perhaps it is simply that we are so much more intelligent then her customers that we make them look like drooling idiots. Or maybe that's just her opinion of them, though I have to wonder considering she is apparently not the only one doing this. I'm glad I'm not an Australian because I'd be terribly embarrassed for any remaining customers these stores have.

         

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        Anonymous Coward, Mar 27th, 2013 @ 12:02pm

        Re: Re: WTF

        It depends on the store. The hippie chains (whole foods, fresh market, etc.) don't always know things. However, the privately owned ones where the owner is *in* the store while it's open can be useful. There was this liquor store near my parents house and the store owner would be in there while it was open. He personally had tried every type of alcohol in his store as the whole reason he opened the store was his passion for alcohol (yet wasn't an alcoholic). He could easily provide help on all types of wines, whiskies, and beers.

         

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    Anonymous Coward, Mar 27th, 2013 @ 6:20am

    So what do they say if a person comes in wanting to buy a specific product only to find out that it's out of stock?

    "Sorry, come back next week and thanks for the five bucks, sucker"?

     

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      Ole Juul (profile), Mar 27th, 2013 @ 7:11am

      tit for tat

      I was just thinking the same thing. The main reason I go into a store is to see if they have what I want. Often they don't - in which case I would like to charge them $5.

       

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        Scote, Mar 27th, 2013 @ 10:10am

        T-Shrit Wrap counter agreement

        I was thinking the same thing. Perhaps a t-shirt with the agreement that they will pay you twice what ever they charge for browsing because you are volunteering to be subjected by their point of sale advertising.

         

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    quawonk, Mar 27th, 2013 @ 6:29am

    As of the first of February, this store will be charging people a $5 fee per person for “just looking.” The $5 fee will be deducted when goods are purchased.

    Why has this come about? Because we are desperate!

    There has been high volume of people who use this store as a reference and then purchase goods elsewhere, a practice commonly known as "shopping around for the best price". These people are unaware our prices are almost the same as the other physical box stores like ours (ie. relics of the past), plus we have products simply not available anywhere else that are so special people will gladly pay five bucks for the esteemed honor of gazing upon them.

    This policy is line with many other clothing, shoe and electronic stores who are also facing the same issue. The issue being that the Internet has made us obsolete with better prices and the convenience of not even having to leave one's house. We're eager to go out of business, and you can aid us in that endeavor by shopping online like smart people.

    At least they don't charge $5 for visiting a website.

     

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    out_of_the_blue, Mar 27th, 2013 @ 6:38am

    ACTUALLY, this may work.

    There are local shows where you PAY just to go in and look: gun shows, tool sales, and probably ComicCon or whatever it is too: shows where they sell crap to help kids with their fantasies. So the principle is not unknown.

    But a furniture store is a stretch.

    However, on same line, look who's thinking of putting up a paywall!
    http://adage.com/article/digital/youtube-set-introduce-paid-subscriptions-spring/239437/
    If happens, may undermine your "free as paid by advertising" notions some more, huh?

     

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      PaulT (profile), Mar 27th, 2013 @ 7:57am

      Re: ACTUALLY, this may work.

      In all those examples you gave, you're paying for access to the show itself. A show by definition will almost certainly always provide extra features not available elsewhere - be it early access to upcoming releases, access to guests and lectures, access to specialist knowledge or other features.

      In other words, you basically agree with Mike - where extra value is given then the fee might be justified or even desirable. Where nothing is given, it's pointless and almost sure to damage the company rather than help it.

      The rest of your comment, sadly, is condescending bullshit with only a hint of truth. That's par for the course for you, but you almost had a point put across in a manner ready for adult discussion rather than an insulting load of crap so you can troll another thread. Pity. Although it is telling that in the part of your comment where you weren't being an obnoxious ass, you actually agree with the major point of the article.

       

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      Greevar (profile), Mar 27th, 2013 @ 8:28am

      Re: ACTUALLY, this may work.

      But those local events charge because they are not the vendor, they manage the event and provide the space for the vendors to sell. The event management has to pay for the cost of the building (they probably want to make a profit too), so they charge people for entry and the vendors attract people there. So the entry fee is to pay for the facility. None of it goes to the vendors, they are the bait. It's totally different from the scenario in the article.

       

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      AB (profile), Mar 27th, 2013 @ 12:07pm

      Re: ACTUALLY, this may work.

      Perhaps a more realistic comparison would be the yearly membership fee I pay to Costco. But that fee not only allows me to do all the window shopping I want, it also entitles me to a great number of excellent discounts and and extremely good return policy.

