Showrooming: Is It Really A Threat To Retailers?

Elizabeth Gaines

How Big A Threat Is Showrooming?

Showrooming: Is It Really A Threat To Retailers?Depends on whom you ask – some retailers are terrified of the shopper who pulls out their mobile phone in order to comparison-shop online.  The customer’s logic is simple, why buy from the local store if you can get it cheaper online?

Other retailers feel less threatened by showrooming – they know their customers have always been comparison shoppers, it’s just that now the process is much more efficient.  Instead of spending an entire day driving from store to store comparing prices, consumers can explore their buying choices much faster online.

How Are Retailers Responding To Showrooming?

According to a benchmark survey on mobile in retail conducted by RSR Research, responses vary widely:

  • 37% of respondents say that they respond to showrooming by trying to be competitive on price
  • 32% say they haven’t seen a problem with showrooming
  • 13% stick their heads in the sand and ignore it
  • 13% try to match the online price
  • 5% actually try to beat the online price

Why Such A Wide Array Of Responses?

Showrooming: Is It Really A Threat To Retailers?Some of it may be attributable to what type of products a retailer is selling. Classic impulse purchases, like a tempting array of chocolates, are less vulnerable to showrooming because a hungry consumer does not want to order online and wait several days for the product to be delivered.

Big-ticket purchases are more likely to be researched online, particularly if it is a mass-market product that is available from a variety of retail outlets. TVs, home appliances, and consumer electronics are particularly vulnerable to showrooming.

But don’t forget that while some consumers are doing their comparison shopping in-store before purchasing online, there are others for whom the path to purchase runs in the opposite direction.

Some consumers do their comparison shopping online before heading to a store where they can purchase the item from a retailer they trust to be there tomorrow if they need service or support.

It Comes Down To A Matter Of Trust

Showrooming: Is It Really A Threat To Retailers?Now that the proliferation of mobile devices has made it so easy to comparison shop across channels, retailers must focus on building a relationship of trust if they want to win the sale.

If the consumer can’t count on you to offer them a fair deal, it is all too easy for them to find someone else who will.

Nikki Baird, Managing Partner at RSR Research suggests these three basic tactics for laying a foundation of trust:  

1. Maintain consistent pricing across all channels  

For years retailers have averaged their margin across categories, so don’t fall prey to the argument that brick-and-mortar stores have a different cost structure than online. Consistency is vital to building a relationship of trust with the consumer, yet only 15% of respondents said they maintained the same price online and in-store.

2. Make it easy for consumers at the shelf to shop your online offerings

If the consumer finds a limited selection on the shelf she is going to pull out her mobile device to see what others have to offer. Few retailers make any effort to direct the consumer to their online store, yet a simple sign with a QR code can easily direct her to your site rather than a competitor.

3. Make it easy to compare products in your online store by providing reviews and side-by-side comparisons

The number one reason that consumers pull out their phones is to get ratings and reviews. In addition to consistent pricing, make it easy for consumers to compare product features and shopper reviews. Consumers are savvy about weighing conflicting opinions – they know that a negative feature for one shopper can be a reason to purchase for another.

Look For Opportunities To Improve The Customer Experience

While there will always be shoppers who “cherry pick” products based on price alone, the vast majority of shoppers consider showrooming a matter of trust. They expect retailers to offer a good deal along with the information they need to choose the product that best suits their needs.

By leveraging the consumer’s mobile device to provide product information at the right time along with a fair price, they can reduce the threat of showrooming and improve the customer experience.

To learn more about the impact of mobile on retail and how to use the right mix of technology components to engage customers and build loyalty, be sure to check out the Mobile Commerce Guide from SAP (registration required).


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About Elizabeth Gaines

Elizabeth Gaines is Senior Director of Marketing at SAP and editor of Business Innovation from SAP. Follow @eagaines on Twitter or connect with her on LinkedIn or Google+.



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13 Scary Statistics On Employee Engagement [INFOGRAPHIC]

Jacob Shriar

There is a serious problem with the way we work.

