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Harvey Norman Price Guarantee Is Only As Good As The Franchisee

When the rubber hits the road with a Price Guarantee

It is one thing to offer a killer guarantee that gets customers in, but what happens when a customer calls upon it is just as important as the guarantee itself.

Over the past couple of weeks we have had a number of “customer service” situations arise which we are blogging about. In today’s post, I look at the impact of having a killer guarantee that staff are not prepared to honour.

The Harvey Norman Price Guarantee

Harvey Norman have this awesome price guarantee – they will match the advertised price of any of their competitors. It’s a great way to get someone in the door.

There are exemptions to it, and you can find the fine details at Guarantee Details

The Good Guys are rocking this weekend

This weekend I went shopping with my son and future daughter in law to buy a fridge and washing machine. We did the normal crawl from white good store to white good store. They knew exactly what they wanted, now it was time to get the best price.

It’s too late for everyone reading this, but The Good Guys in Castle Hill had an awesome sale on. If you bought any item over $500 then they took $100 off the ticketed price. That’s $100 off the already discounted price, and the ticketed prices were already competitive. On an $800 fridge and a $650 washing machine, that’s quite a saving.

(There was the clause of one discount per customer, but when there are 3 of us from 3 different addresses with 3 different credit cards, then securing two deals isn’t that hard).

Harvey Norman’s Sales Rep Response

Armed with The Good Guys prices, we visited Harvey Norman. Their displayed prices were similar but then we mentioned the $100 off deal. Initially the sales rep was sceptical and asked us to get proof. We went back to The Good Guys, took some photos, and returned to Harvey Norman.

By this stage they had made the decision to not match the price. It was too low and they would be losing money.

The sales rep tried to justify it. His argument was simple – it was an “instore promotion” and not an advertised deal. Having big signs all over the store was not an “ad”. It had to be in the printed media or online.

In the end he said it wasn’t his decision, but the franchise owner’s.

The Harvey Norman Franchisee’s Response

We asked to speak to the franchisee. Surely they would honour the guarantee.

Once again, an explanation about how The Good Guys would sell items at a loss and that they could not match every ridiculous offer made by The Good Guys.

Wait a minute … isn’t the point of the guarantee that you will match every offer made by the competition?

Apparently I missed the clause about the opposition being reasonable – which I take it is a euphemism for “profitable”.

The eventually caved

In the end the franchisee did go off to work out the best price and returned after 15 minutes saying the could match the price. They would do it out of good will.

I bought it from Harvey Norman because I wanted to pay for it on my credit card to gain the extended warranty, and not have to split it over two cards. Sorry Good Guys, in this you were the Good Guys but lost out by expecting us to split the payments.

Three guarantee lessons

Guarantees are there to protect the consumer, not the seller.

I really don’t care if you are making a profit or a loss – if you make a promise then honour it. There are times when you will have to bite the bullet to make the sale. Don’t make your problem my problem.

It’s there to help build TRUST

A guarantee is there to help me trust you. The problem is, if I have to spend half an hour trying to get you to honour your warranty, then why would I ever trust you again?

The key principle I try to maintain in my business is that the customer needs to know that you have them covered. We have a money back guarantee and we need to be able to stick to it.

When you honour it, do it quickly and easily

I don’t know if they want us to think that we got a great deal because of how hard we had to fight to get the discount. Reality flash – we know that you still made a profit on the deal.

Instead, I have now shared this story with a number of people. I wasn’t going to write this post, but you wasted way too much of my time.

If you want people to say “wow, Harvey Norman matches prices” then do it quickly.

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