      That 'no question' return policy was directly responsible for many purchases I have made there of items which I had not researched. Simply knowing that I will face no issues returning it makes impulse spending very easy.

      And even there I check my overall return against the membership fee every couple of years to make sure it is still worth while.

       

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    Digitari, Mar 27th, 2013 @ 6:38am

    Re:

    "At least they don't charge $5 for visiting a website."


    Well, not yet anyways, but now that you brought it up.......

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:39am

    People no longer shop at that store since it costs you a minimum of $5.

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:39am

    Damn those grocery pirates and their sense of entitlement, always wanting their glutens for free.

     

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      Anonymous Coward, Mar 27th, 2013 @ 6:45am

      Re:

      Thing is you don't get any groceries for free. You get the privilege to pay to shop at this store. If this store isn't amazing then its pretty ridiculous.

       

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        Vikarti Anatra (profile), Mar 31st, 2013 @ 9:25pm

        Re: Re:

        Well, Amazon for example, charges you about 30USD for privilege of buying things in Kindle Store at any place you want (what else we can use 3G module for?)

         

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    Anonymous Coward, Mar 27th, 2013 @ 6:44am

    I saw the interview with her, it went a long way to changing my mind about her specific situation, not the sentiment behind the retailer vs online battle.

    What she basically said was, she was sick of people coming in and getting her consultation for an extended period, then leaving and buying the products online. I can see where she is coming from, and sometimes no matter how much value you add to the experience, people will try and avoid paying for anything.

    Perhaps she should set herself up as a "gluten free food" consultant and charge per consultation, as that's essentially what she said in the interview. She was acting as a dietician, who charge significantly more than $5/15 minutes, to then have the person leave without buying anything.

    Anyway, I think everyone is being caught up in the headline being presenting, without delving deeper into the specifics, which seemed reasonable to me.

    Reading techdirt for 5 years, first post :)

     

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      Baldaur Regis (profile), Mar 27th, 2013 @ 7:39am

      Re:

      Perhaps she should set herself up as a "gluten free food" consultant and charge per consultation...
      Indeed. And the sign on her store could reflect her willingness to do this, instead of reflecting her frustration. For myself, seeing a sign like that would make me turn around and head for the nearest computer.

       

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      Anonymous Coward, Mar 27th, 2013 @ 8:59am

      Re:

      Then that is what she should do. If someone comes asking for advice, she should politely state that in-depth consultations cost 5$, instead of basically telling everyone at the door to cough up 5 bucks or beat it.

       

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      akp (profile), Mar 27th, 2013 @ 10:06am

      Re:

      So rather than just gouge everyone who walks through the door, maybe she shouldn't offer so much free advice.

      She absolutely do what you said.

       

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      quawonk, Mar 27th, 2013 @ 12:24pm

      Re:

      Maybe these people buy it online because it's cheaper online. There's a solution to that problem. Be the cheapest price. Common sense.

       

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      Ninja (profile), Mar 27th, 2013 @ 1:58pm

      Re:

      Wait, so she's not charging for the sale itself but for counseling? Then it might be a good idea in the end.

       

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      athe, Mar 27th, 2013 @ 10:45pm

      Re:

      There are probably regulations about offering health advice (which is essentially what she'd be doing) for a fee... Possibly need to be certified. She'd potentially open herself up to litigation if she started charging for the advice.

       

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    Anonymous Coward, Mar 27th, 2013 @ 6:44am

    STUPID

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:49am

    To add, she also said that she just wanted the commitment of $5, for the time you took up questions, if you then purchased something, she would minus the cost of the item from the commitment, giving you money back if need be.

    She also stated that this "fee" would not be charged to people that just came in and looked, not engaged a sales staff in a lengthy discussion.

    I still think its not the best approach to building a happy and loyal customer base, but it's not the hysterically bad idea the media reported it to be.

     

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      Anonymous Coward, Mar 27th, 2013 @ 7:13am

      Re:

      That isn't what the sign says.

       

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        akp (profile), Mar 27th, 2013 @ 10:08am

        Re: Re:

        Exactly. If I saw that sign on the door of a shop, I'd stick my head in the door long enough to make sure they saw me, and then turn around and go right back out again.