Most employees are disengaged and not passionate about the work they do. This is costing companies a ton of money in lost productivity, absenteeism, and turnover. It’s also harmful to employees, because they’re more stressed out than ever.

The thing that bothers me the most about it, is that it’s all so easy to fix. I can’t figure out why managers aren’t more proactive about this. Besides the human element of caring for our employees, it’s costing them money, so they should care more about fixing it. Something as simple as saying thank you to your employees can have a huge effect on their engagement, not to mention it’s good for your level of happiness.

The infographic that we put together has some pretty shocking statistics in it, but there are a few common themes. Employees feel overworked, overwhelmed, and they don’t like what they do. Companies are noticing it, with 75% of them saying they can’t attract the right talent, and 83% of them feeling that their employer brand isn’t compelling. Companies that want to fix this need to be smart, and patient. This doesn’t happen overnight, but like I mentioned, it’s easy to do. Being patient might be the hardest thing for companies, and I understand how frustrating it can be not to see results right away, but it’s important that you invest in this, because the ROI of employee engagement is huge.

Here are 4 simple (and free) things you can do to get that passion back into employees. These are all based on research from Deloitte.

1.  Encourage side projects

Employees feel overworked and underappreciated, so as leaders, we need to stop overloading them to the point where they can’t handle the workload. Let them explore their own passions and interests, and work on side projects. Ideally, they wouldn’t have to be related to the company, but if you’re worried about them wasting time, you can set that boundary that it has to be related to the company. What this does, is give them autonomy, and let them improve on their skills (mastery), two of the biggest motivators for work.

Employees feel overworked and underappreciated, so as leaders, we need to stop overloading them to the point where they can’t handle the workload.

2.  Encourage workers to engage with customers

At Wistia, a video hosting company, they make everyone in the company do customer support during their onboarding, and they often rotate people into customer support. When I asked Chris, their CEO, why they do this, he mentioned to me that it’s so every single person in the company understands how their customers are using their product. What pains they’re having, what they like about it, it gets everyone on the same page. It keeps all employees in the loop, and can really motivate you to work when you’re talking directly with customers.

3.  Encourage workers to work cross-functionally

Both Apple and Google have created common areas in their offices, specifically and strategically located, so that different workers that don’t normally interact with each other can have a chance to chat.

This isn’t a coincidence. It’s meant for that collaborative learning, and building those relationships with your colleagues.

4.  Encourage networking in their industry

This is similar to number 2 on the list, but it’s important for employees to grow and learn more about what they do. It helps them build that passion for their industry. It’s important to go to networking events, and encourage your employees to participate in these things. Websites like Eventbrite or Meetup have lots of great resources, and most of the events on there are free.

13 Disturbing Facts About Employee Engagement [Infographic]

What do you do to increase employee engagement? Let me know your thoughts in the comments!

Did you like today’s post? If so you’ll love our frequent newsletter! Sign up here and receive The Switch and Shift Change Playbook, by Shawn Murphy, as our thanks to you!

This infographic was crafted with love by Officevibe, the employee survey tool that helps companies improve their corporate wellness, and have a better organizational culture.


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Supply Chain Fraud: The Threat from Within

Lindsey LaManna

Supply chain fraud – whether perpetrated by suppliers, subcontractors, employees, or some combination of those – can take many forms. Among the most common are:

  • Falsified labor
  • Inflated bills or expense accounts
  • Bribery and corruption
  • Phantom vendor accounts or invoices
  • Bid rigging
  • Grey markets (counterfeit or knockoff products)
  • Failure to meet specifications (resulting in substandard or dangerous goods)
  • Unauthorized disbursements

LSAP_Smart Supply Chains_graphics_briefook inside

Perhaps the most damaging sources of supply chain fraud are internal, especially collusion between an employee and a supplier. Such partnerships help fraudsters evade independent checks and other controls, enabling them to steal larger amounts. The median loss from fraud committed
by a single thief was US$80,000, according to the Association of Certified Fraud Examiners (ACFE).

