Pricing Tricks from Online Retailers

The following opinion piece is not a chance for us to take the moral high ground, or to take some cheap shots at our competitors, but is more a challenge to other independent online wine retailers in Australia to think seriously about how they communicate with their customers over their pricing. I have not researched  the pricing practices of the Woolies (Dan Murphy’s, BWS, etc) & Coles (Vintage Cellars, Liquorland, etc) brands for this article – Not because I think they always operate in a fair way when it comes to competition, but because there are already 100’s of articles/blogs/discussions that are happening around big business swallowing up independents to push prices up long term..This is an ongoing debate but one that is already well-covered by others.

Tellingly, the ‘big boys’ aren’t even guilty of the following pricing practices which we will outline – they tend to be the domain of independent wine retailers, and often of  so-called ‘discount’ retailers who focus solely on shifting large volumes of cheap or discounted stock. I suspect the big boys don’t engage in these practices for one of two reasons (or both):

• They’re potentially illegal

• They’re bad business practice (over the long term)

Our view is that consumers shop with independent retailers because they feel they can trust them, and they offer good independent advice on wine that they can’t get elsewhere. Consumers today WANT to build one-on-one relationships with their suppliers – something that is very difficult to achieve when a customer can’t trust your pricing – which is the very beginning of any interaction with a new potential customer. Why a retailer would want to mislead customers they are trying to build long-term relationships with is beyond me!

We’re going to outline a number of different pricing practices which we feel lack some integrity and run a fine line between being legal and misleading. The first is perhaps the most widely used by independents in Australia – The RRP (Recommended Retail Price).

In the second article, we review the use of vague pricing terms.