         

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      Ed C., Mar 27th, 2013 @ 7:44am

      Re:

      Thanks for adding to the discussion. It sounds as though she had thought this through more than the article, or even her own sign, would imply. If her intention was to charge a fee for consulting rather than mere entry, she should have just came forward and been direct about it on the sign. She could even spin it in a more positive light. "We appreciate your patronage so much that we are now offering a new consulting service. Those who use our new service can apply the consulting fee towards their purchase." That way, people know exactly what they are paying for. Those who only want to "consult" may even find the cost worthwhile, as professional consultations would be considerably more expensive, and might even be enticed to buy something just to get the service for free. Either way, she comes out ahead and both feel they have gained something from the exchange.

       

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        AB (profile), Mar 27th, 2013 @ 12:15pm

        Re: Re:

        This is exactly the sort of thing I believe people would be willing to pay a membership fee for. Unfortunately, her sign indicates complete disrespect of her customers.

         

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        art guerrilla (profile), Mar 28th, 2013 @ 11:10am

        Re: Re:

        excellent response, EdC; pity she didn't think of it before she shot herself in the foot...

        oh, i'm *really* hatin' on these linky/ad-like things at the bottom of the screen that i can't really see, anyways...

        in fact, as a matter of principle, i HATE all that crap...
        it is just like stupid tee vee, where they have so many stupid fucking annoying ADS for their stupid shows overlaid their current stupid show i am stupidly trying to watch...

        its gotten so you've got the channel's stupid bug in one corner, another stupid bug for the affiliate, then a HUGE animated banner overlaying 1/4 to 1/3 the screen WHILE THEIR OWN STUPID FUCKING SHOW IS ON THAT I NOW CAN'T SEE OR AM SO DISTRACTED I GET PISSED OFF AND CHANGE THE CHANNEL EVEN IF I WANTED TO STUPIDLY WATCH THAT STUPID SHOW...
        fuckers

        we get shit on for stupid stuff WE PAY FOR; forget about piracy, etc: we get FUCKED OVER FOR LEGAL, PAID-FOR content, and despise Big Media for THAT alone...
        fuckers

        art guerrilla
        aka ann archy
        eof

         

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      Anonymous Coward, Mar 27th, 2013 @ 2:41pm

      Re:

      I shop online, but I do not go into box stores to try items on, or hold them and ask questions. If I need that kind of support, I buy local. If you are using the local stores for research, especially when you have to bug someone trained in the subject matter, but buying elsewhere, you have taken advantage of the value they add, but not paid them for it.

      I agree with her approach and wish her luck. If you do not need their advice, you will not be charged. If you need advice, but think their advice is not worth the $5, you probably were going to shop elsewhere anyway as price is more important to you.

       

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    Ben, Mar 27th, 2013 @ 6:52am

    Not very clever. If they did a club model, like Sam's Club, they could create the kind of exclusivity that these kinda boutiques like, the membership fees would keep out the riff-raff and protect their bottom line.

    This response is simply an insult to people who are trying to be smart shoppers.

     

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    retail, Mar 27th, 2013 @ 6:53am

    i once worked a circuit city. i remember at a meeting another employee asked the manager if we will ever consider pricing matching online stores like amazon. The managers reply was that "those online stores dont have the overhead that we do and we can't price match them". I remember thinking to myself that might be true and is logical but why should the customer care about our overhead. What reason does the customer have to come to circuit city instead of shopping online. No answer was ever given and a few years later the company was no more.

     

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      Anonymous Coward, Mar 27th, 2013 @ 11:55am

      Re:

      the problem was that they'd still get very high traffic, because no one wanted to buy extremely expensive equipment without seeing it first. So they'd go there, try it out, and buy it elsewhere. Ultimately, these 'showrooms' offer a lot of value to customers, but the customers don't pay for it. Not saying they should, but physical stores offer a very real value over online stores and they charge for that extra value. People just feel like they shouldn't have to pay for it though. If no one pays for it, they go out of business and you lose the ability to try before buying. In the end, the customer gets hurt for being a "smart shopper."

       

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      AB (profile), Mar 27th, 2013 @ 12:22pm

      Re:

      Shipping costs and returns are major issues with any online purchase. Amazon or Newegg may well have better pricing, but by the time I've paid for shipping much of that gain is lost. And if I receive a faulty product it gets worse very quickly since I now have to pay return shipping in addition to not knowing when - or if - I will get my reimbursement/replacement. Personally, I have often chosen to pay a little extra simply because the store has a better return policy.

       

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        Anonymous Coward, Mar 27th, 2013 @ 3:24pm

        Re: Re:

        I'm not sure which country you reside in, but here in the UK I'd much rather buy online as we have something called the "distance selling regulations".

