Showrooming is when consumers use their phone to compare prices online while they’re in your store. Except you already know that because in recent months, showrooming has become the most talked about threat to traditional retail. So now you’re competing everywhere, all at once, like it or not.
One obvious way to overcome showrooming is to have a competitive price position – something that’s incredibly easy for our clients to achieve – but that’s only one method of winning the war against showrooming.
The Guardian recently revealed that showroomers represent 6% of all shoppers globally but they make up nearly 50% of online purchases, a third of which are made at online-only retailers. The act of showrooming is on the rise – in China 24% of consumers price compare when in store. Now that it is so easy to spot price differences, showrooming is the future for all markets, because price changes between channels are no longer tolerated.
Based on our in-house analysis, we have identified two key facets to address showrooming definitively:
1. Quit the online vs offline
The bricks & mortar versus online battle is outdated. Successful retailers know that multi-channel ends the power struggle between digital and physical. Whether in store, at global locations, on a device or through a social source – the message must be in sync, and so must the prices. Consumers will showroom because they have come to expect a price disparity between instore and online. Retailers need to understand that the online price is the “real” price because it is the only one that matters to their customers. If it’s being left to your customers to sniff out better pricing at competitors, then you’re not looking at the right data.
2. Differentiate, and have the right assortment
Fundamentally, you can’t always compete on price; but showrooming isn’t solely about price, it’s about optimising value. Retailers need to increase the relevance of their products and to identify new opportunities swiftly. Finding gaps in a competitor’s assortment, conducting analysis of what consumers are talking about and identifying commercial trends in the forming stages are all critical in offering the consumer something they can’t get elsewhere. Using data to iterate on what has worked and what hasn’t keeps these retailers in sync with their consumers and ahead of their competitors, remaining competitive, even at full price.
Showrooming is here, most likely for good. Fighting the shift is pointless: the way to be competitive is to operate inside the market that your shoppers are already in. This is something we’re helping a number of retailers with. Get in touch if you’d like to find out more.