What is it?
According to Wikipedia; “‘showrooming” is the practice of examining merchandise in a traditional bricks and mortar retail store without purchasing it, but then shopping online to find a lower price for the same item”.
In a nutshell, customers to come and look at, touch, feel, and try, but not buy.
Early adopters have cottoned on to this trend with some retailers encouraging the practice by holding no stock on site and sending you to their website to buy on-line. Some have taken a reactive approach and have opted to charge customers for the privilege of browsing. Some have done the complete opposite and driven down their prices in order to compete with cheaper online alternatives. Online giants, like ebay, have taken things even further and are investing in what is best described “digital window shopping” to encourage showrooming.
There is a lot of noise in this space, but it seems that no one really knows how to tame the beast. Do you challenge it, or do you embrace it?
Do customers really want it?
On the surface it looks like a great model for the retailer. It’s cheap – no cost of storing stock, no issues with out-of-stocks, no tills or bags and a low staff overhead. But does it really work?
Is showrooming what customers really want? Do they go online and shop with your company, or do they price compare and shop with a competitor?
Bizrate conducted a survey recently which showed that, of the 21.85 per cent of customers who had “showroomed”, 54 per cent kept their purchase choice with the same retailer.
I would suggest that the majority of people that go on to buy from the retailer after showrooming do so because they want to be part of something new, or are already loyal to the brand and therefore would have purchased from this retailer either way.
How should we react?
The ability for showrooming to take off, other than for novelty’s sake cuts to the core of our shopping motivation. Do we shop for pleasure or do we shop to fulfill a need? Just because we can shop online doesn’t necessarily mean that we want to. Women in particular see shopping as an enjoyable leisure activity, best done with friends. It’s hard to have the same experience online. However, when it comes to making our life easier; booking services, paying bills and sending mail, it’s all done more quickly and more efficiently online.
Many retailers are beginning to realise that shopping is fast becoming experience based. It’s not what you know about the product, it’s about the relationship you build with the customer. The ability to create the right solution and to give them a new experience that they can’t replicate should be at the forefront of your sales strategy. Retailers need to concede that they probably can’t fight the trend and; “if you can’t beat ‘em, join ‘em.” The customer experience is slowly moving into the technical space…who said that they had to leave your store to fulfill that need?