Category Archives: Retail Sales

‘Fair Go’ Discount story – my experience

Working in the bike industry over the past 3.5 years I have had to battle with the “half price’ “50% off” offers that have been rolling out of our nearest competitor on countless occasions.  Seeing the recent story on Fair Go has highlighted what we (in the store) have been discussing and planning for every weekend there is an advert in our local paper.

Watch the episode here (may be country restricted)

Are you really getting a half price bike?

Let me start with the fact that this is based only on my own experiences and there are no exact figures unless I do a direct comparison of pricing.

It was just yesterday I was going through the conversation with a customer about what bike would be right for them and their needs in cycling.  After finding out what I thought we could offer and discussing a couple of options I heard the all too common statement “I have been to ‘one of your competitors’ and they have offered me something that looks like this at half price”

“Oh cool” my reply “Do you know which bike and model it was?  Lets just check it out and make sure its the right bike you are after”

I then go through the explanation that I believe is correct.  Our competitor has a business model that works, I don’t believe its right, but it works.

I believe they put a bike on  the floor at inflated recommended retail pride ‘RRP’, maybe, for the ‘lawful’ period (although this I find hard to believe when I see bikes on at 50% off so soon after they have been released).  They then put a sticker on for 50% off.

Most of the bikes we go through that are 50% off are, on average, $50 – $150 cheaper than our RRP (on lower to middle range model bikes, say models under $2000)

Sometimes there is a deal that we just can’t beat or come close to because it really is an amazing deal.

Lets look at the bike online and compare it to our equivalent.

All whilst pulling out our floor iPad.   A quick search online and found the bike model the other store had offered.  This particular model that had been offered worked out to be one that was outside my averages but we had it on special as part of our Great Bike Sale so it worked out ok for me.

The bike they had offered was online for $1499.99 with a special of $750 offered in store and our bike had a price tag of $919.99.  ($580 difference in recommended retail)

As I said, a little outside my averages for this one but I believe our RRP is close to a realistic price for the bike and parts offered.   I then follow up with

What do you get for spending the extra on our bike?

  • A free 1D bike wit with every bike you purchase
  • A free 1 month service to check everything is running smoothly
  • Links to local cycling groups and communities.
  • Professional Shimano Certified mechanics in house for any future repairs
  • become part of the Avantiplus Team

Ok, this last one is a little corny but its true, I normally invite people buying their first road bike to join us for the Saturday bunch rides which are designed for all cycling abilities

Once the comparison was finished the customer felt better informed about the bikes she was looking at and her decision was coming from a knowledgeable perspective rather than price or perceived bargain.

Like myself, the rest of the team at work believe in a fair deal so this Fair Go episode has been great in highlighting something we have been battling for so long.  I didn’t even think about comparing the RRP between New Zealand and Australia which is such a simple idea but makes complete sense.

My approach with customers looking for a deal isn’t always a winner, in fact, I’m still not sure which way this lady will go because a bargain is hard to pass up, especially in New Zealand where 57% of shoppers would go with a bargain.

BUT, is it really as much of a bargain as you think AND what do you get by spending that little bit extra?