Showrooming | What Is It And How Is It Affecting Holiday Shopping?

Showrooming is the practice of examining products in a store, then leaving the store to purchase the product online at a cheaper price. Basically what happens is shoppers go into a store, take a look at a product they are interested in, then leave the store to go browse websites such as Amazon and purchase the item there at a discounted online price. For retailers this is a problem, so naturally they are trying to prevent this from happening. An internet poll found more than half of adult cell phone owners used their devices while they were in a store over the holiday shopping season to get help with purchasing decisions. Research shows that 70% of shoppers compare prices online while shopping in the store, using several apps that are designed to help showroomers such as Red Laser, Shop Savvy, and Amazon’s Price Check. Shoppers are able to scan the bar code using the camera from their smartphone and get an instant list of prices and websites.

Retail stores such as Apple and Best Buy are frequent targets of showrooming. Best Buy has been hit so hard by showrooming that it has gained a reputation as “Amazon’s Showroom.” Shoppers will go into Best Buy looking for a new HDTV, browse a bit, or maybe sit down in the demo area where they’ll decide if they can see that model in their living room. Once they’ve decided on the product they want, they will go home, get online, and order that exact same model at a cheaper price. Because of this, Best Buy and other retailers are trying to find ways to close the sale in the store and prevent customers from showrooming their products.

Of course, consumers want to save any money they can, so Best Buy has launched a new marketing campaign, “Your Ultimate Holiday Showroom”, where Best Buy is offering price-matching guarantees and in-store pickups of online orders. There is no way for retailers to completely prevent showrooming, but just like Best Buy, retailers will find a way to prevent consumers from shopping at competitors’ stores or websites.

Consumers should note that there are some advantages to purchasing in the retail store. One is having a physical person with whom you can ask questions about products. These people are usually salespeople and are experts on the products you are browsing. If there is a problem you can always return the product to the store or exchange it, or use in store perks such as product warranty. Some retail stores who are targets of showroomers charge a fee to speak with a salesperson. A camera shop in California actually charges $1 per minute to advise consumers on the proper way to handle a camera. If a purchase is made, the fee will be waived.

 

Showrooming Statistics

• 92% of consumers who showroom have used Amazon to compare prices.
• 58% of consumers who own a smartphone have used it for store-related shopping.
• 82% of smartphone owners who use their devices to assist in shopping while in a physical store use search engines to find product information.
• 33% of smartphone owners who use their devices to assist in shopping while in a physical store find product information on their phones instead of asking store employees.
• 37% of mobile consumers have purchased a retail product on a smartphone or tablet after researching it in-store.
• 55% of consumers who showroom use social media sites on their mobile devices to get product information.

As you can see, showrooming is a growing trend that is posing a problem to companies and businesses. It is great for consumers because they are now taking control of the buying process, but this is leaving retailers and other companies at a disadvantage. Best Buy has already taken initiative on the problem with their price match guarantee, and it is proving to be a very successful endeavor. Those who are fighting similar battles with showrooming are advised to follow Best Buy’s lead and learn to adapt to these modern day showrooming practices. Those who don’t will inevitably die out. Which one will you be?