You’ve heard of name-your-own price travel booking site Priceline, right? And you’ve certainly heard tales of fashion customers asking for discounts at the retail counter (if you haven’t experienced it yourself), not to mention online marketplace eBay where shoppers can make an offer to the initial price “ask”.
So has retailing morphed into the lowest form of street bazaar haggling? Not exactly, but, like it or not, e-tailers are going to larger extremes to keep customers from clicking off the site.
Accessories chatted with the co-founder of PriceWaiter, who explained that growing the conversion rate–whereby browsing customers are converted into paying customers–is critical. “My partner had founded smartfurniture.com and then we ran an agency and we realized that it was more important to focus on conversion rates than just driving additional traffic to the site,” says Andrew Scarbrough, co-founder and COO of PriceWaiter. “And price was often the issue of why customers left a site.”
E-commerce negotiating tool PriceWaiter is a leading e-commerce negotiating tool that customizes consumer campaigns to include price match, make an offer, and volume discount. Retailers have the power to make more than one offer. Shoppers have the power to get the deal they want.
“The psychology of it all is something that really interests us. The feeling of the win,” says Scarbrough. “We’ve seen people negotiate on $2 watch batteries to save a quarter. It’s the emotional endeavor to get that win, and it really translates into repeat, loyal customers. People say they’re in control over the retailer, but actually the retailer is in control of the whole game.”
Pop-up windows help with the conversion rate, explains Scarbrough, who notes that the pop up will say “Leaving already? Time to make an offer!” when a customer tries to leave the site. And that’s when the game can begin.
Retailers can also segment the site, allowing offer opportunities as they see fit. For example, one jewelry/watch retailer only offers “Make an Offer” on pre-owned watches, not its new ones.
PriceWaiter differs from a Priceline, for example, is that it’s a functionality on a retailer’s own site, so the branding remains intact.
“As former retailers, that’s our mindset, but the popularity of it with jewelry and apparel has surprised us,” admitted Scarbrough. “We tell people to test it. Does it add incremental revenue? We found that PriceWaiter can add up to 35% of incremental revenue to the site.”
Retailers have the option to automate counteroffers, instantly rejecting or accepting offers as they pre-determine. OR, they can opt to weigh each offer independently, responding as they choose over a longer period of time.
Accessories retailer Savvy Watch opts for the latter. “We’re a third generation jewelry retailer and we launched Savvy Watch in its current version in 2013, teaming up with PriceWaiter at the same time,” says CEO Ryan Wilson. “We do Make an Offer on every product, as that functionality is the part of our shopping experience.”
Savvy Watch notes that the offers usually amount to about a 10% discount and in a way it functions as a price-matching tool of prices seen on other sites. “Customers would call us from the Contact Us number and ask for a matching price or a discount, or they would just leave the site and we’d never get the chance to try to convert them,” says Wilson. Many customers still buy at full price, however, as they don’t want to wait the 24 hours for the company to receive, review and respond to the offer.
“We found this service has helped with repeat customers–especially those who have had success–and it’s improved our retention rate overall.”