Augustín unfortunately did not do any research about his new experiment nor did he do any testing to see how customers would respond to this new campaign. The reading notes that “the board had agreed to run hablar claro without testing it first” since they didn’t want to be led around by the “misguided” desires of their customers. Research and user testing is extremely important since it could’ve given Augustín indicators that most of his current customers are heavily drawn in my discounting and sales and that having none of these sales would deter them from visiting the store, regardless of how revolutionary this new approach may be advertised as. Research and testing could have also given Augustín more flexibility in pivoting and changing strategies if things weren’t appealing to customers as much. Instead, he invested a large amount of capital to redo all the stores according to this new strategy that he didn’t even properly test or research. He could have found out this conclusion at a much lower price point had he ran some tests instead of redoing all of his stores.
My recommendation would be similar to those mentioned in the experts section. I think that its clear that Augustín needs to bring back some element of sales and discounts in order to attract customers and keep the company alive. The only brands that I can think of that never do sales are those that are very high end and can afford to do so given their legacy and quality assurances. It doesn’t seem like Emilia fits into this category so this strategy is ill-suited for them. I agree that store-wide sales and discounts often cause customers to sit back and wait for sales to arrive so as to never pay full price because I personally shop like this at many stores. Because of this, I think that Augustín should have the strategy of moving things out of season into a sales section and having a loyalty program to increase and reward customer loyalty.
