Unbundled pricing also enables a retailer to match the price of low-cost retailers ..

[Chris Ryser]

Unbundled pricing also enables a retailer to match the price of low-cost retailers that do not provide ancillary services. It also charges customers for only those services that they desire.


A survey of 2,000 U.S. consumersconducted by Booz & Company suggests that only 9 percent of consumers intend to spend at pre-recession levels on household products, 10 percent oncellular phone service, 11 percent on health and beauty products, and 18 percent on apparel, clothing, and shoes as of 2011. Close to two-third ofconsumers (64 percent) stated that they’ll shop at a different store with lowerprices even if the store is less convenient.

Finally, a KantarRetail/PricewaterhouseCoopers report states that post-recession shopping will become more purposeful in nature. Rather than limiting purchases, the post-recession shopper will become more prone to seeking deals, being more opento comparison shopping, buying fewer items, shopping less often, and purchasing more private labels.

This report states that retailers that rely on Baby Boomers will be particularly hard hit due to their loss inwealth and the need to fund retirement.
In pursuing a low-cost strategy, retailers need to be careful that services that a retailer’s target market views as critical not be significantly reduced or eliminated. One way of reducing this risk is to use unbundled pricing. In this way, an applianceretailer can charge separate prices for an appliance, delivery, installation,and carting away of the old appliance. This unbundling strategy satisfies the needs of both the low-cost segment (which is willing to do some or all of the services) and full-service customer segments (which are looking to do none of these tasks).

Unbundled pricing also enables a retailer to match the priceof low-cost retailers that do not provide ancillary services. It also charges customers for only those services that they desire.

A retailer needs to becareful in formulating its differentiation strategy so that its new strategy is not based upon a niche. One way to effectively address a differentiation strategy is to use micromarketing, where stores are clustered into groupings based on their specialized markets. In this way, an appliance chain may offer compact appliances (such as 10-cubic-foot refrigerators) in its cent ral city stores, and 23-cubic-foot refrigerators, lawn mowers, and snow blowers in its suburban and rural store units. A supermarket can utilize micro marketing by offering six-packs of lamb chops for stores in family-oriented neighbourhoods and prepared single-serving portions for stores with a high proportion of single residents.

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Discussion.........................

[himmeroo]

So,What they're saying is,charge for adjustments,cases,PDs,measurments,lens insertions,cleaning glasses and trying on frames to keep the price down on the glasses and match the slock houses pricing.I think the strategy might work in an appliance store but not sure it would work in an optical.

[Barry Santini]

Unbundled optical pricing can deliver the lowest possible cost eyeglasses, which only a real free market can allow.

I say let all ammetropes have a vision *products* allowance covering a generic pair of eyeglasses, nothing fancy.

Tie the product cost to the lower of Zenni/Coastal pricing.

Any options, extra service, attention, fitting or other service needs should be paid a la carte, like an insurance co-pay, as the recipient desires/requires.

Then get rid of all eyeglass insurance plans.

End.

B

[tx11]

No need for a showroom. Frames must be viewed on line. Actually handling the frames costs money

[Chris Ryser]

So,What they're saying is,charge for adjustments,cases,PDs,measurments,lens insertions,cleaning glasses and trying on frames to keep the price down on the glasses and match the slock houses pricing.I think the strategy might work in an appliance store but not sure it would work in an optical.

I have never seen a post from anybody stating that it works or does not work in the optical retail. So we can assume there have been no test's done on it.

[optical24/7]

* The public likes to know "walk out price".
* It's easier to drop a price/benefit than to *add* to a price.
* Who wants to be first on their block in *a la carting* their prices and services?

I have a story (true) about #1; (pricing has been changed to protect the innocent) I had a patient call me checking on pricing of SV lenses. A quote of $75 was given. She told me she called a competitor and was quoted $50 and would need to go there for the savings. She came in the next day to order lenses. When she was finalizing the deal at the other location, they told her, "That will be $100". When she complained that they had quoted her $50 their reply was "Yes, $50 per lens". She (rightfully) felt misled.

#2; I have tried every presentation there is and I'm convinced it's better to quote a price with all recommended options for a given patient. Explain the benefits of each option that is included prior to giving the price. If it's more than they wish to spend you can ask them which benefit they wish to drop from the order. This is much easier than saying your lenses are this, the coating is this much more, do you want it? Thinner lenses are this much more, do you want this? And so on.

#3; If as an industry we don't all go a la carte, it will be tough to implement this kind of policy on an individual location basis. Once again, whom will step out with this concept 1st? ( I'm not talking about charging for services for products not purchased from you, those should have a fee.)

[Barry Santini]

Our conversational, comprehensional and fitting skills are par excellence. I'll gladly let a client "sample" the same.

But if you want it all, you'll need to buy the "bundle" from me.

B

[waynegilpin]

"When she complained that they had quoted her $50 their reply was 'Yes, $50 per lens'."

Ah yes, the white knuckle method of pricing. You say the glasses are $200. If their knuckles don't turn white, you add, "That's for the frame. The lenses are an additional $200." If their knuckles still haven't turned white, you say, "Each."

Read a book one time on soliciting for charities and they said that if the donor's knuckles don't turn white when you suggest a donation amount, you didn't ask for enough. They were serious.