Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now


Showrooming And The Future Of Retail

Sony and Samsung set stricter pricing policies aimed at limiting discounts on their televisions. Consumer electronic sales slip at Sears. Best Buy closes 50 stores. All blame showrooming, the increasingly common practice of checking out items in stores and buying them online.

ComScore estimates that at least 30 percent of all U.S. consumer electronics sales now take place online. And that share is growing, thanks in large part to the emergence of mobile shopping.

“The prevalence of smartphones provides customers with the ability to do price comparisons in real time, while still in the store, increasing the challenge retailers are faced with to offer the best price,” said Perry James, home and office supplies president at The NPD Group. It recently conducted a survey that showed up to 20 percent of consumers admit to checking out a product in a store before purchasing it online.

And while consumers clearly are driven by price, they are open to other information. That’s where mobile shopping apps come in, offering retailers and brands value by providing new and creative avenues to market to consumers. So mobile shopping — and showrooming — should be embraced, and sooner rather than later.

Leveraging new technologies and practices

Such a shift in thinking requires retailers to ask themselves three key questions:

1. Why should I embrace mobile technology?

2. How can I best compete with online retailers today and tomorrow?

3. How can I leverage mobile technology to drive revenue?

Mobile technology is here to stay. Businesses that refuse to embrace it will be left at a competitive disadvantage. Remember that discussions about online vs. brick-and-mortar retailing don’t always have to be about price. What about the shopping experience? And don’t discount the fact that mobile shopping drives revenue by offering in-store marketing at the point of sale.

To educate retailers and brands and help show them a path forward, ShopSavvy has become a consistent, vocal educator and advocate of mobile shopping. More than two years ago, we launched the “Scan with ShopSavvy” initiative in cooperation with Ford, Gold’s Gym, Washington Metro and other brands, to educate consumers on scanning QR codes. Continuing that educational advocacy, the company is working to provide online retailers and brick-and-mortar retailers a forum for their viewpoints on critical retailing issues of the day such as showrooming and the impactof on local retail and local communities.

Seeing showrooming as an opportunity

The Pew Internet and American Life Project tells us that during the most-recent holiday season, 52 percent of shoppers used their smartphones to perform research while standing in retail stores. Of those who used their phones for online price matching, 19 percent purchased the product online.

Fears about showrooming are very real among retailers. At a recent retail conference, panelists recommended various “solutions,” including:

  • offering products not found online;
  • disconnecting Wi-Fi and blocking cell signals; and
  • banning the use of devices that can be used as bar code scanners.

Those suggestions make it obvious that retailers aren’t approaching this situation proactively. They need to see showrooming as a great way to grow their own businesses. It may sound obvious, but at any given moment more shoppers are in their competitors’ stores than in their own. Look at these figures:

  • Best Buy has 1,099 out of 43,810 electronic retail locations.
  • Barnes & Noble has 691 out of 32,050 book store locations.
  • Macy’s has 805 out of 36,140 department store locations.
  • Safeway has 1,725 out of 253,572 grocery store locations.

What if a retailer like Best Buy could start a conversation with the shoppers in the 42,000 locations they don’t own? Mobile technology can enable a retailer to start a conversation with a consumer at the point of purchase both inside and outside of their own retail store locations.

Retailers that leverage an omnichannel approach as well as mobile applications such as ShopSavvy can reach far more shoppers than they can with retail locations alone. The key is to start a conversation where consumers are, not where we wish they were.

 Alexander Muse is co-founder and CEO of ShopSavvy. He can be reached at [email protected] and (214) 550-2003.