        It basically states that as a customer has purchased goods without being able to inspect them, they are guaranteed a period of 7 days to return the goods for whatever reason.

        There are a few exemptions, but on the whole it's a very good arrangement and has likely contributed to the UK's massive adoption of online services.

         

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    Englebert the Immensely Well Endowed In Trouser Sn, Mar 27th, 2013 @ 7:13am

    Surely a far more effective solution

    would be to put up a display showing the prices online.

    They may not be able to match the prices, but if the stock there in front of the customer and they can walk out with it now, they'll probably accept an extra 50c.

     

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      Anonymous Coward, Mar 27th, 2013 @ 7:14am

      Re: Surely a far more effective solution

      It always boils down to businesses do not want to compete.

       

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        Anonymous Coward, Mar 27th, 2013 @ 2:48pm

        Re: Re: Surely a far more effective solution

        She is trying to compete. She knows price is not something she can compete with a large retailer on, so she has focused on adding value through subject matter knowledge. It is obvious people find value in this as they keep coming in. They are just not willing to pay for that value. The only customers she is going to discourage are the freeloading ones.

         

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          Ole Juul (profile), Mar 27th, 2013 @ 11:18pm

          Re: Re: Re: Surely a far more effective solution

          I still think she will put many people off. Traditional business has always tried to encourage as many people as possible to visit their store - for any reason whatsoever. Being popular is a characteristic that benefits a business. Being expert and trustworthy gives extra points. In this case it sounds like the business owner made a mistake in trying to compete on price when in fact that isn't the kind of business she was in. I think the whole problem here is a matter of incorrect pricing.

          I've worked in a store were we were in the business of giving out trustworthy and expert information as an essential part of what people came there for. When I mention something about prices being lower elsewhere, my boss just said, let them go there then. It was a very successful business, with very strong customer loyalty.

          The problem of people going elsewhere is age old. It would appear that the "value added" part of this store under discussion, is not valued by some of its current "customers". Perhaps if the staff were to practice up on treating visitors well and being nice to them, they would be more successful. They might even be able to increase their prices substantially to pay for the extra value. Trying to compete on price is often a mistake. In fact it can encourage the wrong kind of customers - those that don't appreciate the value of what you are selling. Forget them. They're wasting your time, and you're wasting theirs. Just put up the prices to be fair for what you're really selling, and the "deadbeats" will go away.

           

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    Rex Rollman (profile), Mar 27th, 2013 @ 7:16am

    Having worked at a Barnes & Noble, where lots of people treat it like a personal lounge and don't bother to buy anything, I can understand *wanting* to do it, but to actually do it is probably not a good idea.

     

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      akp (profile), Mar 27th, 2013 @ 10:11am

      Re:

      I thought B&N was actually being pretty smart about that. If you had a Nook, and came in to the store, you'd get coupons and sample chapters sent to your Nook when you walked in.

      They know they're a library where "checking out" a book means "go to the check out and pay."

      I really should go buy a magazine or something... I'd like bookstores, even huge corporate ones, to stick around.

       

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      Anonymous Coward, Mar 27th, 2013 @ 6:44pm

      Re:

      Doesn't Barnes & Noble ENCOURAGE that behavior?

       

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    Prashanth (profile), Mar 27th, 2013 @ 7:20am

    Bankruptcy articles

    Then they will charge $10 every time you walk past the store without going in (in addition to the $5 charge for not buying anything).
    Then they will charge $20 for every person who reads an article about its impending bankruptcy without walking past the store (in addition to the above charges).
    Then they will charge $40 for every person who reads an article about its bankruptcy and did not call them to provide some support against impending bankruptcy (in addition to the above charges).
    Then they will charge $80 for every person who did not attend the going-out-of-business sale (in addition to the above charges).

     

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    Anonymous Coward, Mar 27th, 2013 @ 7:32am

    Grow up mikey. It's a business, they are charging for a service they provide. You're always trying to hype up new business models, well this is one of them. People want to see, touch, and try out things before they buy, this lets them do so.

     

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      Anonymous Howard (profile), Mar 27th, 2013 @ 7:36am

      Re:

      Exactly what service they actually provide?

       

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      Anonymous Coward, Mar 27th, 2013 @ 7:39am

      Re:

      No, they're charging for not providing a service, just like your bosses at the MPAA.

