Cheap vs. Cheap Chic

Consider this an op/ed piece on the nature of value.

Let's be honest. All of us like to get stuff cheap. This is true no matter how discerning the customer is, and in fact, the most discerning customer loves to separate the wheat from the chaff while paying chaff prices. Wal-mart is cheap. So is Target. In the world of marketing there will always be the low price leader. Wal-mart is it in retail, but they will never be cool. If you are the low price leader, you better be selling a lot of inventory because your margins will always be thin. Target is cheap and cool. If you are cheap chic like Target or Costco, you can offer low prices without destroying your margins. You can gain a reputation for pre-sorting the wheat from the chaff. This pre-sorting allows you to become a trusted customer advocate. Forget branding and concentrate on this one idea.

As we enter the new year, think about where you want to be. The lowest price, as a market position, is easier and easier to verify via the Internet. Comparison shopping sites abound. Today's lowest price is tomorrow's has-been. Times are tough but nobody wants chaff. Give consumers a break, give them some credit. Be the real thing. Then you can give the lady what she really wants: a touch of beauty at a price she knows is good–a bargain but not one that breaks your bank.

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