I was told when I was in China that it costs 10 times more to develop a new customer than selling to a existing customer. That is why customer services are so important. Generally speaking, if a customer says to the shop owner he/she has purchased from the same shop before, he/she is implying he/she should be entitled to a kind of favourable price. On the other side, the sales person should offer bigger discount to the a customer repeating his/her purchase.
But during those years in the UK, I found many cases that many businesses did not follow this rule, especially big companies.
Some time ago, when my broadband contract was due, my first thought was renew it. I saw an advertisement that a new monthly price was less than that on my old contract. When I called the customer service asking what monthly price would it be, I was surprised to know he did not want to give me the new advertised price. He said naturally, “The new price is for new customers. You can’t get it.” But I think it is a shame of a business if a loyal customer find he/she is paying higher “VIP price” than a new customer. I threatened to leave the broadband company, but the customer service still said he could not offer me the new price. A few hours after I hang up the phone, I was called by another person from the broadband company, probably from higher level, agreed to offer me the new price if I stay. I said, “Too late. I made up my mind. You should not ask the existing customer to pay more in the first place.” I feel nothing wrong for the business to offer a discount to attract new customers, but the business should be prepared to offer the existing customers the same discount if it is not even bigger.
I buy a lot from cash and carry. The prices are increasing now and then because of inflation. But I know some businesses just increase the prices to their existing customers. I have to closely monitor the prices all the time. I feel nothing wrong if the businesses offer differential prices to various group of customers. But I do not want to treated unfair just because I am existing customer.
Today I see Tesco and Sainsburys are both offering £15 off to new customers when they do their first online grocery shop when they spend £60 or more. It is massive discount. 25% off. Is Tesco and Sainsburys gross profit that high? Will they suffer a loss for attracting new customers? But that is none of my business. What I care is how to get £15 off for my non-first £60 purchase. I have not found any public vouchers to allow me to do that. In the forum people says just open a new account to pretend as a new customer. Tesco and Sainsburys must know people are doing that way. Why they want so many new accounts? Will “Zombies” accounts help beautify these companies’ financial report? Again, it is none of my business. I just will not do business in that way.