The Evolution Of Low Cost Retail: From Pricing Strategy to Shopping Experiences
Nowadays, to survive and be successful in the retail sector, points of sale experiences are critical. In fact, someone already coined the term, “Experience Economy”. In addition to offering goods and services, companies also add value by offering their customers a set of unique experiences, differentiating them from their competitors.
Price isn’t enough. In an environment of fierce competition, differentiating is necessary even for retailers focused on price, and to stand out it’s essential to put emphasis on the experience. Staying alive in the retail world means creating memorable experiences.
The Food Industry: A Clear Example Of Low Cost Evolving To Offer Experiences
The food retail sector is one of the greatest examples of what we mean by low cost retailers changing strategies. Many important retailers, like Dia, Aldi, or Lidl, have traditionally based their strategy on offering low prices. But today, this isn’t enough. Discounts have gone from being a market of marginal importance to being a primary activity in the retail sector.
So their strategy has changed, improving points of sale based on what’s relevant to the customer and developing shopping experiences.
To their classic customers, it’s not about getting the best deals anymore. They look for something more, and they look for it in experiences. This habit change also applies to the rest of their customers, who don’t believe that experiences justify higher prices, sometimes with lower quality.
This combination of factors explains the important growth experienced in recent years by discount supermarket chains.
What Have Been The Key Points in Creating Experiences at Low Cost Shops?
When it comes to understanding these changes, we need to stop and think about what aspects low cost shops have emphasized in order to offer better experiences to customers:
- Better quality products: no-name or generic products, commonplace at discount retailers, are a clear example. Many of these are of higher quality than their brand name equivalents and they are sold at a much lower price.
- Redesigning the store experience: this has been achieved by creating new store concepts, designing spaces, and creating specific sections to add greater value to products, especially fresh produce.
- Diversifying what’s offered: offering customers everything that they are looking for, and in a much more appealing and careful way, helps them to understand what’s offered and choose what they want.
- Convenience as a reoccurring theme: supermarket strategies have changed, not only by expanding fresh produce and ready-to-eat products, but also through specific and limited offers, giving the customer that feeling of exclusivity, without overlooking the economic advantage of lower prices.
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