I did my own bit of research for this article.
I was shopping with my wife for several pieces of furniture on Saturday, and tracked my own behaviour, and that of another five couples in a large, multi-brand furniture store.
Of the six couples, three were showrooming.
Showrooming is a concept often associated with consumer electronics:
‘The practice of visiting a shop or shops in order to examine a product before buying it online at a lower price.’
…and perhaps the most high-profile story recently was that of retailers in the USA adopting digital price tags in order to keep up with Amazon.
With the advent of mobile, this definition has changed slightly, as it used to read ‘buying it online from home at a lower price’, whilst in fact people often haven’t even left the store before they have bought the item on their smartphone.
Of course, this mostly hits retailers that sell products also sold by online retailers, but own-brand retailers also fall foul as they grow and use multiple channels to market, making it difficult to avoid their same products showing up online.
Retail has been one of the slower segments to react to the rapid rise in smartphone use. One of the challenges has been a lack of standards in systems – especially in ePOS and the lack of a single customer view across online and in store. Creating a compelling and engaging consumer experience in store is tough, but it’s something that retailers need to do.
What was fascinating for me was that I showroomed without even thinking about it – using the online price tag as a mechanism to reduce my own expense. In the end though, we ended up paying a bit more as the advice and service we received was excellent. Two of the smaller items which would have taken a week plus to be delivered online were actually delivered by the store manager the next day – a Sunday – in his own car.
Many retailers’ reactions to showrooming are negative, but there is another way to look at things. If consumers are using your stores to showroom, this is actually an opportunity. Your competitors would love to have that footfall, it’s just a question of what you do with it.
A relatively basic approach is a price match policy. One analyst, who looked at cases where electronics stores agreed to match all online prices, suggests that it may not be the costly exercise that it initially appears. Not all consumers price match, and for those who do, it may be worth the lost margin to bring those customers offline.
The more successful retailers are focussing on the “value add” that’s going to swing the customer to buy in store. Bricks-and-mortar retailers can do things the online retailers can’t – faster delivery, installation, fitting and setup, style advice, easier returns, and much more. You will always have those customers that go for the cheapest price irrespective, but the majority, I believe, want good value which isn’t just about price.
Industry commentators appear to be split on whether showrooming is inevitable, an opportunity or a threat for retailers. For me the phenomenon is simply an extra accelerating factor. Poor bricks-and-mortar retailers that add little value, and who fail to embrace showrooming as a way to engage their consumers, are quite right to feel threatened.
Good retailers should have nothing to fear.
About the Author
Steve Emecz works for Powa Technologies as SVP Business Development. An expert in all things commerce and mobile, he publishes frequently to LinkedIn – and somehow still finds time to run his own publishing house.