Is showrooming still a concern?

Discussion
Photo: @Dari via Twenty20
Dec 21, 2021

Over half (53 percent) of Walmart shoppers made an Amazon purchase within a day of shopping in-store at Walmart, compared to 38 percent of both Target and Costco shoppers, according to a study from Numerator.

The findings come from Numerator’s TruView consumer panel that measures market share across in-store, online and emerging retail channels. The study aims to “quantify the showrooming effect,” or when a consumer heads to a store to see and touch the merchandise, only to purchase at a competitor online, often at a lower price.

Other key findings from the report:

  • Amazon crossover is substantial: Roughly three-quarters of major retailers’ shoppers also shop at Amazon.
  • Target has the largest opportunity to capture lost day-of sales: By preventing leaked same-day trips to Amazon, Target has the potential to capture 10.3 percent in incremental sales, followed by Walmart (+7.2 percent) and Costco (+4.7 percent). 
  • General merchandise items make up the majority of “leaked” sales to Amazon. The top four leaked categories (Home and Garden, Electronics, Health and Beauty, and Apparel) accounted for over half of all leaked dollars at each retailer.

Scores of articles in the early part of the 2010s warned of the threat of showrooming to physical retailing, but any losses of in-store sales to online competitors were eventually seen being offset by the opposite practice of webrooming (shopping online, purchasing in-store).

Still, showrooming does happen. A 2019 study from Conversant found 78 percent of Millennials and Gen-Z shop both in-store and online simultaneously and are 34 percent more likely than older customers to use a mobile device in a store.

Tactics to reduce showrooming include price-matching and emphasizing a multi-channel offering. It is also recommended that retailers try to deliver a more sensory experience, enhance in-store mobile engagement and ease checkout friction in order to make the in-store experience less transactional and discourage price-comparison shopping.

A study co-authored by Marshall Fisher, Wharton professor of operations, information and decisions, concluded that knowledgeable associates are a primary arsenal against showrooming. He told Knowledge@Wharton, “I think customers often times don’t intend to showroom, but end up shopping online because they get better information online than they’re getting in the store.”

DISCUSSION QUESTIONS: At this point, is showrooming a major, minor or non-existent problem for retailers? What measures help reduce or best leverage the practice in stores?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"I wouldn't classify it as a problem - it's the cost of doing business these days. While consumers do compare prices (which is easier online), people also cross-shop in general"
"...customer-first strategies could be leveraged to enable their brands to participate in the showrooming process."
"Really bringing e-commerce ease to in-store experiences is the one thing online-only retailers will never have."

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27 Comments on "Is showrooming still a concern?"


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Ken Morris
BrainTrust

The biggest problem retailers face is getting customers into their stores. If they get them to come, they will shop. Maybe not for the items they are showrooming but a sale is a sale. Given the labor challenge retailers need to improve their in-store online help and give the customers their top 20 answers to FAQs. Focusing on the customer journey and embracing showrooming will increase sales and profit.

Michael La Kier
BrainTrust

Of course showrooming is a problem for retailers. Shoppers have access to more information than ever before and most will take advantage of it to save money when shopping. Of course, the price needs to be worth it to explore, however.

Katie Thomas
BrainTrust

I wouldn’t classify it as a problem – it’s the cost of doing business these days. While consumers do compare prices (which is easier online), people also cross-shop in general. Most consumers are shopping Amazon, Walmart, Target, etc. and aren’t loyal to just one.

As a retailer, it’s about deciding where and how you want to win – by categories, channel, and most importantly, consumer engagement. And remember – Amazon is opening physical stores, which shows the value in showrooming, amongst other things.

Gary Sankary
BrainTrust

Exactly! This is how the market works today. Companies like Target and Best Buy who focus on the value prop of their products, services and price have not been hurt by showrooming. On the contrary, one their value prop is seeing an item online (Amazon) and having in hand in an hour.