       

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      Anonymous Coward, Mar 27th, 2013 @ 7:58am

      Re:

      People want to see, touch, and try out things before they buy, this lets them do so.

      That's funny, folks have had this ability for decades. And they didn't have to pay some silly fee for the privilege of doing so.

      This fee isn't a new business model. This is a "help me go out of business fee". Seeing that sign, most folks would see it for the arrogance that it is and would turn and walk the other way and visit a different store that actually values their customers -- yes even the ones who don't always purchase something.

      Stores that want to engage in this practice do so at their own peril. I simply will not shop at establishments that do this. Guaranteed that I will take my $5 elsewhere.

       

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      PaulT (profile), Mar 27th, 2013 @ 8:03am

      Re:

      "You're always trying to hype up new business models, well this is one of them."

      Mike "hypes" new business models that are doing something new/interesting and have a future. This fits neither criteria.

      "People want to see, touch, and try out things before they buy"

      I've done this my entire life, and I've never been charged for it before deciding to purchase. In fact, some stores actively encouraged me to take free samples or discounts in order to attract my business. What's changed?

       

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        Anonymous Coward, Mar 27th, 2013 @ 8:36pm

        Re: Re:

        A family-run camera store near me encourages its customers to buy through their own website and save 10%. You can profit from their advice, and still buy online. I liked the atmosphere. I made my purchase in store, saved time.

         

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      Anonymous Coward, Mar 27th, 2013 @ 9:11am

      Re:

      Sure, it's a new business model. Just don't come crying and screaming "piracy" when people with half a brain cell realise that your business model is utter rubbish.

       

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    trish, Mar 27th, 2013 @ 7:33am

    YOU hould pay ME to shop in your store! lol

     

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    Anonymous Coward, Mar 27th, 2013 @ 7:38am

    How bad do their prices have to be for people to go so far as to travel to the store, ask questions about it, decide they want the item, and then elect to wait a few days instead of just leaving the store with it? Personally I'd only tolerate that kind of delay if the price difference was pretty damn large, like 20%+.

     

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    Australian, Mar 27th, 2013 @ 7:47am

    Comparative solution?

    Mike (and I don't expect you to respond - hell I'd sincerely prefer you to continue your excellent work on this website, especially Prenda et al),
    I am curious as to your suggestion. While I do not live in Brisbane, similar stores where I live price their products based on the added cost of the advice that they provide i.e., paying someone to help you with your decision.
    I personally work for a retailer whose business strategy is built around the principle that people are prepared to pay for the service, but by my five year experience, only 1 in 10 at best people pay for it (the company finds that this is more like 1 in 25 but service varies from person to person).
    Your suggestion is that the retailer competes by spending more money on added value, but you imply that they should do so without raising prices. I have dealt with countless people who spend time (and by time, I mean 30-60 minutes at AWARD (acronym) rates plus overheads) with me to determine what meets their needs only to walk out of the store. Then they go and buy it elsewhere.
    I do not have an issue with genuine people people who seek a better OVERALL deal, i.e., people who value the service, but I detest those who treat retailers as a try before you buy online doormat. I have personally dealt with a number of people who waste my time, buy online, then come back to me for help with their product! Worse are the few occasions where people expect me to fix their products that they didn't purchase from me!
    My employer has records that exemplify people who have wasted, on a significant number of occasions, hours of staff's time costing the company hundreds of dollars, and in some cases, thousands of dollars. This has gotten to the point where we have had to ask certain people to leave the store and not return.
    So again I ask, how do you add value without increasing cost? Or more simply, how do you deter people who have no intention of making a purchase from engaging with staff members?
    PS I was under the impression that companies like B&H Photo Video charge people to look at merchandise - how is this different, and has this been unsuccessful?

     

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      ChrisB (profile), Mar 27th, 2013 @ 8:36am

      Re: Comparative solution?

      I really see no other solution than stores like Best Buy charge a membership fee. I'd pay a fee to go and try out computer equipment. They could refund the fee with your first purchase.

      The huge advantage B&M stores have over online is physical presence of the merchandise, plus knowledgeable sales people. I'd pay for that. Giving that away and hoping people will buy stuff is dumb. I totally disagree with Mike on this one.

       

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      The Old Man in The Sea, Mar 27th, 2013 @ 1:12pm

      Re: Comparative solution?

      Stores go out of their way to maximise profits. Having had an insight into POS systems, I know that many only allow staff to see bottom line costs (for negotiation purposes) that already have a specific profit margin included. This ensures that the staff cannot sell an item at real cost (and hence no profit made). I have forgotten what they call this.

