It is a little more complicated than that. Yes consumers are trained to expect sales. It drives an increase in purchases. However, JC Penny is a sort of mid retailer. It isn’t high-end and it can’t support price competition to the bottom. Much like Kohls that basically lives on having things constantly “on sale” while all they really are doing is pricing below MSRP which is meaningless, especially when it is specifically designed to be underpriced.
They didn’t simply make “$29.99 + tax” into “$30, tax included” but they removed MSRP markings that were higher than their ‘sale’ prices. They removed the “.99” from prices and generally lowered them to under the MSRP always though not necessarily down to their ‘sale’ prices to overall bring prices down everywhere.
It’s “Everyday Pricing” initiative to lower overall pricing couldn’t compete with stores specifically designed to keep prices down and it certainly didn’t have the reputation of being upscale for any merchandise. Therefore, the only way to survive is to make consumers believe everything is on sale, always. Essentially fooling the customer into believing that they are getting a deal on better products for a cheaper price.
If someone wants to buy nice clothes, they will buy nice clothes and pay more for them. Underpricing them could actually hurt sales. If someone wants a ‘deal’ then they are going to go to low price competitors. Mid tier retailers are always going to have a tough problem to solve, unless you fool the consumer.
That marketing gimmick isn’t centralized to just the US or even North America. It works anywhere in the world for a mid retailer.
Perhaps, you believe that this makes the consumers stupid but that would be a universal generalization rather than an US cultural one.
I do love when people ascribe basic psychology to Americans and no one else. Only Americans walk into a room and forget why they went in there, everyone knows that!
It is a little more complicated than that. Yes consumers are trained to expect sales. It drives an increase in purchases. However, JC Penny is a sort of mid retailer. It isn’t high-end and it can’t support price competition to the bottom. Much like Kohls that basically lives on having things constantly “on sale” while all they really are doing is pricing below MSRP which is meaningless, especially when it is specifically designed to be underpriced.
They didn’t simply make “$29.99 + tax” into “$30, tax included” but they removed MSRP markings that were higher than their ‘sale’ prices. They removed the “.99” from prices and generally lowered them to under the MSRP always though not necessarily down to their ‘sale’ prices to overall bring prices down everywhere.
It’s “Everyday Pricing” initiative to lower overall pricing couldn’t compete with stores specifically designed to keep prices down and it certainly didn’t have the reputation of being upscale for any merchandise. Therefore, the only way to survive is to make consumers believe everything is on sale, always. Essentially fooling the customer into believing that they are getting a deal on better products for a cheaper price.
If someone wants to buy nice clothes, they will buy nice clothes and pay more for them. Underpricing them could actually hurt sales. If someone wants a ‘deal’ then they are going to go to low price competitors. Mid tier retailers are always going to have a tough problem to solve, unless you fool the consumer.
That marketing gimmick isn’t centralized to just the US or even North America. It works anywhere in the world for a mid retailer.
Perhaps, you believe that this makes the consumers stupid but that would be a universal generalization rather than an US cultural one.
I do love when people ascribe basic psychology to Americans and no one else. Only Americans walk into a room and forget why they went in there, everyone knows that!