David Naumann
BrainTrust

Showrooming is a real concern for retailers and, as the article states, saving the sale can drive an additional 5-10 percent in revenues. Providing exceptional customer experiences and service is the best way to prevent customers from showrooming. With lower prices as the primary driver to showrooming, offering customers loyalty points that offset the price difference may be a good option to increase loyalty and save the sale.

Shep Hyken
BrainTrust

Showrooming is natural. It’s simply price comparing. There was a time when retail pricing was dramatically different between in-store and online. Today the gap has narrowed, if not for all than at least for many items. If people are showrooming, it may be out of habit more than true price shopping. If a customer is in a store and asking questions about an item, and they end up buying somewhere else, I’m going to bet that often it isn’t as much about the price as the experience and process. Retailers must be better at selling, creating convenience, and provide a set of promises (easy returns) that entice the consumer to buy and not continue to compare.

Bob Phibbs
BrainTrust

No service and just product mean you are at high risk of being showroomed. As the study noted helpful frontline workers are the biggest way to deal with it. As I say, If I make a trip to your store, it better be worth the effort.

Liza Amlani
BrainTrust

Showrooming is only a concern if the retailer does not learn why the shopper is leaving their store without making a purchase.

Price or product choice learnings are critical and it’s up to the retailer to stay competitive. That means continuously learning what their customer wants and does not want.

Bob Amster
BrainTrust

Showrooming can only be avoided if all retailers were to price the same product at the same price. Since that is not likely to happen, other factors will come into play, such as the customer experience, the availability of product, the need, or the lack of a need for immediacy, and one or two others. If retailers cannot approach the threat of showrooming from one or all of those other angles, they will suffer the consequences.

Dion Kenney
BrainTrust
11 months 12 days ago

While “showrooming” continues to be a phenomenon for certain retailers and shoppers, there is a reverse pattern that we are seeing – the online researching of products and prices before going to a local store to “experience” the product. Clever retailers are leveraging the online channel as the “new front door to the store” and creating value-added elements to in-store shopping to differentiate from the hands-off, customer-serviceless online shopping experience.

Andrew Blatherwick
BrainTrust

If people are going into the store to “showroom” then the retailer has an opportunity to sell them something. If they were not going in at all, that would be a much bigger problem. Retailers have to compete on price, on convenience and on the ability to convert footfall into customers. The whole mix comes into play when a customer crosses the threshold of a store. It is up the retailer to make their offering compelling. Don’t stop them coming to the store or you have no chance!

Melissa Minkow
BrainTrust

Showrooming is simply the nature of the beast in an omnichannel, competitive world. The real issue is a positioning issue. Consumers buy the same product at a certain retailer because they assume it’s cheaper at that certain retailer. Target has always had a higher price point image in consumers’ minds and Amazon has always had a lower one. Encouraging shoppers to price compare in the moment can help mitigate the potential for them to buy from somewhere else.

Jeff Sward
BrainTrust

Showrooming is not a problem or a concern or an irritation. It’s an opportunity! Showrooming is now a fully ingrained shopper behavior. It’s never going away. And it’s not a problem that I’m in a store and pull out my phone. It’s an opportunity because — I’m in the store! I’m there, ready to buy! So either be price competitive, or have exemplary service, or have differentiated assortments that aren’t plastered all over Amazon. Better yet, do all of the above. I’m standing there ready to buy!

Oliver Guy
BrainTrust
Oliver Guy
Global Industry Architect, Microsoft Retail
11 months 12 days ago

The future of the store is as a multipurpose hub supporting omnichannel retail, and showrooming is very much part of this. Retailers need to embrace this in order to be successful going forward. This requires significant changes of store metrics as well as operational factors – these things cannot be underestimated.

Steve Dennis
BrainTrust

Showrooming is a reality that needs to be accepted, not fought. What should be focused on is creating a deeply customer relevant and memorable brand story that customers seek out–and then showing up in remarkable ways however customers choose to engage with your brand.

Neil Saunders
BrainTrust

A customer overlap is not necessarily a sign of showrooming, if only because retailers – especially big ones – have always shared customers with rivals. People shopping around is natural and a sign of a healthy and competitive retail market. That said, grabbing as big a share of wallet is important and retailers like Target have been good at this by creating differentiated, exclusive brands and experiences that make their proposition sticky.

