The Good, The Bad & The Ugly (Online Sales)

[paradiziac]

IMHO, it's good to have so many ways to buy gear. In putting together a couple of systems over the past 12 months, I've bought fair few bits n' bobs via various sales channels. Thought it might be interesting to list them:

3 items - demoed in shop, bought from same shop (all budget gear--at reduced prices!)

3 items - ex-demo/lightly used items via flea Bay bought unheard (from retailers actually!), at a price I wouldn't lose too much if I didn't like it

3 items - older used gear from flea Bay

2 items - used gear bought from private individuals through (other) forums

1 item - bought direct from manufacturer/importer with 30 day home trial period

1 item - bought online from dealer (returned under DSR)

Most of the gear I bought was unheard, I don't think I would have been any happier or richer had I bought everything from High St bricks n mortar retailers. I sold a few things on and didn't lose much more than I would have in petrol/time driving around retailers. FWIW, I didn't buy anything online that I demoed in store.

The trad. hifi shop is, to my mind, like my local fruit 'n veg shop (or record shop) -- somewhere I instinctively feel I should patronize, but rarely do because of the reality of what's on offer, for what price and the inconvenience of getting there.

Just my personal story, no doubt everyone is different and that's why is good that the market is diverse and we have a choice.

 

[BenLaw]

Some excellent points have been made on this thread for both sides, although IMO Crocodile has come in for a bit of unfair stick.

While it is interesting to hear both sides on the broader debate, I don't think the OP put the case FOR internet / distance purchasing and AGAINST the local hifi shop, as has been made clear by Crocodile's later posts about buying certain gear online, certain in store and making lengthy trips where he considers it appropriate, to make a purchase in a real shop. (FWIW much the same as my purchasing history.)

To have a go at his OP rather ignores the contents of it. In each of the three situations described the company dealt with was either willing or indicated a willingness to conduct business long distance. It's each individual company's choice as to whether they do this. Certainly, there are hifi outlets (including successful ones) that do not have a website on which you can make purchases and which insist you go to the shop to collect items. If a company does make the choice to sell online / at distance then surely it is in the company's interest to do it properly? Better not to do it all than to do it badly.

In that context, it is all very well manufacturers and dealers complaining about the rules, but that's the market place and position yourself in it how you like to best make a profit. While the market is competitive and there are unfortunate casualties, even in these straightened times it clearly is possible to make a profit. As evidence of a company doing this, David @ Frank Harvey is concerned about the influence of Amazon but the company sells there. I don't say that as a criticism, it is just an example of choosing how to position the company in the marketplace.

So if each company chooses to sell in this way, surely it is legitimate for someone to say if a good job has been done or not? Superfi, good on you. SSAV, as frustrating as the rules are, those are the rules and they ought to be complied with. HiFi Corner, how can it ever be good business not to get back in touch with a potential customer?

 

[the record spot]

See, I *knew* this was an interesting conversation. How are retailers killing themselves , THCC?

I'll give you an example JD: a year or two back I contacted a London shop who had the Harman HK990 for £699. I emailed asking if they had a dem model could I buy and return if I didn't like it, as per the DSRs. They wrote back saying that they couldn't help. Their Returns policy was that refunds couldn't be given if the box had been opened. F*** 'em.

I'm with Nick and the OP on this one.

Incidentally, THCC had the HK on offer some months later and I took the demo model home. It turned out that it was too big and tonally too dry in my then setup. My money was refunded without a quibble. I bought my Tannoys from the HCC some time later and expect I'll go back again in time.

I don't have the time to muck about these days; my free time means I see the kids or have them at my place, my work is off the scale. Demos aren't going to happen these days, which is why I place high value on the DSRs.

 

[bigblue235]

Having worked in a branch of retail which has now largely disappeared due to the internet, I can sympathise with the retailers here. But I can also sympathise with the consumers as they're just trying to take advantage of what they legally should be entitled to do.

To me, the big issue to me is that the DSRs are slightly unfair on retailers. There should be a re-stocking fee allowed, IMO. When the DSRs were created, the intention was to protect the consumer from being stuck with a purchase that didn't live up to their expectations. Unfortunately, they were nigh-on impossible to create without leaving the system open to abuse, so now people with very little intention to buy can have endless home demos, costing retailers a small fortune. This, in turn, makes retailers less keen to take a risk on someone else who is, unknown to them, far more likely to buy.

