Showrooming: Opportunity or retailer’s worst nightmare?

Let’s say a builder goes to Sears to see a saw. They note the name brand and price and then they Google it, see where else it’s being sold and at what price, and then make a buying decision: whether to buy it in the store for convenience, to purchase it online at a cheaper price, or to drive across town to a competitor to get a bargain. In other words, he or she is “showrooming” – using one store’s physical location as a showroom for products rather than a place of business — and it is a growing trend. It’s “smart shopping” with a “smart phone”.

On average, 90% of the people who enter a store now carry a cell phone in their pocket, purse, on or their belt. The 2012 Mobile Consumer Report, just released this month from Vibes (a mobile marketing and technology company), informs marketers that a whopping 84% of “showrooming shoppers” are conducting mobile research while shopping in-store.

Before you run to an app development company grab those shoppers’ online attention, be advised of another Vibes finding: While nearly half of all consumers will do an online product check to be sure they are getting a good in-store deal, only 17 percent of consumers have used a company’s app while shopping in-store.

Despite all of the money invested in app development, 69% of the people who sign on for a free app have unsubscribed from a retailer’s mobile database due to too many messages or updates. Shoppers don’t want to “join you” to “shop you”; they want to do an online search for the specific product, and they do that by surfing the web, scanning or texting for more product information.

How, then, can you compete against online discounters? Or is the future in online discounting?

Here’s a brief synopsis of Vibe’s four key findings:
1. Shopper confidence is important. “Providing accurate and accessible product information builds consumer trust and loyalty.”
2. Online sales can also benefit from showrooming. “29% of shoppers who used a retainler for a showroom ended up buying from the store’s own website”.
3. Shoppers will work to find a deal.
4. Lost sales to a competitor are a growing concern. “While 82% of consumers have their smartphone with them while shopping, 6% are likely to abandon an in-store purchase for a competitor.”

So… let’s go back to your website. Is it a magnet for showroomers or invisible? Is your site optimized for search engines? Do you provide useful product information on site, and pair that with knowledgeable floor salespeople, to whom you would refer buyers? Do you have a call to action, especially for your most profitable (versus most expensive) items?

Do you have someone online who can text replies to questions? Mobile users typically respond to a text message within 90 seconds, compared to the average email response time of 90 minutes (STIA 2012 statistics).

Vibe suggests that marketers “integrate mobile touch points into every stage of the buying process, from awareness and engagement through transaction and loyalty.”

Something to think about this week. Come back next week, when we’ll take a quick marketing quiz to see what else we can learn in five minutes!

About Jody Glynn Patrick

Jody is President of Glynn Patrick & Associates, which provides management consulting, executive coaching and strategic planning services. She is Publisher Emeritus of In Business magazine, which she published for 17 years. Selected as the “U.S. Business Journalist of the Year” in 2007 in Washington, DC, by the U.S. Small Business Administration, Jody has been a business reporter, editor, radio talk show host , and has won other state and national journalism awards. At the same time, she has helped corporate clients grow their businesses -- the basis for her practical coaching advice here. She also was the 2005 Athena Award recipient for her leadership role in mentoring other professional women. Jody will be talking with you weekly on TDS’ blog to share her insights and tips from the C-Suite perspective. Follow on G+.

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