      I recently did a shop around for a new blender at a couple of local retailers (one being a Harvey Norman store). I managed to get a price at Harvey Norman for what I wanted at a discount (still knowing they could go further) without doing the actual purchase.

      I came home and discussed with my wife what she would like, took her back to the store and we made the purchase from the specific sales staff I first spoke to. There were other staff available but I don't like some of them, as they never smile and always look they have been sucking on real sour lemons all day. I could have made an even better deal online but in reality, I prefer to shop locally where I can for the convenience and the service.

      Even at our local Woolworths, I will only use the self serve checkout area only when there are long queues for the human manned checkouts. I like the interaction. In some respects this is strange since I have been programming computer systems for over thirty years.

      The upshot is that people will purchase if all the boxes are ticked and those boxes are as individual as the person. If you are a retailer you have to understand this to be successful.

       

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        Australian, Mar 27th, 2013 @ 4:42pm

        Re: Re: Comparative solution?

        I think the pricing structures are known in that sector of retailing as Invoice (the price the company pays the wholesaler on 14/30/60 day terms), Net (the price paid to the wholesaler but with deductions for volume discounts, rebates .etc that are paid at the end of a (typically) yearly period) and Floor (the invoice price plus a general added cost for stocking the product - rent, wages, other overheads .etc). YMMV with the names.

        I am glad to hear you had a good experience (no, I do not work for Harvey Norman), and that you sought the staff member out - since their ongoing employment requires them to meet sales targets, it's all too easy for a returning customer to be snapped up by a different staff member.

        But customers like yourself are few and far between and because of the nine other people who wasted the staff member's time, the price you paid was raised to compensate for this added cost.

        The question is - would you be prepared to pay even more money when an even smaller percentage of people actually make a purchase?

         

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    nytimespaywall, Mar 27th, 2013 @ 7:49am

    Paywall for store browsing? Thats a new one. Some of the news sites in Google News search that say "subscription required" are really retarded too. As if news on the topic is hard to come by thanks to the invention of Twitter search.

     

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    Anonymous Coward, Mar 27th, 2013 @ 7:53am

    So hard to understand some people.

    If people are unaware that your prices are almost the same as other stores or that you carry products not available elsewhere then in typing up the notice you should have realized that you are identifying failures of yours and in your business.
    Attempting to charge, potential customers for your own failures in informing people of your selling points is bizarre in the extreme. A sign like that will discourage people from entering your store and that is pretty much the exact opposite of what any store owner should be attempting to do.

     

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    votre (profile), Mar 27th, 2013 @ 8:00am

    Nice of them to leave us that suicide note so there's no question about who put the bullet in their head.

     

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    Jeremy Higginbotham, Mar 27th, 2013 @ 8:02am

    Unfortunately I work retail for a long time and it was getting to the point that customers would get mad at us for not carrying an item they wanted to check out before buying online.

     

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    Libby Stack, Mar 27th, 2013 @ 8:30am

    On Best Buy becoming Amazon's showroom - if BB would hire service professionals instead of snotty smart mouth kids then perhaps I would be more inclined to go there. On the last 2 visits, I couldn't wait to get out of the store.

     

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    kcritter46, Mar 27th, 2013 @ 8:34am

    So if I study the prices online and then come and make my purchase at the store, can they be compelled to pay me $5.00? I could provide printed proof that I researched online.

     

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    Nathaniel Brown, Mar 27th, 2013 @ 8:45am

    I used to leave near this store

    Hi everyone,

    Thought I might share since I actually use to live a few blocks away from this store. The store itself is in the middle of suburbia so there is no reason to go to the store unless you want to go to this specific store. You would not just go there and look around. You would not EVEN find it unless you were actively looking for it. So I can understand her frustration when people would have had to:
    1. Look it up online or in the telephone book.
    2. Drive to the store (for most people at 15+ minute drive).
    3. Come in, ask questions and get high quality service.

    It's not like anyone is just looking around to see what the store is like or if they have something in stock.

    She has also imported a number of products that most stores do not stock.

    That being said it is a 5 minute drive from 2 large grocery stores and they offer some of the gluten free products but not the same range as this store. For people that cannot eat glutton this store is great but you would still need to go to the grocery store to buy the rest of your food.

    As for buying food online it would not be a big issue for her since customs and shipping fees would making buying food from overseas too expensive. Also there are not many stores that sell food online in Australia.