Also, consumer expectations are a little unrealistic sometimes. People have no embarrassment when taking advantage of the facilities in a store, using it as a showroom, then walking away to buy on the net. Often this is because of their own theory similar to the one mentioned earlier "If they were within 10% of Amazon I'd buy there, providing they offered top service". Expecting a specialist high st retailer to get within 10% of the world's biggest box shifter is a bit unfair. Contrary to common belief, there isn't a set cost price for a product, so there isn't a 'going rate' for what it should sell for at retail. With the product I used to sell, Amazon could retail it cheaper than we could buy it in!

People claim retailers should adapt, offer incentives, change their strategy, etc. Most of the time these are good suggestions, but if they're that obvious to people outwith the trade, do you not think that they're really, really obvious to people in the trade? Of course they are. The reason such ideas aren't implemented is usually because they're unworkable. Price-matching is one that comes up a lot, but it's simply not feasible in many cases.

I can see why retailers sometimes get a little irritated in these threads, many of the suggestions made are maybe a little naive. Possibly even patronising. Customers know what they want, but there has to be a balance between what they want and what's achieveable. It's all well and good saying "If you do <whatever> I'll shop with you" but if they retailer can't make money that way, it's never going to happen.

 

[GK]

With the product I used to sell, Amazon could retail it cheaper than we could buy it in!

That is a manufacturers and distributors problem. Something wrong is there. Why that must become consumer problem?

And what about second hand sales? Should we complain about it too? If I by something second hand, a shop sell only one item instead of two.

 

[visionary]

With the product I used to sell, Amazon could retail it cheaper than we could buy it in!

That is a manufacturers and distributors problem. Something wrong is there. Why that must become consumer problem?

Because over time the consumer will lose out because they are not prepared to pay for 'service'. I'm in retail too, different field. Many of our customers are happy with what we offer and what we charge because they understand that my time and that of my staff has to be paid for. Others feel they want to pay the lowest price and then are surprised when we are reluctant to provide the 'after-sales' on a product we didn't sell unless they pay for our time!

Eventually there will be fewer real service providers and the consumer will be less well served. That's why it is a consumer issue. Take an extreme case... How much is a piece of paper? Compare it to the cost of a solicitor's letter on a piece of paper. See what I mean? You have to pay for expertise somewhere in the equation.

 

[GK]

So, for consumer it must be clear visible where is this extra value when he is going to shop. Is it aftersales service or before sales service, anything. Extra sevice - extra money. Probably before sales service because even online sellers must provide a warranty service. Somebody paying for that, probably manufacturers, so it is not so important for shops.

 

[WishTree]

Home Theatre Sound / HiFi industry is quite unique.

When I see a demo of a TV at a retailer, the chances of the same picture performance at my home are very high.

Where as with an audio equipment, irrespective of the demo at a retailer, the performance of the product might vary drastically at home (be it synergy with the rest of the system or home acoustics or some thing else)

So, there is nothing that comes close to that a Home Demo which automatically makes an online seller who honors DSR and sells at a competitive price as the first choice, for me. Ofcourse, the intention with which I buy is always to retain the purchase but not to find a reason to return.

Amazon worked out pretty good for me with their excellent DSR policy and with PRIME membership the products arrive the next morning!

In my experience, HiFi retailers are too much into judging the customer's potential purchase capacity. Most of the retailers forget the fact that an upgraditis bitten customer brings more business than a one time buyer. Me, for instance, increased my 500 Pound Home theatre spend to 10000 Pound Home theatre just in a span of three years.

On top of it the retailers, in my experience, try to wash their hands once the money is exchanged. (One time I paid full upfront for a Dynaudio Excite X36 which needs to be ordered by that retailer to the dealer. However, I could not live with my decision after 2 hours of payment and so I requested for a cancellation of the order immediately. The retaier refused to cancel my order and he placed the order next day and after one month delivered me the speakers) That retailer was dead to me henceforth.

It is not always all rosy with a retailer and there are other benefits that you get beyond retailers!

 

[GK]

With the product I used to sell, Amazon could retail it cheaper than we could buy it in!

That is a manufacturers and distributors problem. Something wrong is there. Why that must become consumer problem?

Because over time the consumer will lose out because they are not prepared to pay for 'service'. I'm in retail too, different field. Many of our customers are happy with what we offer and what we charge because they understand that my time and that of my staff has to be paid for. Others feel they want to pay the lowest price and then are surprised when we are reluctant to provide the 'after-sales' on a product we didn't sell unless they pay for our time!

