Selling on Price

Everybody loves a good deal. Sometimes this means a great product at a good price. Other times it means a good product at a great price. I have learned over the years to prefer the former rather than the latter, but that's a topic for another article.

This is about selling yourself on price. I hear so many performers lamenting the new guy who "undercuts" them. No one can undercut you unless you are the low-price leader. And if you are the low price leader, then you INVITE undercutting.

Take for example, how excited I was when the "$1.00 Bazaar" opened near my house. Any magician will tell you it is a great place to go to find inspiration. The dollar store inventory constantly changes because they purchase their stuff from people who couldn't sell it in a normal store. This is usually because it is of poor quality, flawed design, or of very dubious value, but again, I'm getting side tracked.

So I shop there and am pleased with the fact that the junk I’m buying never costs more than $1.00. This is a very good thing, because generally it is not worth any more than a dollar and sometimes I think I get ripped off.

So you can imagine how elated I was when a new store opened up across the street with a big sign advertising "Nothing over 99¢".

YEE-HAWW!

And they claim the best selection of low quality merchandise in all of Texas. Yes, that's a mighty big claim because there is a LOT of low-quality merchandise here in the largest state in the continental United States.

"Giant 99¢" didn't fail to deliver on their promise of a great selection of unsellable refuse. On my first visit I was awed by the incredible selection of wall-to-wall junk and not a single thing was priced (or worth) a single penny over 99¢.

Now, I'm sure you're wondering, "How in the world could things in Texas possibly get any better for the bargain hunters?" But some of you already know the answer….

Yes, that's right, we got our very own "Mr. 98¢" store! The grand opening was spectacular! They had day-old donuts, tofu hot-dogs on stale buns, and one of the least expensive entertainers in the city. He wasn't there when I arrived 20 minutes after his show was supposed to start. And he still hadn't arrived when I left 45 minutes later, but the store manager held pretty high hopes that he would eventually show up. You know, provided he wasn't involved in another DUI or something.

So I drove home with a smile on my face that nothing could shake. I found a new resource for invaluable merchandise (actually it's really more "unvaluable" merchandise, but my spell checker won't let me use that word).

Then it hit me as I was driving in the warm glow of satisfaction (or was it the warm glow of the faulty chemical glow sticks I got twelve for 98 cents that had leaked all over the backseat?). Regardless, I realized this was much more than an amazing retail phenomenon; this was much more than a resource for discontinued and recalled items at below cost; this was a business model like none other.

Finally I realized how an entertainer who had nothing of real value could finally compete. By simply lowering your price you can create the unique position of being the absolute cheapest entertainer in your area! What kind of a FOOL would possibly compete against you when you held such a low-value, low-profit position?!

And even if they DID compete against you (as "Giant 99¢" did against "$1.00 Bazaar"), you can simply turn the tables on them and lower your price even further (like "Mr. 98¢" did to "Giant 99¢"). The possibilities are limited only by the number of divisions in your government's currency!

As I con-templated the vastness of this marketing strategy I passed a store that clearly understood the concept. They were beating everyone to the punch. They were selling everything for just 79¢!

Unfortunately they wound up going out of business. I wonder why?