    There are other stores that have sections for gluten free (health stores) but nowhere near as big as her selection. That being said I never shopped there since I am not a coeliac and when my auntie comes over that is a coeliac we generally cook meat, vegetables and macraoons which she can eat.

     

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    kog999, Mar 27th, 2013 @ 9:06am

    "The huge advantage B&M stores have over online is physical presence of the merchandise, plus knowledgeable sales people. I'd pay for that"

    Stores used to have knowledgeable sales people. Now they have nothing but slightly over minimum wage drones that dont know or care to know the products at all. They care more about selling as many warranties as possible then customer service.

     

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    droozilla (profile), Mar 27th, 2013 @ 9:19am

    How to deal with this.

    Step 1: Go to location, stand outside, don't go in.
    Step 2: Take out internet connected device.
    Step 3: Shop.
    Step 4: Go inside store, show dummy the reciept of your purchase, explain that the stpuid $5 charge just cost you $x in sales.
    Step 5: Repeat as necessary until idiot realizes this is stupid and/or closes business.

     

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      TroutFishingUSA, Mar 27th, 2013 @ 10:42am

      Re: How to deal with this.

      Step 6: Go home and wait 4-5 business days for your *FOOD* to be misrouted by DHL/UPS/etc.

      Step 7: Continue blasting your leg after your foot has sufficiently been shot off.

       

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    Anon, Mar 27th, 2013 @ 9:46am

    What complete numbnuts.....

     

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    bob, Mar 27th, 2013 @ 12:30pm

    reaching goals

    I would think that the more people in the store the better.
    I would want people to come in, even if they're only customers one out of three times.
    because the more they are used to walking into your store, the more likely they are to buy something, or several somethings, that they might not have bought if they were not in the store.

    I get the whole, 'quit using me' attitude,
    but as a business, I'd want people referring to me as often as possible, building a relationship, and increasing the odds they do business with me.

    otherwise it's like saying "you can browse my website if you promise to buy something worth at least $10. pay now, before we allow you to browse, because we put a lot of good information on our site, and we don't want you reading our reviews and then going elsewhere."
    just seems like although some people would pay (yeah, I know, I know :-P ) the overall traffic would go into a downward spiral. there would be less cross selling and spur of the moment purchasing.

     

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      Lil' Aussie battler, Mar 27th, 2013 @ 2:14pm

      Re: reaching goals

      Strange thing about this store is they have a website with plenty of info on it and it is free to visit, http://www.celiacsupplies.com.au/home?subSiteId=1
      but like most Aussie websites it is a price free zone (yes there are general price points on this website) and they expect you to come in to find out their prices and I suppose grab a sale. Some of the excuses companies large and small use when you query this colonial policy defy belief especially when many overseas websites are quite happy to show their prices.
      Even stranger is that despite a web presence they don't appear to do online sales, or if they do it is very well hidden. I say this because one of my favourite small specialist stores is into some of these products and does manage to sell online bulky goods throughout Australia without whining about it. In fact they have rather good sales online and it helps to keep their B&M store open.
      I find in this instance a small specialty store which charges customers to enter their store a surefire recipe to piss off potential customers and to ultimately shut their doors for good. As someone else said, this sign states that they haven't done enough effective marketing to their potential customers on the good points of using their services.
      Living thousands of km's away I have never been in the store, but maybe their customer service and attitude isn't what one would expect from a small specialty store.

       

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    Maxwell (profile), Mar 27th, 2013 @ 1:42pm

    Times are changing faster than expected.

    Natural selection in the capitalist sphere seems to have hit the overdrive recently. Artists, Shops, large corporations (news and entertainment), etc. are hellbent on removing themselves overnight from the gene pool of anything that will be relevent to the next society. All in the name of weak conjectures. We should hand them Darwin Awards.

    That shop owner just made sure it will not get any new customers(genes) and most likely annoy the loyal ones enough back to the supermarkets. Forever. I wonder how the owner plans to measure the cost/benefit of that or is he just going to roll with empty conjectures.

     

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    Anonymous Coward, Mar 27th, 2013 @ 2:22pm

    Are they going to charge $1 cover for the going out of business sale?

     

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    Thomas (profile), Mar 27th, 2013 @ 4:12pm

    Good way

    to make sure you get no browsers. I love browsing in stores and don't always carry cash. I don't "showroom". If a store told me I had to pay $5 to go in, that would be the last time I went near the place.