Eventually there will be fewer real service providers and the consumer will be less well served. That's why it is a consumer issue. Take an extreme case... How much is a piece of paper? Compare it to the cost of a solicitor's letter on a piece of paper. See what I mean? You have to pay for expertise somewhere in the equation.

I guess, we can say something like - somebody ready to pay up-front, somebody not. There should be no problems if everybody knows how much is product and how much is service. And if product price already includes a some kind of service, it is a bit different product.

 

[Frank Harvey]

In that context, it is all very well manufacturers and dealers complaining about the rules, but that's the market place and position yourself in it how you like to best make a profit. While the market is competitive and there are unfortunate casualties, even in these straightened times it clearly is possible to make a profit. As evidence of a company doing this, David @ Frank Harvey is concerned about the influence of Amazon but the company sells there. I don't say that as a criticism, it is just an example of choosing how to position the company in the marketplace.

Always you eh?

Ive always said that a dealer who uses a third party website to sell from (eBay/Play/Amazon etc), theyre obviously not particulalry busy. Ever since this craze started, various manufacturers have disallowed their products to be sold in this way. But there is a growing number of dealers (dealers who have a large Internet presence) that are now selling a limited number of products on Amazon. The reason we sell no there is is that if we're not, someone else is. Compete, or die.

 

[CnoEvil]

This has been an interesting thread, with well put arguments on both sides.

Personally, I don't want to see a handful of companies get too much control, as I believe in the long run, this isn't good for the consumer.

I must be lucky with the 2 dealers that I use, as they have been so helpful over the years, that they have ensured my loyalty....I can see how a bad experience could easily slant ones' opinion, though (imo) a good dealer is well worth sniffing out.

 

[bigblue235]

I guess, we can say something like - somebody ready to pay up-front, somebody not. There should be no problems if everybody knows how much is product and how much is service. And if product price already includes a some kind of service, it is a bit different product.

Well... kinda. Any purchase you make at a shop includes all the related costs, so every purchase from a shop includes service. Every online purchase is the same, but with lower associated costs, so lower prices.

Does the service make the difference in price fair? That's up to the customer to decide, and no retailer worth their salt will have a problem with that. But where there is a problem is when the customer has unrealistic expectations which are unfair on the retailer. Such as taking up the retailers time with a demo THEN haggling on price and walking away.

I do believe that if retailers are going to trade online, they should abide by the DSRs. Them's the rules, so you should play by them. But at the same time, I think customers should only order if there's a genuine intent to buy. Too many people take advantage, without a thought for the cost to the retailer. With many of the items I sold, if them item was returned and had to be sold as 'open box' or whatever, we immediately lost all profit on that item. This is entirely fair if the customer was disappointed with the goods, and wouldn't have bought them in a shop if they'd had a demo, but entirely unfair if there was no thought of buying in the first place.

As an example of people abusing the legislation, look at bargain forums. If somewhere has stock of a desirable item first, but somewhere else is cheaper, some people will order it from both places, use the more expensive one until the cheaper one arrives, then return the more expensive one under DSR! Grrrr. That's the sort of 'Me vs the big bad retailer' attitude I hate. Some of us are/were good retailers!

 

[paradiziac]

For those retailers who have a problem with the DSR--they can factor this cost into the prices they offer online or choose not to sell online at all!

If there's widespread consumer abuse of DSR, we'll all end up back at High street shops because they're cheaper and offer a wider range of items

 

[TheHomeCinemaCentre]

Just to be clear I dont want anyones sympathy - I started in this industry fully aware of the pressures and problems I would encounter and am happy with my place within it.

As for retailers killing themselves - the internet (in this case online sales) is not an entity in itself. The big sites are run by retailers who have had the experience in store and decided to strip out service in favour of price. There are some who work from a bedroom, some from a shop and others from a warehouse but price is the USP. Specialist shops can offer to varying degress a little more than just a price but many do not realise it and feel compelled to compete with the internet pricing. This in turn leads to popular products becoming the main focus and that in turn pushes the price down. This is great for the consumer but dangerous ground for successful retail.

