Could ‘Showrooming’ Actually Be Good for Brick-and-Mortar Retailers?

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Stores hate it when shoppers scope out merchandise in person, only to whip out a smartphone, shop around, and ultimately make the purchase elsewhere. Yet could this practice, known as “showrooming,” wind up helping retailers, even resulting in more sales for the store that’s thought to be used merely as a showroom?

A new study by the mobile marketing firm Vibes indicates that showrooming is not necessarily a bad thing for brick-and-mortar retailers. The fact that consumers are increasingly hitting stores with smartphones in hand can actually boost sales, researchers say.

How could this be? According to the Vibes survey, while losing sales to a competitor because of smartphone research is a growing concern among retailers, the percentage of shoppers who are likely to abandon an in-store purchase to close the deal elsewhere is quite small. One-quarter of shoppers who showroom—just 6% of shoppers overall—are likely to do what we think of as pure showrooming, in which they check out an item in person in a store before purchasing it from a competitor such as Amazon.

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Meanwhile, 82% of shoppers hit the stores with their smartphones, so the loss of sales due to showrooming could be much worse. What’s more, nearly 3 in 10 shoppers (29%) said that they used a physical store as a showroom and ended up buying the item not from a competitor but from the physical store’s own website.

This is a different sort of showrooming, one that store managers and sales staff who work on commissions might not like, but one that is here to stay—and from the retailer’s point of view, a situation that’s far preferably to losing the sale to a competitor. What’s curious is that, even as shoppers view purchasing at a brick-and-mortar store as the same as buying from the store’s website—the money goes to the same place, right?—in some some ways stores can view their own websites more or less as competition. “They have separate teams and business units for each with different approaches, offers and information and even prices,” the Vibes report states.

Such distinctions are foolish and outdated, according to Vibes researchers, resulting in confused shoppers and possibly hurting sales. It makes far more sense if the online and in-store teams are truly on the same team, sharing similar goals and offering a seamless sales experience no matter how the consumer wants the transaction to happen.

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Thus far, retailers have taken many steps to dissuade shoppers from showrooming. They know they can’t stop consumers from using smartphones in their stores, so retailers such as Target have launched shopping apps of their own that incentivize in-store browsing and purchasing. Many major chains have also been pushing to sell more goods that can’t really be “showroomed” because they aren’t sold in other stores. The new kids’ tablet from Toys R Us is a recent example of this strategy in action: It’s sold exclusively by Toys R Us, so it’s impossible for a shopper to find it for a cheaper price—or find it period—anywhere else. (Of course, it’s always still possible for a shopper to find and buy a competing product elsewhere.)

But Vibes researchers say that instead of battling against showrooming, retailers should embrace it. First off, “If you offer price matching, your associates should be trained to observe ‘showrooming’ behavior and approach customers proactively with offers and information to help close the sale,” the study states.

Retailers should also understand that the presence of a smartphone in a shopper’s hands can be an aide to closing the sale. In the survey, 48% of showrooming shoppers said that they felt better about their purchase after doing some in-store research and shopping around on their phones. What smartphone-enabled shopping eliminates is the well-founded concern consumers have that soon after they make a purchase they’ll find out the item had poor reviews or was available for a much cheaper price elsewhere. With a little pre-purchase showrooming, however, these worries fade.

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Only 15% of shoppers, meanwhile, say that they were dissuaded from making a purchase after they scanned an item with a smartphone for ratings or additional information. That’s nearly the same proportion (14%) of shoppers who indicate that they made unplanned purchases after doing some research with their smartphones.

Brad Tuttle is a reporter at TIME. Find him on Twitter at @bradrtuttle. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.

7 comments
ChristopherKrywulak
ChristopherKrywulak

Good article. In-store smartphone use and comparison shopping is a big challenge for retailers. The key is to offer an in-store experience that is so good that it will convert as many walk-in customers as possible -- including those who are showrooming. Often, that means offering an omnichannel shopping experience: one that provides the convenience (information, checkout, delivery/pickup) and consistency (information, experience) of shopping on your phone, right there in the store. That's what we're working on at iQmetrix. Have a look: http://www.iQmetrix.com/produc...

Liz Leyden
Liz Leyden

Catalogs and mail-order have been around for at least 150 years. Why is showrooming considered such a bad thing?

Done right, stores can make showrooming work. A friend of mine works for Sears. Her department's selection is limited, but customers can try out the merchandise, then order it online at a kiosk, with lots of options (ex. color). Kiosk orders get free shipping plus whatever discounts apply in-store, and sometimes they add extra discounts. Customers can pay in cash at the register. The receipt has a reference number, so customers don't need e-mail or computer access.

Kiosk orders are assigned to whoever swipes their card through. The orders count toward the employee's sales, so they get their commission, making it a win-win situation. Kiosk orders are very popular with elderly people, migrant farm workers, and people who don't want to use their credit cards online.

Alan Smola
Alan Smola

Very interesting article. I feel that unless the price difference online is a dramatic difference from the store, guests would much rather just purchase the product and be done with it, as opposed to having to buy online and wait for the product to arrive via shipping. The increasingly impatient nature of guests could work in favor of brick-and-morter stores, such as target.

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Manmohan Manu
Manmohan Manu

Informative article. I work for McGladrey and there's a white paper on Retail ( http://bit.ly/JDHmUU )  that describes current Challenges faced by US  retailers.

DavidCameron
DavidCameron

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AdityaJayaram
AdityaJayaram

Very good article on retail sales .  there’s a white paper on the McGladrey website about this very topic that readers will find interesting. http://bit.ly/JDHmUU It describes several issues impacting retail sales, closures and acquisitions.