It’s said that love is the universal language; and I think that’s right.
But if there’s a single universal word, it must be “SALE.” Four letters: “S,” “A,” “L,” “E.”
That’s my conclusion after spending two weeks in Japan and Korea last month.
Even though neither country is English speaking, and even though both countries use a printed language derived from Chinese characters, I saw the word “Sale” in stores everywhere, written in English, using English characters.
Sometimes the word stood alone, printed on a sign that only said “Sale,” and nothing more. Like an internationally recognized beacon.
Other times, the word was surrounded by Japanese or Korean, which I couldn’t decipher. But the savings message — sometimes expressed as a fixed yen or won discount, sometimes expressed as a percentage off — was as clear to me as if the sign were written in my native language.
As I strolled through foreign shopping districts, the word “sale” called out to me. It grabbed my attention and made me want to take a closer look.
And I wasn’t alone. What really surprised me was that the same small word, written in English, has the same powerful effect on the behavior of Japanese and Korean shoppers.
Despite their passion for anime and manga, despite their obsession for high-priced electronic gadgets and despite their culinary penchant for obscure sea creatures, Japanese and Korean consumers are motivated by the same marketing cues that stimulate purchases in North America.
I found myself halfway around the world surrounded by a familiar retail environment. Big window signs touting bargains drew shoppers off the crowded sidewalks and inside toward the sale racks. Just like here, in Miami, the mere presence of a “Sale” sign increases demand.
For me, the sale signs were like a flame to a moth. I didn’t have any familiarity with Japanese or Korean prices and was curious to see what merchandise the stores were trying to move and how attractive the prices were. (I know that’s an odd bit of sightseeing, but it’s what I do.)
Even though there are 100 Japanese yen and 1,120 Korean won to a dollar, like Americans, Asian shoppers are lured by prices ending in “9.” The huge 108-inch, curved, super-HD TV in Seoul was 132,499,999 won, or about $119,000. Like a freshly caught Bluefin tuna, the TV’s obscene overpricing only led to deeper and more passionate consumer engagement. And the fact that the TV’s price ended in 9 was a signal that it was on sale.
In fact, 9 has the power of a sumo wrestler. Research shows that an item priced at $2.99 can outsell the same item priced at $2.00. Similarly, increasing prices to end in 9 frequently leads to an increase in sales. So, when $295 becomes $299, retailers tend to sell more units at a $4 higher profit margin. I’ve had success increasing prices from $85 all the way to $99, without any loss in sales volume.
Japanese and Korean merchandising strategies also made me feel at home. Less expensive items, such as T-shirts, were presented as percentages off, 40 percent, 50 percent and up to 60 percent off, which is an eye-popping good deal, even if the actual savings was less than 1,000 yen. More expensive items, such as digital SLR cameras and lenses, were presented as absolute cash savings, such as 15,000 or 20,000 yen, which is a small percentage off but a fistful of savings nevertheless.
So I guess if love is the universal language, and “Sale” is the universal word, then love of sales must be universal among shoppers worldwide.
To which I say, “Thank goodness.”
Adam Snitzer is a revenue strategy expert and president of Peak Revenue Performance, a consulting firm that specializes in designing and executing innovative pricing strategies. He can be reached at firstname.lastname@example.org, or via the company’s website at PeakRevenuePerformance.com.