Britain is a trading nation and any attempt at protectionism would backfire on us. If we stop imports, other countries will block our exports. As citizens, we would pay more and earn less. Look what happened in the sixties and seventies when trades unions sought to protect British jobs by preventing industries from modernising. We lost our competitive advantage.
Let’s continue to import mass manufactured goods cheaply and export specialised products and services for high prices. At Your Life Your Style, we stock many British made goods because they are beautifully designed and skilfully made, far better than their equivalent from overseas. Most of the other items that are made abroad more cheaply than thye could be in this country are still designed in the UK.
Free trade means we survive on our ability to be creative and competitive, something we as a nation are very good at.
Thursday, June 25, 2009
Wednesday, June 24, 2009
Mary Queen Of Empty Shops
Mary Portas looked at empty high streets on last night's TV. Fortunately Winchester where our shop is located is so far unaffected by the recession, although some premises in The Brooks are proving hard to fill.
Her answer to the high street woes after an hour of waffle? Work with neighbouring retailers, give the customers what they want and do it with a bit of razamataz. Good advice but did it need an hour to come to that conclusion?
Her answer to the high street woes after an hour of waffle? Work with neighbouring retailers, give the customers what they want and do it with a bit of razamataz. Good advice but did it need an hour to come to that conclusion?
Friday, June 19, 2009
My Loss Was My Copywriting Gain
I'd just written an email for Your Life Your Style customers. I went to the loo and when I got back, someone had inadvertently logged into the website administration and my email was lost. I wrote it once more and clicked to send a test email. The website software froze and again I lost it.
Strangely I was not dishearetned or frustrated by this. Because you should re-write and re-write and re-write again. And ideally you should not refer to what you already wrote.
When you've gone through the process of writing copy a few times, the ideas are firmly lodged in your brain, so you don't have to think about what you're saying. You become one with the copy, grasshopper.
What comes out of your head when you re-write on a blank screen is sharper, leaner and more natural.
Strangely I was not dishearetned or frustrated by this. Because you should re-write and re-write and re-write again. And ideally you should not refer to what you already wrote.
When you've gone through the process of writing copy a few times, the ideas are firmly lodged in your brain, so you don't have to think about what you're saying. You become one with the copy, grasshopper.
What comes out of your head when you re-write on a blank screen is sharper, leaner and more natural.
Saturday, June 13, 2009
The Price Is Right
I love, actually I need to start the working day with a coffee. To be precise, a latte from Costa. And every day I can’t believe I’m paying £2 for a takeaway coffee. How did the coffee houses persuade us to pay such an outrageous price which appears to bear no relation to cost?
To be fair, when we price products for our gift shop Your Life Your Style, it’s not as simple as taking the cost and applying a standard percentage mark up. There are a number of factors we take into account. As I always tell businesses who consult me, you first must consider the market and set a price appropriate to it.
As retailers, we have little say over the product’s position in the market, so we move straight on to how many we expect to sell and how much customers are willing to pay. At Your Life Your Style, we rarely expect to sell products on a mass scale because we offer special gifts and accessories.
However, if we can sell a reasonable number, we can afford a lower margin and make the profit we need through scale. Going back to my old theatre marketing days, I think of the example of Christmas pantomime where the type of audience and the numbers who attend allow for lower prices than for, say, a musical.
On the other hand, if the market is more niche, it is necessary to charge more. Opera comes to mind as a case where, at least when I was trying to sell it, no matter how cheap you made the tickets, there were only so many people interested in buying. At Your Life Your Style, we may go for a higher than average profit margin if we know a product is unique and may take some time to shift.
Of course, how people themselves value the product will have a big influence. And this is where it gets more complicated. Marketing, word-of-mouth and the intrinsic qualities of the product will potentially affect a consumer’s attitude to a product. They may have an emotional attachment to it or make a rational decision about its quality or simply want to show off that they have the taste or money to purchase it. Whatever the reason, if a customer believes the product to be exceptional or life enhancing, they will pay a premium for it.
This is why we don’t automatically charge the lowest price we can afford based on cost. A cheap price means to many people an inferior product because that is what they’ve learned from experience. No doubt Chanel could charge less but their customers want to buy an expensive perfume. In fact, perfume manufacturers and other fashion brands like Levi have fought hard to stop their products being discounted and thereby ‘cheapened’.
Back to coffee (and I am beginning to feel like another latte), Starbucks managed to persuade us that we were getting something special. Special beans, specially roasted, freshly ground, customised to your taste and in a social club atmosphere. Hence the special price. Then everybody started imitating it but the strange thing is, the more popular premium coffee became, the more the price should have come down. Yet it didn’t.
Initially Costa and the rest wanted to show they were the same quality as Starbucks, so they matched the prices. Even so, in all the years since, no-one has broken ranks and reduced prices. I read that at a blind tasting people preferred McDonalds coffee to Starbucks but it will take some persuading people that you don’t always get what you pay for.
Knowing the price people will pay forces Your Life Your Style reluctantly to turn down some excellent products where the cost is too high, taking into account all our overheads. For example, we have found that some (not all) products hand crafted in Britain are so expensive to produce that the retail price looks hugely expensive when compared with either something handcrafted in the third world or something mass produced. Every product must earn the time and space it takes up.