As an example the Pioneer SC-LX85 is a £2000 amplifier that is top of its class and may even have an award or two. Right now you can pick one up after a demo and with full shop service from established retailers for £1699 all across the country. In actual fact you could more than likely pick one up for a lot less - we lost a sale just yesterday because we wouldnt match a far lower price. Now this is all good for you and less good for me but this pricing came around as a bricks and mortar retailer wished to out price the competitiors to make some quick sales. This then lead to another matching the price and after a while the accepted price started to fall. It then settled to a lower price but Christmas came along and another well respected bricks and mortar retailer lowered the price to promote a sale. The internet had nothing to do with it - no dodgy Dave selling grey imports of b-stock just a good old fashioned retailer running their business.

This is just the visible online pricing - it is far more fierce offline. Think you are getting a good deal online - try picking up the phone, that is where the real business is done and to my mind where the real erosion of our industry comes from.

I have no real gripe with this as business is business and we just have to get on with it. What makes it a slight pain for me is that when the margin on a product is greatly reduced I really cannot keep the product in stock for a customer to take away after a demo. When it squeezes a bit more I choose not to have one on display and ultimatley I choose not to sell it. All still fine for you and not so fine for me. Thing is when this happens nationwide the apparent choice for the consumer is greatly reduced and that is not great for my main customer base- those who are looking to pay for good old fashioned service.

There are a great more issues at play here but the forum is never the place for an essay.

 

[Frank Harvey]

For those retailers who have a problem with the DSR--they can factor this cost into the prices they offer online or choose not to sell online at all!

You can't. Factor in anything extra which bumps up the price, and you get no sales. It's human nature to seek out the cheapest, that's the way it is nowadays, that's understandable.

And as for what Nick says, here's an example. A well known AV receiver that's £450 rrp being sold for a lot less than £300? Where's the incentive for retailer to keep it on demo?

 

[BenLaw]

Always you eh?

Er, well, no. Compare:

that's the market place and position yourself in it how you like to best make a profit . . . As evidence of a company doing this, David @ Frank Harvey is concerned about the influence of Amazon but the company sells there. I don't say that as a criticism, it is just an example of choosing how to position the company in the marketplace.

there is a growing number of dealers (dealers who have a large Internet presence) that are now selling a limited number of products on Amazon. The reason we sell no there is is that if we're not, someone else is. Compete, or die.

I don't think we said anything different did we?

 

[GK]

As just a regular consumer I do not understand from where comes that big discounts or price difference. There must be involved manufacturer. Or start price is too high? Or it is just big company old trick to deal with competition on own expense - dumping?

 

[BenLaw]

Just to be clear I dont want anyones sympathy - I started in this industry fully aware of the pressures and problems I would encounter and am happy with my place within it.

As for retailers killing themselves - the internet (in this case online sales) is not an entity in itself. The big sites are run by retailers who have had the experience in store and decided to strip out service in favour of price. There are some who work from a bedroom, some from a shop and others from a warehouse but price is the USP. Specialist shops can offer to varying degress a little more than just a price but many do not realise it and feel compelled to compete with the internet pricing. This in turn leads to popular products becoming the main focus and that in turn pushes the price down. This is great for the consumer but dangerous ground for successful retail.

As an example the Pioneer SC-LX85 is a £2000 amplifier that is top of its class and may even have an award or two. Right now you can pick one up after a demo and with full shop service from established retailers for £1699 all across the country. In actual fact you could more than likely pick one up for a lot less - we lost a sale just yesterday because we wouldnt match a far lower price. Now this is all good for you and less good for me but this pricing came around as a bricks and mortar retailer wished to out price the competitiors to make some quick sales. This then lead to another matching the price and after a while the accepted price started to fall. It then settled to a lower price but Christmas came along and another well respected bricks and mortar retailer lowered the price to promote a sale. The internet had nothing to do with it - no dodgy Dave selling grey imports of b-stock just a good old fashioned retailer running their business.

This is just the visible online pricing - it is far more fierce offline. Think you are getting a good deal online - try picking up the phone, that is where the real business is done and to my mind where the real erosion of our industry comes from.

I have no real gripe with this as business is business and we just have to get on with it. What makes it a slight pain for me is that when the margin on a product is greatly reduced I really cannot keep the product in stock for a customer to take away after a demo. When it squeezes a bit more I choose not to have one on display and ultimatley I choose not to sell it. All still fine for you and not so fine for me. Thing is when this happens nationwide the apparent choice for the consumer is greatly reduced and that is not great for my main customer base- those who are looking to pay for good old fashioned service.