Costs increase along with the number of perpetrators involved. Fraud involving two thieves had a median loss of US$200,000; fraud involving three people had a median loss of US$355,000; and fraud with four or more had a median loss of more than US$500,000, according to ACFE.

Build a culture to fight fraud

The most effective method to fight internal supply chain theft is to create a culture dedicated to fighting it. Here are a few ways to do it:

  • Make sure the board and C-level executives understand the critical nature of the supply chain and the risk of fraud throughout the procurement lifecycle.
  • Market the organization’s supply chain policies internally and among contractors.
  • Institute policies that prohibit conflicts of interest, and cross-check employee and supplier data to uncover potential conflicts.
  • Define the rules for accepting gifts from suppliers and insist that all gifts be documented.
  • Require two employees to sign off on any proposed changes to suppliers.
  • Watch for staff defections to suppliers, and pay close attention to any supplier that has recently poached an employee.

About Lindsey LaManna

Lindsey LaManna is Social and Reporting Manager for the Digitalist Magazine by SAP Global Marketing. Follow @LindseyLaManna on Twitter, on LinkedIn or Google+.


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Why New Technology Has An Adoption Problem

Danielle Beurteaux

When 3D printing became a practical reality, in the sense that the actual printers became more efficient, less expensive, and more accessible to the average consumer, there was an assumption that the consumer 3D printing market was going to take off. We’d all have printers at home printing…. what? Our clothes? Toys? Spare organs?

That has yet to happen. 3D printing company MakerBot just went through its second employee layoff this year, driven by a market that’s developing much slower than predicted.

That same thinking is in play with a somewhat more prosaic technology – digital wallets. Apple Pay was released this year, as was Samsung Pay. There’s also Google’s Android Pay. During an earnings call, Apple CEO Tim Cook said: “We are more confident than ever that 2015 will be the year of Apple Pay.” But that expectation has yet to be realized, at least vis-à-vis consumers.

Consumers aren’t using any of the digital wallets en masse. According to Bloomberg, payments made via mobile wallets – all of them – make up a mere 1% of retail purchases in the U.S. The reason is that consumers just don’t see a compelling reason to use them. There’s no real reward for them to change from SOP.

Both these instances highlight a problem with assumptions about mass adoption for new technology – just because it’s cool, interesting, and accessible doesn’t mean a market-worthy mass of people will use it.

Who is more likely to use mobile wallets? Emerging economies without a stable financial and banking systems. In those environments, digital payments present a more secure and quicker method for purchasing. These are the same areas where mobile adoption leapfrogged older technologies because there was a lack of telecommunications infrastructure, i.e. many never had a landline phone to begin with, and they went directly to mobile. The value-add already exists. (But there are also security issues, to which consumers are becoming more sensitive. A hack of Samsung’s U.S. subsidiary LoopPay network was uncovered five months post-hack. Although one was expert quoted as saying the hackers may not have been interested in selling consumer financial info but instead in tracking individuals.)

Here’s some interesting data and a good point made: mobile payments are most popular in situations where the buyer already has his or her phone in hand and the transaction is made even quicker than swiping plastic. For example, purchases made for London Transit rides are responsible for a good portion of the U.K.’s mobile payments.

Mass technology adoption is no longer driven simply by the release of a new product. There are too many products released constantly now, the market is too diverse, and the products often lack a true raison d’être.

Learn more about how creative and innovative companies are finding their customers. Read Compelling Shopping Moments: 4 Creative Ways Stores Connect With Their Customers.


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The Importance Of Leadership On Employee Engagement [INFOGRAPHIC]

Charmian Solter

Here at Switch & Shift we strive to illuminate effective leadership practices. We pride ourselves on creating cutting-edge solutions for employee engagement, communication, and creating company culture, to name a few.

Why are these topics so important? Well, according to The Importance of Employee Engagement infographic by NBRI, courtesy of Brandon Gaille, if leadership doesn’t step up and affect change and build trust and engagement, their employees will be busy doing anything but work while on the job! This infographic says it all.


For more on developing more engaged, loyal, and productive workers, see How Empowering Employees Creates a More Engaged Workforce.


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