There is always an element of trial and error in pricing. We know there is a tipping point at which a product sells, so it’s easier to start with a higher price first and, if the product doesn’t sell, lower it. This then gives us the opportunity to employ the other great pricing tool- the bargain. Some more cynical businesses deliberately charge a high price to establish that something has a value, not expecting the product to sell, then cut the price. This way, people don’t see it as ‘cheap’ but rather a ‘bargain’.
We prefer to price fairly from the start, because we know that customers have no respect for cynical businesses. Their spend with a gift-cum-lifestyle shop like ours is entirely discretionary so we need their respect. To me, getting the price right is a constantly challenging element of running a business. There is no easy formula but if you get it wrong, all your other good work goes out the window.
To be fair, when we price products for our gift shop Your Life Your Style, it’s not as simple as taking the cost and applying a standard percentage mark up. There are a number of factors we take into account. As I always tell businesses who consult me, you first must consider the market and set a price appropriate to it.
As retailers, we have little say over the product’s position in the market, so we move straight on to how many we expect to sell and how much customers are willing to pay. At Your Life Your Style, we rarely expect to sell products on a mass scale because we offer special gifts and accessories.
However, if we can sell a reasonable number, we can afford a lower margin and make the profit we need through scale. Going back to my old theatre marketing days, I think of the example of Christmas pantomime where the type of audience and the numbers who attend allow for lower prices than for, say, a musical.
On the other hand, if the market is more niche, it is necessary to charge more. Opera comes to mind as a case where, at least when I was trying to sell it, no matter how cheap you made the tickets, there were only so many people interested in buying. At Your Life Your Style, we may go for a higher than average profit margin if we know a product is unique and may take some time to shift.
Of course, how people themselves value the product will have a big influence. And this is where it gets more complicated. Marketing, word-of-mouth and the intrinsic qualities of the product will potentially affect a consumer’s attitude to a product. They may have an emotional attachment to it or make a rational decision about its quality or simply want to show off that they have the taste or money to purchase it. Whatever the reason, if a customer believes the product to be exceptional or life enhancing, they will pay a premium for it.
This is why we don’t automatically charge the lowest price we can afford based on cost. A cheap price means to many people an inferior product because that is what they’ve learned from experience. No doubt Chanel could charge less but their customers want to buy an expensive perfume. In fact, perfume manufacturers and other fashion brands like Levi have fought hard to stop their products being discounted and thereby ‘cheapened’.
Back to coffee (and I am beginning to feel like another latte), Starbucks managed to persuade us that we were getting something special. Special beans, specially roasted, freshly ground, customised to your taste and in a social club atmosphere. Hence the special price. Then everybody started imitating it but the strange thing is, the more popular premium coffee became, the more the price should have come down. Yet it didn’t.
Initially Costa and the rest wanted to show they were the same quality as Starbucks, so they matched the prices. Even so, in all the years since, no-one has broken ranks and reduced prices. I read that at a blind tasting people preferred McDonalds coffee to Starbucks but it will take some persuading people that you don’t always get what you pay for.
Knowing the price people will pay forces Your Life Your Style reluctantly to turn down some excellent products where the cost is too high, taking into account all our overheads. For example, we have found that some (not all) products hand crafted in Britain are so expensive to produce that the retail price looks hugely expensive when compared with either something handcrafted in the third world or something mass produced. Every product must earn the time and space it takes up.
There is always an element of trial and error in pricing. We know there is a tipping point at which a product sells, so it’s easier to start with a higher price first and, if the product doesn’t sell, lower it. This then gives us the opportunity to employ the other great pricing tool- the bargain. Some more cynical businesses deliberately charge a high price to establish that something has a value, not expecting the product to sell, then cut the price. This way, people don’t see it as ‘cheap’ but rather a ‘bargain’.
We prefer to price fairly from the start, because we know that customers have no respect for cynical businesses. Their spend with a gift-cum-lifestyle shop like ours is entirely discretionary so we need their respect. To me, getting the price right is a constantly challenging element of running a business. There is no easy formula but if you get it wrong, all your other good work goes out the window.
Monday, June 08, 2009
Can You Have Partial Democracy?
It's our democratic right to choose whichever party we think has the best policy on the economy or public services or even immigration, but how can any person who believes in democracy vote to be governed by a party that will only accept white members?
Tuesday, June 02, 2009
Blue Islands Airline Soars Above Flybe
Back from our first visit to Guernsey and very impressed by the Blue Islands airline service.
They are a small channel islands business and, as opposed to their competition Flybe, very customer friendly. You can amend or cancel your booking up to one hour before- at no charge; there's no charge for your hold luggage; there's no charge for use of their lounge at Guernsey airport.
I'll definitely return to Guernsey, a great place for a long weekend break- and I know who I'll be travelling with.
They are a small channel islands business and, as opposed to their competition Flybe, very customer friendly. You can amend or cancel your booking up to one hour before- at no charge; there's no charge for your hold luggage; there's no charge for use of their lounge at Guernsey airport.
I'll definitely return to Guernsey, a great place for a long weekend break- and I know who I'll be travelling with.
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