Dick Seesel
BrainTrust

Showrooming has been an ingrained behavior at least for the past 10 years, and it’s not going away. If you are losing customers to Amazon or others while they are physically in your store and ready to buy, you need to figure out why. If you choose not to be competitive on an everyday basis, do you have an on-the-spot price matching policy? Are your in-stock rates and customer service where they need to be, in order to satisfy the shopper who walks in the door? Complaining about showrooming won’t save a single sale, but doing something about it will.

RandyDandy
Guest
11 months 12 days ago
Having worked in site-specific stores (like those “attached” to museums or other attractions) for many years, I can say that “showrooming” has a more insidious effect on this scale of retailer over the giants. The giants can, in some ways, afford it — or make broad changes in inventory selection. Whereas specialty shops really can’t pivot as nimbly. So each and every sale is key. What’s most vexing is that one would have thought visitors entered such stores as a way to enhance their experience overall. Of first seeing the “sight” and then, in some ways, commemorating the time with a souvenir of some sort. But some will be who they are. Not so much thoughtful shoppers but those only conscious of pure consumerism, based largely on costs, and thinking they’ve won something by finding it at a better price. In the books sections of these shops, I can’t even number the many times visitors rifled through coffee table tomes — and took pictures of covers. As a note for them to buy it elsewhere… Read more »
Gene Detroyer
BrainTrust

Showrooming is nothing more than going to a mall and walking in and out of stores to find the right item at the right price. Today shoppers have another tool to do the same online. Check out the movie “Miracle on 34th Street” and appreciate the Macy’s/Gimbels rivalry.

Retailers should accept showrooming and find ways to get a customer to buy then and there.

I just had an experience at Best Buy where I compared prices online. I pointed it out to the salesperson. He went to his computer and matched it on the spot. Will I shop Best Buy again — and be confident that I am getting what I need at the best value possible? You bet!

David Mascitto
BrainTrust

Features like inventory visibility, dynamic pricing (and possibly personalized pricing) and optimized product search will make showrooming even more problematic for competing retailers. Whether or not a shopper came in to the store specifically for the product “showroomed,” a lost sale is a lost sale. To combat the effects of showrooming, shoppers need to be incentivized to buy here and now. Retailers will need to determine which promotional levers will work for them, and could include price matching at checkout, loyalty points/club, sales-oriented associates (with the ability to make deals), store rebates, etc.

Craig Sundstrom
Guest

Not to be overly critical, but what was this study attempting to show? People shop at one site, and then the next day they shop at some other site … so? My understanding of “showrooming” is that it is looking at an item in a store — or maybe online if it has a good description — and then buying it somewhere else (presumably because of price); and that’s it. One would measure the prevalence by asking people how often they do this … not measuring vague behaviors and inferring what they’re up to.

OK, rant over and back to the question: my (admittedly WAG) take is that it’s a major issue; (most) others here seem to disagree … I guess we’ll need a study — a good study — to find out who’s right.

Brandon Rael
BrainTrust
Showrooming, or the paradox of choice, are elements that are an intrinsic part of the shopping journey and the art of discovery for the digital-first customer experience. In a mobile and digital-first world, retailers may not prevent customers from showrooming while in their stores or at their homes. However, customer-first strategies could be leveraged to enable their brands to participate in the showrooming process. Best Buy experienced one of the more significant retail comeback stories. In the early 2010s, Best Buy was not prepared to mitigate customers going to their stores, testing out the product, and showrooming on Amazon and other competitors’ mobile sites. To minimize this, Best Buy struck deals with major tech companies, including Samsung, Apple, and Microsoft, inviting them to set up their own “branded” kiosks or stores-within-a-store at 1,400 Best Buy locations in 2013. In addition, Best Buy invested significantly in their workforce by enabling and empowering the Geek Squad with product knowledge, thereby building a long-term relationship rather than pushing for a one-off transaction. Best Buy shifted its narrative and… Read more »
Ananda Chakravarty
BrainTrust
Customers almost always compare goods and products, but not always the same ones. A customer seeking a new pair of jeans might look in multiple places to find them — thinking about fit, comfort, styles, price, brand, influencers, and even peer review. They may visit a number of stores to find the “right” product or visit two stores to compare the same products. Showrooming does impact retail sales, but is a complicated issue that is tied to the customer. Certainly overlap of purchasers or purchases is not indicative of lost sales. So many factors affect a purchasing decision — brand loyalty, price (of course), quality, customer experience in the store, access to services before and after, product quality, substitute products, return policies, accessibility to a store, tactile engagement, and more. Analysis of the customer and their motivations plus understanding your ideal customers as a concept should be first before chalking an abandoning customer up to showrooming. Tracking and measuring across so many parameters can be a challenge, but figuring out some key customer patterns and… Read more »
Ken Lonyai
BrainTrust

