Monday, 8 October, 2007
Two experiences that make me wonder about discounts, sales and ethics. The first was just after an electronics megastore opened in north Mumbai. The objective to drive all the way there was to look see at this wonderland of gizmos and appliances and of course decide which washing machine to buy.
We reached there, started looking at the machines. The criteria being price, price and price, besides other important things like colour, looks, features, economy mode, water saver facilities, power consumption, dimensions, weight of clothes that could be washed in one go and so on. The gleaming washing machines were all lined up in a double row. Soon, my wife got really exasperated because of the seemingly endless questions that I was firing away.
The assistant, who was only fulfilling his promise to 'help us buy', got flustered the moment I got into even a slight technicality. I will ask my supervisor was all he could chirp-up every time. After twenty minutes, we were wondering what he was doing there in the first place if he didn't know his products. Other people I know have had the same experience with sales assistants in this chain of e-stores.
The supervisor duly arrived. I asked him the question, (price vs machine features) to which he replied very matter of factly that the tent cards on the few machines which said BEST BUY were actually for sale to the manufacturers and had nothing to do with recommendations or expert opinion of the store. The supervisor informed us that the particular model was about to be phased out so the manufacturer was keen to push it off the shelf faster. And so even though it was not the BEST BUY in terms of features, capacity and price, the Tent card proudly proclaimed it as one for all the gullible people streaming in.
We were shocked.
We would have trusted the store blindly because it comes from a well-renowned diversified conglomerate that is known for its honesty. We dropped into our local mini-electronics store in the neighbourhood and the price of the machine that we had liked was the same as the price in the big mega-store. In all probability he would have given us a further discount if asked.
The next incident is at a mega sale at one of India's first destinations for Shoppers. So last month we zoomed again to that northern suburb and went to the Home section. We spotted just the right soap dispenser and picked it up. It was atrociously priced at Rs 495 less 20% discount. Casually turning it over, I chanced upon the label of the same store, which said "Imported from some Chinese company and the MRP Rs 425". I asked the floor supervisor about this discrepancy where both labels were their own, while the price on top was much higher than the MRP labeled below. He said it was a stickering mistake. I said it can't be. Your own label below says it is at a lesser MRP. Is this mark-up deliberate to fool us into buying products at a 'Sale'?, I asked him. He got upset and said we have our margins to make sir. If you want, you can choose the lower price and opt for a 20% discount.
Shocking. We bought the said dispenser anyway for Rs425 less 20% discount. He quickly ordered his assistants to remove the stickering below. When questioned, he said that since I had brought this to his notice I can have the product at the lesser price. But he can't afford to give it to other people in the store.
Last week after the sale was over, I went to the Bandra branch of this Shoppers destination, and while browsing, chanced upon the same soap dispenser. Well, to my surprise the stickers above and below told the same story - Rs 425! So what was that Rs 495 price all about? A genuine mistake? Or is this how stores make money by marking up prices first and then offering discounts? It will always remain a great mystery.