Harnessing the Showrooming Trend
Showrooming — conducting price comparisons on a mobile device while in-store and then leaving the store to complete a purchase online — is a trend we’d love to dismiss. Unfortunately, according to a new study, this shift in consumer behavior is likely here to stay.
According to new research from GroupM, 45% of customers shopping in-store at brick and mortar locations will walk out and complete their purchase online for a discount as low as 2.5%. This number jumps to 60% of shoppers who will leave and purchase a product online for a savings of 5%. When discovering an online discount of 20%, only 13% of shoppers stay to complete their purchase in-store.
The study, “Showrooming & The Price Of Keeping Buyers In-Store,” takes close look at the influencers of showrooming to identify a tipping point for 1000 shoppers given many hypothetical scenarios for 10 products with varying price points across multiple retail categories.
“Consumers have shifted their path to purchase to include the store as a step, but not necessarily the final step; and this will likely continue to increase over time. Brands need to think about how showrooming can be used to their advantage to navigate would-be buyers to a checkout location, be it in-store or online,” said GroupM Next CEO Chris Copeland. “Showrooming is a label for a massive consumer behavior shift brought about by the ease of access to information on a mobile device. Brands that sit on either side, be it as the physical store or the online merchant, have multiple opportunities with this consumer change.”
Less than 10% of purchasers surveyed chose to complete their purchase in-store, regardless of a discount offered — which is hardly reassuring for retailers. Fortunately, the study found evidence that customer service plays a key role in in-store purchase behavior. Customers who interact with an associate were 12.5% more likely to shop at the brick and mortar location.
“Finding only a small price difference elsewhere using a mobile device is enough to entice a shopper to leave the store and buy online. By employing strategies to reach this massive audience segment, brands can significantly bolster their sales at the register or take advantage of their showrooming and effectively get the sale via a branded app or online property,” noted GroupM Next Director of Research Patrick Monteleone, Ph.D.
The typical showroomer profile, according to the report, includes females who are younger in age and make online purchases frequently. Alternately, “marginal showroomers” — a secondary group who are sensitive to price but can be influenced to remain in the store — are more than 90% male; have an average age of 52; have a median annual income of $60,000; and almost universally (98%) hold some college or higher education. These customers are also seasoned online shoppers: 55% buy online once a month, while 21% buy one a week, and 11% more than once a week.
As online brands creep into offline spaces with pop-ups and partnerships, it’s evident that a retailers counterstrategy should include technology to promote eCommerce within offline spaces to build loyalty across all categories. It's easy to look at these statistics and assume that showrooming is a consumer electronics problem but the behavior is far reaching. In May we posted about the impact of affluent males adopting a multi-channel approach to researching and buying online.
Having an eCommerce site or shopping app is not enough when shoppers are searching for the best price. Retailers should be capturing the 43.7% of shoppers surveyed, who use a mobile to shop while in-store, with a cohesive strategy that communicates ease of use, loyalty benefits, and a price guarantee. Mobile might take shopping beyond the boundaries of four walls — but familiarity with a brand is also a key influencer.