There are a great more issues at play here but the forum is never the place for an essay.

Interesting post, thanks

 

[bigblue235]

For those retailers who have a problem with the DSR--they can factor this cost into the prices they offer online or choose not to sell online at all!

Same thing If you factor it into your prices you won't be cheap enough to sell anything! So you have to take the risk if you want to sell online.

If there's widespread consumer abuse of DSR, we'll all end up back at High street shops because they're cheaper and offer a wider range of items

There is widespread abuse of DSR, always has been. Same with shops with really easy-going return policies, people have always taken advantage. Comes with the territory to an extent, but at least in a shop you can try to work out if someone is genuine, you can usually see from the look on someone's face if they're at it! With DSR it's faceless, and too easy. But dodgy retailers who flout the rules have been about for just as long as dodgy customers.

 

[Frank Harvey]

that's the market place and position yourself in it how you like to best make a profit . . . As evidence of a company doing this, David @ Frank Harvey is concerned about the influence of Amazon but the company sells there. I don't say that as a criticism, it is just an example of choosing how to position the company in the marketplace.

HiFix sells on Amazon, for the reasons I've stated, and that is our online representation. I work in the store, which is Frank Harvey HiFi. I'm just making that clear for anyone who may get confused by what has been stated above, or misreads it. Anyone ringing HiFix, they won't get to speak to me (although, they can pass on the call).

Apologies if I've misread, so just clearing that up

 

[Anonymous]

The first post is a tad cavalier. I admit when it comes to electronics I first research: online reviews and forums. Then it's of to the shops to test then it's back online for the cheapest price. I don't feel guilty doing this. I work in retail and can barely afford some of my more extravagant purchases in the first place. It's like my no tipping in restaurants. You can hate me for it but I could eat at home and spend no money what so ever.

 

[moon]

8) Hey, Mr Pink don't tip

 

[John Duncan]

Ah but does he *die*...?

 

[SteveR750]

We've had this debate not so long ago, when I suggested hi fi retailing was stuck in the dark ages. The reality is that sucessful businesses listen to what people want and then figure out how to make money whilst doing it, not telling them they are morons. I am one (and now there appears to be two of us) that don't want to travel for miles taking up hours of time I dont have (work, family for a start) just to listen to one unit you are intersted in. In any case it's pointless demoing anything really expensive unless it's in your own home; otherwise you might as well just use the WHF buying guide as a shop demo as anything else IME, unless of course you're prepared to cart your own system around too.

EDIT, Nick I wasn't having a pop at you either! I just read your post, and makes a lot of sense. Retail is notoriously fickle, and pain in the ***e customers are randomly distributed everywhere. I guess the skill comes in filtering out nonsense, and reacting to a bigger trend that might have an impact on the business.

 

[professorhat]

Have enjoyed this thread - for such a "hot" topic, it's been relatively free of childish argument which is nice. For me though, this is the best post I've read:

People claim retailers should adapt, offer incentives, change their strategy, etc. Most of the time these are good suggestions, but if they're that obvious to people outwith the trade, do you not think that they're really, really obvious to people in the trade? Of course they are. The reason such ideas aren't implemented is usually because they're unworkable. Price-matching is one that comes up a lot, but it's simply not feasible in many cases.

I can see why retailers sometimes get a little irritated in these threads, many of the suggestions made are maybe a little naive. Possibly even patronising. Customers know what they want, but there has to be a balance between what they want and what's achieveable. It's all well and good saying "If you do <whatever> I'll shop with you" but if they retailer can't make money that way, it's never going to happen.

It's very easy for us as consumers to just say "well, why don't they just do such and such? I won't feel guilty that they fail cos they can't adapt" etc. Knowing a friend who used to have a shop that closed down, I know it's really not that simple to just come up with a winning strategy to attract people away from purchasing items cheaper off the internet (he sold guitars, so was basically privvy to exactly the same issues of people demoing them in store so they could then purchase them online cheaper than he could get them). There's no way he could beat price, so he did everything else he could to attract people in other ways - guess what, it wasn't enough. It comes down to the basic fact that it just might not be possible for your little local reatiler to provide everything that you want as a modern consumer i.e. excellent service, large stock of products for demo purposes and rock bottom prices.

As consumers, we do have a choice though. We can support that little shop, we can ignore it or we can abuse it. If you do the last option, well that's up to you, as long as you don't miss it too much when it's gone.