All the VR type technologies that exist or will exist can never replicate experiencing real products. Even before the e-commerce boom, stores like Brookstone understood that and made most items accessible to be tried.

Combating showrooming will always be a challenge because people research features and price on line, but still want a sensory experience with some products before committing to buy. The opportunity is to capture shoppers in-store, before they leave for an online sale. Today, stores are far better situated to do so than in 2010 with better logistics and for many, one to two day delivery capabilities. Price, convenience, rapid delivery, and easy returns are the ingredients to block the Amazons of the world, especially since Amazon is often devoid of a price advantage. Really bringing e-commerce ease to in-store experiences is the one thing online only retailers will never have. So showrooming really can be minimized for retailers that want to work at it.

Anil Patel
BrainTrust
The Showrooming effect is unquestionably a major problem for retailers. But, at the end of the day, if it draws customers into your store, it should be seen as an opportunity. Showrooming is a great example of how stores play an important role in marketing by creating and reinforcing brand awareness. To leverage this opportunity, retailers need to improve their marketing efforts to enhance the perceived value of going to the store so that customers won’t mind paying more money for the same thing that is available on Amazon. Costco, for example, has a very loyal customer base. The brand excels at the post-purchase experience, and customers get the feel of getting the best deals on the products. They are happy to pay a minimum annual membership fee of $120 to enjoy these benefits. The only reason Costco customers will ever shop with another retailer or Amazon is if they need smaller quantities of products that are not otherwise offered at Costco. It’s time to rethink your store network, reimagine marketing initiatives, and throw out… Read more »
Bill Hanifin
BrainTrust

Showrooming can’t be stopped. Consumers are fully mobile now and, if we can’t convince people to stop staring at their phones while driving down a busy highway, how can retailers think they can manipulate them to reduce showrooming in their stores?

Showrooming does encourage footfall. Best Buy is a great example of where people want to see, feel, and touch merchandise before buying. They want to have a conversation with a store associate rather than a chatbot to learn more about which product meets their needs best. If some of these store visits result in an online purchase, so be it.

The retailers need to continue to focus on store experience, local delivery, and other benefits that give consumers reasons to continue to stop by the store.

Showrooming can be recast as fully positive if the retailer has the right perspective.

Oliver Guy
BrainTrust
Oliver Guy
Global Industry Architect, Microsoft Retail
11 months 3 hours ago

A major problem with showrooming is measuring it. Looking at revenue in combination with footfall is one way, but this is far from perfect for many reasons.

For so many purchases the ability to look, feel and try is something that can only be done physically. With so many choices available — particularly in apparel — the chances of the store having the exact item you want (style/colour/size) is very small — and this may drive showrooming. I still love the Bonobos model and struggle to understand why we are not seeing more similar offerings that encourage you to choose in-store but have delivered to your home.

wpDiscuz
Braintrust
"I wouldn't classify it as a problem - it's the cost of doing business these days. While consumers do compare prices (which is easier online), people also cross-shop in general"
"...customer-first strategies could be leveraged to enable their brands to participate in the showrooming process."
"Really bringing e-commerce ease to in-store experiences is the one thing online-only retailers will never have."

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