What Is Showrooming and How Does It Affect Retail Businesses?
Due to the advent of the internet, Wi-Fi and smartphones, and the increased ease of online shopping, many people are now using offline stores as showrooms – a place to view items in person before ultimately ordering them online. This can cause some issues for offline stores who have to not only demonstrate the products to the public, but can still potentially miss out on sales once the person leaves the store.
Online purchasing affects stores and the local economy in a big way. Every dollar spent online is taken away from money that could stay in the community in the form of sales taxes collected as well as the price of the goods where most of the dollars collected stays in the community. If offline retailers want to compete and keep money in their town, and stay in business, they have to find ways to address the issues.
It can be very difficult for retail businesses to compete due to the ease at which consumers can find a better price using their smartphones while shopping in a store. The practice is most prevalent for smaller, easily-shipped items and electronic devices. If an online store offers free shipping, people are apt to buy anything online because then they don’t have to worry about delivery. This includes furniture.
To compete, bricks and mortar stores need to address the issues that shoppers have which are usually just two things – price and service. If a store cannot compete on price then it’s imperative that they compete on offering extras, above average customer service and convenience. Consumers will not quibble over a couple of dollars if the customer service is above par and you make it easy for them.
All an offline retailer can do is embrace the new technology. It’s here to stay and will not change any time soon. One thing a retailer can do is get exclusive access to certain products from their vendors for a limited time, as well as begin their own online sales. It’s important for retail store owners to see showrooming not as a threat, but as an opportunity to be better, do better, and sell more.
Studies show that if prices are close, people prefer to buy locally as long as the customer service is good and getting the item back to their house is made simple. If the store can afford it, they can try price matching, free delivery and potentially adding extras into the purchase. Showrooming is really nothing more than enhanced comparison shopping, something people have been doing for decades.
Bricks and mortar business owners just have to realize that this is how things are now and find ways to compete that works for them. The two choices, pricing and customer service gives a business owner a lot of leeway and a way to compete that online retailers really cannot do. They might be able to offer a low price, but usually there are shipping costs and lousy customer service. A bricks and mortar business can beat most of those, hands down.