Tuesday, September 13, 2011

The Best Deals Aren't Online: The Future of Price Comparison Shopping

Mandeville Maxens telephone 
You'd think the rise of e-commerce would have resulted in a panacea for deal hounds where you could find the best available price via a simple search on Amazon or Google Shopping. However, in the past month I've come across no less than three situations where the best deal available wasn't discoverable online - even with exhaustive comparison shopping searches. The best deals I found, on identifiable name brand products in the $200- $400 MSRP range, were discovered by comparison shopping old school: Over the phone.

The products I searched for included a musical instrument, a pair of shoes, and a mattress. In each instance, after searching fruitlessly online and seemingly hitting a manufacturer-enforced minimum advertised price, I was able to quickly find a price over the phone which was significantly better from a reputable retailer. I share the information here not because I want to bore you with my purchases over the last month. But because I think it's an interesting comparison shopping technique that could save you time and money.

Further, because it feels like there's an opportunity for crowd-sourced price comparison innovation here. More on that in a moment.

An Electronic Hi-Hat

The first item I was in the market for was a replacement electronic hi-hat: a Yamaha RHH135. For an item like this it's likely I'd check Guitar Center or Musician's Friend. Amazon has it as well. The best price I could find from a trusted retailer: $399. To replace the entire drum set this came from costs only $799 so $399 for a replacement hi-hat is ridiculous.

If I branch out and search Google Shopping I find it for $200. Interesting - that's an improvement. But I don't want to buy it from the no-name retailers offering it for $200 because I don't have a relationship with them, shipping isn't free, and what if I need to return it? What are the terms? How much is it going to cost to ship? And what is their return policy?

I pick up the phone an call Guitar Center. Without much hassle at all they price match it at $200, knock 10% off because they're having a sale. They throw in free shipping too. $180 + tax is all I have to pay.

The item shows up a couple weeks later (it was on backorder). It turns out the hi-hat wasn't the problem at all so I need to return it. I take it over to my nearby Guitar Center for a full easy return.

A Pair of Ecco Shoes

I'm not much of a shoe hound, but I like a decent pair of shoes. Like one every couple years. I was looking for something that was dressy enough to wear to church or a nice dinner out yet comfortable enough to wear to work every day. After some shopping online (Amazon, Zappos, etc) I think I've found the perfect pair: The ECCO Men's Windsor Tie Oxford.

Amazon has them for $225, and searching all over the place (Zappos, Nordstorm, Endless, The Walking Company, Pipelime - you name it) I can't find them for much less than $220. Some used options pop up but I'm not willing to go there.

So off to the nearby shopping mall I go to try them on to make sure they're what I'm looking for. A trip to Nordstrom and the Ecco store confirm they are. But I can't find a deal on the shoes. I even nudge the salesman at the Ecco store - "Do these ever go on sale?". "No" is the response.

Hmm. At that point my options are to buck up and pay full retail and enjoy the benefits of local support (for returns and/or other random issues) or look further for a deal.

But I don't want to spend time trolling randomly around DSW, Marshalls, TJ Maxx an Nordstrom Rack. And I don't want to drive an hour down to the nearest outlet mall with an Ecco store only to discover they don't have the shoes I'm looking for.

So I call the nearest Ecco outlet store. The salesman is super-helpful and tells me they don't have the shoe I'm look for -but- gives me the number of 4 Ecco outlets in the country that have the exact shoe I'm looking for and gives me their phone numbers.

I call the first one and they have it for $179 with $7 shipping. Hmm - not bad. That's already better than any price I could find online. I call the next place and they have it for 25% off $179 so $134 plus $7 shipping.

As a side note I should mention I love free shipping as much as everyone else. But compared to the opportunity cost of a weekend spent driving around trying to track down shoes, not to mention the cost of gas, makes $7 shipping on an item at a great price look like a deal in itself.

So I go for the $141 fully loaded Ecco Windsors. They arrive 3 days later and are absolutely perfect. Just what I wanted.

Twin Mattress

Is there a more difficult to price compare commodity than mattresses? I don't think so. Manufacturers intentionally create private label variations of identical products to thwart comparison shopping and it's nearly impossible to compare the quality of a mattress on your own in a store.

We were looking for a mattress for our 4 year old's first big boy bed. For our 6 year old we bought an organic mattress that wound up lacking sufficient support and given that 4 year olds tend to have accidents - how long do I want this mattress to last?

Just long enough. And it needs to be comfortable enough for one of us to seek refuge in when he comes into our bed during the night and edges one of us out. So I'm looking for a good enough twin mattress.

Strange thing about mattresses is that twin-sized mattresses aren't much cheaper than king-sized. At least not at the low end. So although you think you're "just looking for a kids' mattress" you could be shopping for an expensive product.

I heard an ad on TV from a local furniture retailer (Bernie & Phyls) offering any sized mattress for $99/piece - so $198 for a mattress and boxspring. I really didn't want to go to Bernie & Phyls and experience the inevitable bait and switch. We checked Costco last time we were there ($299) and Ikea seemed to have some cheap mattresses (but again - lots of driving around to far flung places on the weekend). So on Friday night while we were waiting for our pizza to be delivered and planning our weekend I called 1-800-Mattress.

In about the same time it took to order a pizza I ordered a mattress.

The cheapest twin mattress with boxspring we could find on their website was $329. I mentioned a local furniture company was offering a mattress and boxspring set for for $199 and in 2 seconds he matches the price - including delivery and tax.

The mattress showed up the next day in perfect condition. When I saw the receipt I couldn't believe it. The mattress was $155, delivery was $35, and tax was $10. The total was $199 as promised. Amazing - especially since we didn't waste our weekend shopping and hustling around mattresses.

Conclusion

In each of these instances I was able to save hundreds of dollars by comparison shopping and price matching. Not by searching online - but by picking up the phone and calling.

For items costing $100 and up I think this is a significant savings and an effective approach - especially for easily identifiable brand name commodities. What was interesting to me was the interest brands evidently had in maintaining a minimum price for their products online. I can see where they'd want to keep their full-priced retailers happy by making it hard to discover better prices. But I was surprised how effective they were - and how easily I could find better prices with just a phone call or two.

What's Next?

As I was searching online - especially for the shoes - I thought it would be useful to have a crowd sourced price comparison shopping platform to enable consumers to share and discover the true best available prices for goods.

All of the currently available apps/platforms I've found in this space seemed to be beholden to the retailers and brands who listed their goods for sale which in turn results in the same problems as we see with Google Shopping - that authorized retailers aren't allowed to (or don't for whatever reason) advertise prices lower than a certain minimum.

For situations like this - where the best deals aren't visible online currently - I sense an opportunity for disruptive innovation. Start with a repository of uniquely identifiable goods with price comparison facilities (like Amazon's) and link it up with venues (like FourSquare) where users can easily post 140 character (like Twitter) price comparison points and photos alerting other shoppers about values they've discovered. Allow other users to leave comments on deals for crowd sourced feedback.

Question of the Day: What do you think? Have you used similar techniques to get the best prices on brand named commodities? What other techniques have worked well for you?

4 comments:

Glaire said...

For $199, these beds are truly a bargain! Is the sale still on?

Therese said...

Indeed, a comfortable bed need not to be expensive. I used to have problems getting sleep before. My doctor advised me to get a more comfortable bed, which I got for less than 100 bucks.

Allaine Dumont said...

I like those new aero-reclined beds that have padded bed headboards that can be tilted so you can rest your back on. Very comfy when watching TV.

Anonymous said...

thank you for this
The Commodity Robot

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