Tuesday, 30 September 2014

How to sell low price or how Lidl Surprises

"Why are you so cheap?" - 9 Lidl lessons

Tesco Ad. on page 23 of Sunday Times supplement of
 50 years of Sunday Times Business  28/09/14

UK Supermarkets Tesco, Sainsbury’s and Morrisons have all lost market share in the past year as the low prices offered by Aldi and fellow German chain Lidl have tempted customers away. 

Aldi has also attracted shoppers with smaller, uncomplicated stores based in neighbourhoods as opposed to out-of-town locations.

Aldi announced  a 65% increase in its UK profits yesterday. 

City analysts picking over the current difficulties at TESCO  refer to the likes of competitors Lidl and Aldi  with the short label of “ the discounters”. 

It is a convenient shorthand of course but it can be rather misleading as it implies that their success is solely down to cheap prices in recessionary times. 

What is so interesting from a Selling perspective is to examine how the discounters actually sell themselves.

 Professional Sellers must be able to either justify high prices or give good reasons for low prices.

 It is part of building trust with your customers.

You’d think that lower prices in themselves would be enough for people to beat a path to the discounters' doors yet they feel the need to communicate and explain why they are cheaper.

Well for starters they tend  not to use the 'cheap' word too much. Their descriptions veer towards being " different " because you can only really sell a difference.

So how are Lidl  - a lidl bit different ?

Before reading on try this exercise - close your eyes for a few seconds and think up 9 reasons why you think Lidl are different! Then proceed and see how Lidl describe themselves and how their customers describe them.

They list the following 9 differences in their "Lidl News" September 2014

Regular readers of this blog will recognise how Lidll use their Offer Analysis of Facts, Benefits and personalised benefits through the use of the words you ,you're, you'll and your.

1.      Shelf Stacking - '...this saves time and money that we can pass onto you'
2.      Chillers - '..We don't follow the crowd we think green'
3.      Keeping it simple -' ..We don't stock more than 7 types of a given product'
4.      Barcode printing on bulky items - ' ..they can be scanned from your trolley, and you don't have to pick them up'
5.      Checkouts - packing benches ' this helps keep the queues down when you're paying and means you don't have to rush to pack once you've gone through the till'
6.      Big brands at small prices- ' ..lots of your favourite big-name brands at prices that you'll love'
7.      Fresh fruit and veg - order only a day's stock at a time  ' so that you can be safe in the knowledge that your fruit and veg is always going to be at its freshest. Just like when you buy it form your local market' 
8.      Carrier Bags - we charge for bags better for the planet -  ' we offer a wide selection from lightweight to heavy duty freezer bags'
9.      Limited non-food special offers - ' Check our website for upcoming offer to be sure you don't miss out'

page 5 of Lidl News September 2014
Discounter customers aren't cheapskates nor prudent puritans but part of the social Lidl tribe.

Lidl even see their customers as a tribe member. They see them and refer to them as ‘Lidlers’. Through facebook and twitter they leverage the posts of 10 million fans across Europe. These are then quoted in prs=ess adverts, billboards and in-store signage. The power of reference is as old as selling. The best salespeople for Lidl are satisfied Lidlers. ( or Brand advocates is you prefer marketing speak)

Lidl still educate sell ( missionary selling lives on in another guise)

Where they feel it necessary they educate Lidlers for example with expertise through their master of wine Richard Bampfield and two other masters of wine with their handy rating buttons and wine grading keys.

Competitive Selling - Don't rubbish the competition let others do it for you.

If you must compare directly to you competition due it through independent review
Lidl communicate the awards they have won in the 2014 Grocer Own label awards – 18 golds, 14 silvers and 75 finalists which apparently is is more than Aldi, Morrisons, M and S Waitrose and the Co-op combined.

Promotions and Momentum to your story

The Lidl When it’s gone it’s gone (WIGIG) offerings come under the their heading of ‘Limited offers. These are trailed for over a fortnight.
29th  Sept: Adult Autumn Fashion, Office essentials and Hi-Tech Offers
2nd Oct -: Car and Travel Essentials
6th Oct : Sewing and Saving Energy
9th Oct: Ladies’ fashion, Health essentials, Baking

Whether your price is high or low you still need to sell the benefits of your offer. If you can get satisfied customers to do the selling for you as brand advocates all the better.

Whether you sell in the high price or low price segment the Lidl model has much to remind us of the fundamentals of professional selling. Good Selling

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