Coles is currently offering to pay the GST on feminine hygiene products under the banner “Why should you be taxed for being a Woman”. Why are they doing this and will it work?
This is a fairly emotional appeal, but as a male I can be objective on this (he says quickly ducking to avoid sharp objects being propelled at him by the females in his life).
Clearly many women feel this is an unjust tax. It was very controversial when first introduced, although the then opposition and now government has done nothing to remove it.
Firstly, by raising this issue, Coles gets far wider coverage than their advertising would otherwise reach. It becomes a topic for talkback radio and newsletters like this.
Secondly, the actual cost for Coles on a typical product of value around $5 will be 50 cents. Given the tight margins in supermarkets, this might be most if not all the gross profit on the item.
Thirdly, it is most unlikely that a woman will visit Coles to buy these products only and go somewhere else to do her weekly shopping. In fact she is likely to get her $100 weekly groceries at the same time as the purchase of these products.
Finally, would someone change where they do their weekly $100 grocery shopping for just 50 cents? If the 50 cents off had been for razor blades or Cornflakes it would just be seen as another special, easily ignored, but in this case, Coles are appealing to women’s feeling of injustice, and some might just change to support the principle.
Will it work? As in all these strategies there is only one way to find out.
Can you think of a way of spending money on your customers to get them to try you?
Will you convert to Coles, or do you just see this as cynical manipulation?
What do you think? Remember, the best commenters this month will receive a $500 printer.
Over to You. What do You Think? Post Your Comments Below.
Dr Greg Chapman is the Director of Empower Business Solutions and The Australian Business Coaching Club and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success.
The Australian Small Business Blog