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:38pm

    what about the insurance industry ?

    you pay up front, you receive no product unless something specific happens then you MAY get some money, if you don't make a claim you don't get your money back.

    what about your local golf club? you pay a yearly fee, as well you pay for the specific times you use the facilities. If you don't pay the fee you don't get to go there and pay a fee to play !

     

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    Anonymous Coward, Mar 27th, 2013 @ 6:49pm

    At one time the state of Missouri actually passed a law that would require anyone entering a porn store to pay $5.00 just to get in. It was struck down 2 days before it was supposed to go into effect.

     

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    Anonymous Coward, Mar 27th, 2013 @ 7:07pm

    Maybe more stores should become like Costco and require an annual paid membership fee. That way they don't care if you use their store as a showroom, they get paid something for it regardless.

     

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      Anonymous Coward, Mar 27th, 2013 @ 7:12pm

      Re:

      and, as an added value (after reading through the comments, or at least some of the main ones), they can offer experts at the store. So those who pay for membership can get expert opinions.

      Though I would be very very careful about this as 'experts' can easily turn into 'salesmen' simply selling what is most profitable to the store and not what is solely in the best interest of the customer.

       

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    Anonymous Coward, Mar 27th, 2013 @ 8:09pm

    I really don't see the point of making this an ideological issue. Why not just sit back and watch the market decide?

    Personally I don't think the public is ready for a cover charge for window shopping. It's a little too blunt. And kind of hilarious. But if she succeeds, it's not a ripoff, just a price.

    Now if you walk into a shop on Bahnhofstrasse, THAT's a ripoff.

    You can subscribe to the Telegraph (new paywall just a few days ago) for 1.99 a month. Is 1.99 too high? Could be. It's the Telegraph, after all. But there's a price in there SOMEwhere.

    And watching these new, new crazy low prices get battled out is a whole lot of fun. That's why I love Techdirt.

     

    reply to this | link to this | view in chronology ]

    •  
      identicon
      Anonymous Coward, Mar 27th, 2013 @ 8:21pm

      Re:

      p.s. I've noticed that a particular kind of small business owner gets very paranoid and self-righteous about being "ripped off" and manages to communicate that atmosphere to their customers, where another one would just take it in stride. Maybe that's what's happening here.

      Curiously, at McDonald's in Switzerland, there is actually a small charge for one of those little packages of ketchup (as I recall it is about 30 cents).

       

      reply to this | link to this | view in chronology ]

  •  
    identicon
    greatguncases, May 3rd, 2013 @ 3:07am

    PELICAN CASES

    I don't have any words to appreciate this post.....I am really impressed .But Store Charges $5 Just To Look At Goods is not good for customers.

     

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  •  
    identicon
    Not a Mouse, Jun 4th, 2013 @ 8:34pm

    I don't get it. Why would the store add a $5 surcharge for looking at stuff in the store. Every store already has a pretty incredible mark up to begin with because they are unable to compete with the internet because of overhead. Their prices should be lowered and customers credited $5 for each product over X that they purchase. There really is no incentive to shop in stores anymore especially now that Amazon has spectacular return policies on many of their items.

    Option A: Pay more money for item #1
    Option B: Pay less money for item #1 save on gas, time, and stress, get to do it in your underwear (without getting weird looks from people)

     

    reply to this | link to this | view in chronology ]

 

I used to leave near this store

Hi everyone,

Thought I might share since I actually use to live a few blocks away from this store. The store itself is in the middle of suburbia so there is no reason to go to the store unless you want to go to this specific store. You would not just go there and look around. You would not EVEN find it unless you were actively looking for it. So I can understand her frustration when people would have had to:
1. Look it up online or in the telephone book.
2. Drive to the store (for most people at 15+ minute drive).
3. Come in, ask questions and get high quality service.

It's not like anyone is just looking around to see what the store is like or if they have something in stock.

She has also imported a number of products that most stores do not stock.

That being said it is a 5 minute drive from 2 large grocery stores and they offer some of the gluten free products but not the same range as this store. For people that cannot eat glutton this store is great but you would still need to go to the grocery store to buy the rest of your food.

As for buying food online it would not be a big issue for her since customs and shipping fees would making buying food from overseas too expensive. Also there are not many stores that sell food online in Australia.

There are other stores that have sections for gluten free (health stores) but nowhere near as big as her selection. That being said I never shopped there since I am not a coeliac and when my auntie comes over that is a coeliac we generally cook meat, vegetables and macraoons which she can eat.
—Nathaniel Brown

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