If one runs a local shop, some potential customers come in order to get advice or a product recommendation but then buy the respective product online where it typically is cheaper. How can potential customers be encouraged to buy in the shop when they make use of the given advice? One possibility would be to charge for the advice and then provide a respective discount if they decide to buy. However, this will discourage many potential customers to even get advice / come to the shop. Are there better strategies?
My wife bought a camera at a local camera store just yesterday. I would have researched cameras online and ordered one from Amazon. Her experience was amazing.
The owner of the store asked her lots of questions about how she intended to use the camera and what mattered and didn't matter to her. He walked her through several cameras and showed her what features they had and the advantages and disadvantages. He explained trade-offs around price, features, size, durability, and so on. She found the perfect camera.
He explained to her that by buying at his store, she would get up to 30 minutes free instructions on the camera after she had used it for awhile to ask any questions that came up. She could attend one photography course for free (one was going on in the back of the store at the time and it looked like fun). He offered her all kinds of discounts on their in store printing services and even explained archival services for old video tapes, film, and slides.
He helped her pick out the perfect case and the appropriate accessories. There was no hard sell, just a friendly store owner.
The price seemed kind of high, but I didn't say anything. Later, I researched the price because I was curious, and it was about the same price as Amazon, within about 3%. And we had the camera that moment, all set up and ready to go.
I hope she doesn't find this answer because I'm going to have to say it -- she was right.
So give your customers a great experience and charge a reasonable price. They'll come back.
You need to offer a shopping experience that Amazon or Walmart don't and that's valuable and tailored to your specific customers. You can't compete on price or variety so it has to be quality of the experience & service and/or the curation and quality or your goods.
You need to create a clear identity of what you are and what you are not and then consistently implement this. A friend of my wife does this really well: she runs an art gallery, has build long-term relationships with many customers, makes sure that browsing customers always are made feel welcome and not pressured, has trained her staff on how to interact with customers and help them make decisions etc.
Of course many people walk out without buying anything or buying somewhere else or online. But in aggregate: if people have a good time in the store and feel welcome and valued they are more likely to come back and will also tell their friends about it.
It definitely depends on the type of shop. Strategies for a store that sells digital cameras would probably differ significantly from strategies for a store that sells gourmet meats and cheeses. In general, though, I think the best strategy is to create a positive customer experience from the moment they walk in until the moment they leave and charging for advice runs counter to that. There will always be penny-pinchers who refuse to pay more than the lowest price on the market but there are also those who value the experience and these people tend to be loyal customers. (Obviously, if your prices are outrageous, people won't buy from you no matter how good the experience is.)
There was a small health food boutique in the neighborhood where I used to live. I liked it because I could easily ride my bike there to grab fresh ingredients every few days. Everyone who worked there was helpful and courteous and I got to know all of them on a first name basis. I probably could've gotten all the same products at Whole Foods for a lot cheaper but it would've been out of my way and instead of an enjoyable experience, it would've been a chore.
So, my advice would be, instead of trying to avoid people coming in just for free advice, encourage as many people as possible to come in and to keep coming back.
This may not be appropriate for your situation, but I've seen places that will charge for e.g. "Professional Ski-Shoe fitting", which is then redeemable against the cost of purchase for said item.
That way, a process which may take considerable time and expertise is paid for, and the customer is encouraged to buy in-store with the cost offset.
How to avoid
You can't, so you balance the advice judgement calls against likelihood to buy in the shop.
With the advice, it's a good customer relations to give solid honest advice. Whether they then buy from you is the only issue. That's an unavoidable risk you take having a shop and loss of customers should be negligible everything else being equal. Of course you push your line of goods where you can. But most people will buy at the shop if they've taken the time to go there and it's not overpriced.
Buying online is only cheap if you do everything online or you get your advice over the phone, otherwise it's an expense to go and get advice, shipping headaches etc,.. Most people who don't buy in the shop after talking are either shopping around for a better price locally or not going to buy anyway.
In addition to JPI's excellent answer, I've seen stores providing services related to the product they are selling. For example, a plumbing supplies store may team up with a local plumber to provide a fitting service
Can you find something that is related to the product you sell, that needs face-to-face interaction?
Avoiding visits of such potentials will lead to more crisis and towards the closure of a business. If you have identified that they buy online just because of the price factor then you must try improving your offering price to get near or beat the online price PLUS your advantage is that you have a real product in stock to see/touch/feel and carry out with them.
Many stores are facing this problem even throughout the world. So you should look forward to establishing your own online portal to offer the convenience of online purchase to your potentials. An online presence will become mandatory for businesses soon or later.
Try engaging with such online portals (like sell on amazon or whatever) your potentials are buying instead of you and establish your presence there.
It is true that the use of knowledgeable salesperson costs money regardless of prospects buy from your or not. However, you can make use of technology like make your videos on youtube (and other platforms) to reduce human efforts.
You shall also try taking feedback from prospects to analyse their preferences and reasons to buy or not buy from you after given genuine advice on their required products/services. This will help you decide and improve your marketing/business strategies.