CUSTOMER BARGAINING

Hot Topic
YOUR NEW REALITY: CUSTOMER BARGAINING

Consumer price negotiating is on the rise at retailers across the country. Find out why—and how to handle this big issue in your own business

BY ERINN MORGAN

do you have customers who try to haggle or negotiate with you on price while in the optical shop?

If so, you’re not alone. Some eyecare professionals say this consumer-driven act is on the rise in optical shops across the country.

“Yes, we’ve had more haggling. However, we decided to run special events on frames and lenses instead that will allow the consumer to buy the product in a professional manner without degrading it,” says Edward Beiner, owner of the South Florida-based, 11-store Edward Beiner optical shops.

The issue is much bigger than the optical market, however, and experts say that this new consumer behavior may be here to stay.

“This has been a long time coming and, while I still believe strongly in the customer experience in-store, people do shop online and compare prices. Thus, haggling isn’t just a trend—it’s here to stay,” says Scott Deming, an author, speaker, and branding and customer service expert who also conducts the popular Chief eXperience Officer program at the Vision Expos. “With the rise of online retailing, brick-and-mortar retailers with big rents are scared; so they’re feeling like they have to negotiate with the customer.”

In fact, a study conducted by CNW Research found that car buyers are haggling over new car prices more than at any point in recent history—more than 44 percent of all new car buyers negotiate their price against the dealer’s initial offer.

Deming points out that certain retail industries, such as the automotive and online-beleaguered book retailers, are much more willing to negotiate in-store than others. “I don’t think you’re going to see price negotiating become [such] a major issue in medical fields like optical,” he notes.

A GROWING CONCERN

Still, some ECPs say that price negotiating is becoming a new reality in the optical market. According to Zaf Khalfan, owner of Delta Optical in Toronto, about 15 to 20 percent of customers try to negotiate on the price of their eyewear.

“I witness people asking for a discount quite often in practically every optical store that I visit in New York, Chicago, Los Angeles, and San Francisco,” adds David Cutler, a frame representative for Barton Perreira. “It seems to be the way of the world now to ask.”

Why is haggling on the rise at retail? One reason is that technology-armed consumers are using sophisticated price-tracking tools on their smartphones to price shop.

“I believe that when one has access to compare pricing, then it certainly feels okay to ask for a reduction or to price match,” says Khalfan.

“This is a problem for products that are more common, labels, brand names, etcetera,” he adds. “Because we do not carry any labels or more common brands, we don’t face the difficulty other retailers may see as much.”

In addition, today’s consumers know that retailers are all angling for their business, so they’ve become more forward in working a deal for themselves on the retail sales floor. Optical retailers are also faced with a market where managed care has made frame discounting the norm.

“I think there are many issues that have caused customer bargaining to increase,” says Beiner. “Smartphones have had an effect, especially on sunglasses. But eyecare insurance has created challenges, too, by allowing many products to be discounted 30 to 40 percent. I think Internet shopping has also had a significant effect, as current prestige products can sometimes be found on there, too.”

Handling Haggling

How can ECPs best approach customer bargaining efforts that may take place in their optical shops? Here are four ways optical retailers are approaching the problem.

Some ECPs have made a no-haggling policy loud and clear in their stores. “A very small amount of our customers try to negotiate on price,” says Alissa Fields, owner of Eye Spy Optical in Chicago. “People understand that we are a small, locally owned business.” Some optical retailers, such as Zaf Khalfan, owner of Delta Optical in Toronto, do offer discounts for certain specific circumstances. “We will give a discount to customers who buy multiple pairs,” he says. Still, most ECPs say they keep the process of customer discounts and price negotiations discreet.

At Eye Spy Optical, Fields also offers discounts, but only to frequent, returning customers. “We explain that to potential customers when they ask for a discount,” she says, adding, “We also explain that everything in the store is handmade and that we have pricing guidelines from the vendors that we have to follow.”

Instead of focusing on price, Khalfan says he puts the focus on his high-quality products and service. “We strive to give the best service one can get for customers who buy from us, so we politely let those who inquire know that we do not discount,” he says.

Edward Beiner, owner of the South Florida-based 11-store Edward Beiner optical shops, also trains employees to show the value of the products they sell. “But, if necessary, we will match prices and reevaluate the product that was sold,” he says. “Our employees are continually trained to feel proud of what they are presenting and selling.”

When it comes to haggling, Khalfan says there are two kinds of shoppers: “There is one who really wants to buy from you as he or she appreciates the personal touch one gets with service and attention; then there are those who want to use your store as a showcase to try frames, get your advice, take pictures of themselves wearing the frames, and then buy elsewhere,” he says. “I do see the latter on the rise and we, in return, do not allow customers to take pictures.”

In addition, during the selling process, Khalfan continues to explain that an optical store is more than just a retail store and the product that they buy will require attention and servicing.

Some ECPs have instituted in-store sales as an answer for customers looking for a discount. “We have a sale once a year in January when you can get a discount on a large selection of frames,” says Fields. For some eyecare professionals, however, sales are not a boon for business. “After many requests from our managers of our other stores, we decided to hold a sale across all our stores,” says Khalfan. “My business during that period dropped 25 percent as most of our regulars said that they would instead come back after the sale was over. That was our first sale in 20 years.”

Thus, the key with planning a sale is to know if your clientele will truly benefit from it.

Interestingly, some eyecare professionals say that price negotiating has been a part of the business for many years. “I work for a lab now, but I owned stores from 1980 to 1995,” says Dave Metzger, a lab representative with US Optical Wholesale Lab in East Syracuse, NY. “My store in Jersey City, NJ, was a hotbed of negotiation, mostly because I was a one-man shop and my clientele came from cultures where negotiation was part of their daily life.”

SHOULD YOU HAGGLE?

To address the growing incidence of in-store haggling, some ECPs are employing unique strategies and tactics to get a handle on—and put a damper on—haggling. The same goes for both big and small retailers and chains that are outside the optical market.

“The economy is bad and people are used to price searching on the Internet,” says Alissa Fields, owner of Eye Spy Optical in Chicago. “We’ve had a number of people email us to ask about pricing to see if the price they were quoted locally is the same or more at our shop—and they ask for a discount. The answer is always ‘No’ from us, but I’m sure other places say ‘Yes’ to make the sale.”

Deming advises that retailers greatly limit their price negotiations—and even consider banning them. “I’d suggest not going there because of the type of store you operate,” he says. “Once you start doing it, you’re potentially setting yourself up for some pretty unappealing consumer and marketplace perceptions. If you want to have a sale every now and then as an alternative, that’s a good option.”

Instead of bargaining, he suggests training employees to show customers the value in what you offer, including excellent knowledge and customer service.

“If someone comes in and wants to negotiate and walks out because you said “No,” then know that you do not want him or her as a customer to begin with. That customer will never ever become a loyal shopper anyway—price shoppers always move on for a better deal.”

5 Top Price-Tracking Tools

What are your customers using to play the field—and shop for the best price—while they’re standing in your store? Here are five of the most popular price-tracking tools used today.

No. 1
DEALSCIENCE.COM:
a website that enables visitors to find the best deals, discounts, and coupons

No. 2
REDLASER:
a smartphone app that targets deals by comparing prices and coupon offers

No. 3
AMAZON PRICE CHECK:
a smartphone app that allows users to scan barcodes or shoot photos of products and then look up the price for which Amazon sells the same product

No. 4
THE FIND:
this app allows smartphone users to scan barcodes to locate deals within their specific geographic location and online

No. 5
GREENTOE.COM:
allows visitors to shop for products they want and then make a bid with the price they want to pay