"Counter-Productive" Day

We've just lived through "Black Friday," "Cyber-Monday," "Thanksgiving Day Specials, " etc. As retailers begin their sales earlier and earlier, I see a death-spiral forming. 

Yes, I understand that a great percentage of retail revenue is generated during this next four to six weeks. But I am adamantly opposed to fighting this battle based on price.  

On the positive side of the ledger is revenue clawed away from the competition. On the negative side of the ledger are:

--Consumer stress and confusion.

--Substantially reduced profit margins based on lower prices and higher operating and advertising costs.

--Strong reinforcement of the "wait for the sale" consumer mentality.  

--Degradation of perceived value. ("If you can discount the product 50% today, then you are obviously grossly over-pricing it during the rest of the year.")

--Sympathy for employees forced to work ridiculous hours and holidays (which translates into negative publicity for the employers).  

The answer? It's straight out of Marketing 101.

--Steer away from commodity items and services.

--Develop a reputation for service or quality.

--Price your product competitively throughout the year.

If a disproportionate percentage of sales come from the holiday period, then the answer is not to kill your profitability trying to ride that trend; the answer is to change the trend!    

"Kobayashi Maru" is a phrase familiar to Star Trek fans.  It describes an impossible-to-win Starfleet Academy  test.  In the show, future captain James T. Kirk beats the system by re-programming the rules.   

As long as companies buy into the assumption that they must have "X" share of the holiday sales, they will continue to move up the start of their sales and to discount their products more deeply. It's time for a "Kobayashi Maru" solution, before the death-spiral becomes irreversible.