Does Showrooming Mean Death to Your Business?

How would you like to be charged to get advice from an assistant in a camera shop or a PC reseller? Or if you went to a car dealership and asked to test drive one of their models, and they said you must pay R200 first? Or if you went to buy some clothes, shoes or even perfume, and they charged a sampling fee before you even started? My immediate reaction would be to be outraged – and vow I would never go back again.

These may sound like ludicrous, maybe even offensive schemes, but they are being considered by many retailers who are experiencing a growing problem which has been dubbed “showrooming.”

Showrooming is when customers want to shop for something, go into a store, try it out, ask questions and advice from the staff… then check the (usually cheaper) price online as they walk out. It really seems like a massive problem for all bricks and mortar businesses, and there have been many businesses that have even gone bust because of this. (In a cynical gesture, the staff at UK-based camera chain Jessop’s even put up a sign on their now-closed store windows saying “The Staff at Jessop’s would like to thank you for shopping with Amazon. Dodging tax 1% at a time.”)

This is neither a new phenomenon, nor is it going to go away. We used to call it “shopping around” or “comparing deals,” but it has become a lot easier now because of the internet and smartphones. There are already a number of industries that have been decimated by the power of the internet and by online stores. Whether we look at music, book and media publishing, toys and shoes, travel agents and estate agents, many industries have changed the way in which they do business with customers. Very few have made the transition without considerable pain.

If you look at it from a customer’s perspective, shopping online offers a number of advantages. First, there is the convenience of not having to get into your car and spend time shopping around at a number of different stores, perhaps even at a number of different malls. Second, you inevitably find cheaper prices that typical physical stores, (with high overheads: premium rental, lots of staff, stock in storage, and more,) cannot compete with. Third, the risk of buying something unseen has been mitigated by customer comments on the internet and in the social media. Indeed, many companies like Amazon encourage people who purchase products to review them, and can also make recommendations based on what you have indicated you like.

Thus, while personal service experiences may not always be part of online purchases, this is mitigated by the speed, convenience and savings benefits.

So how do you respond to this attack on your bricks and mortar business? Solutions may appear hard to implement, but often it is not about matching what happens online.

When I first saw the discussion about showrooming it looked like a no-win situation for bricks-and-mortar retailers. Should they charge for try-outs, samples, test-drives and good advice? (And perhaps take this fee off when their customers actually buy?) Should they ban customers who do it? Can they get “exclusivity deals” with their suppliers? Should they develop their own online and smartphone/mobile strategies?

And then it suddenly struck me… Online stores are just another competitor, albeit a competitor that offers much better prices and greater convenience. Therefore, businesses threatened by these new competitors should do what they have always done to attract and keep customers. They may choose to imitate and follow a strategy of “if you can’t beat them, join them,” but they must also find ways to offer even better value to customers and prospects so they are not tempted to go the well-known, established and trusted websites.

The best way to do this is to offer them personal and memorable experiences that simply cannot be imitated on line. I like the convenience and simplicity – and the prices – of buying books from Amazon.com, but as a book lover I can’t resist browsing in my local bookstore, smelling and feeling the books, and even grabbing some not-inexpensive coffee and cake while I’m there. But when I do buy the book, I don’t care that it’s 10% more expensive. What was important was just being there.

Real store experiences can or should be…

Personal: involving human contact as opposed to “web-bots,” and also offering bespoke or customised products. In today’s depersonalised and impersonal world, customers are looking for authenticity. Warmth, empathy, caring and enthusiasm are essential, as is your ability to know stuff about your customers.

Entertaining: surprising, playful, thrilling, “top secret,” humourous, or even sexy. There is so much you can do here, even on a limited budget, (including live demonstrations, special events, road shows, and an attractive or unusual physical space or location.) You can design special themed events, and even give away memorabilia to customers to remind them about the experience.

Engaging: let them learn something new, explore, offer their views, connect with each other, or even take a role in the show. Also try to involve as many of the five senses as you can, and create and emotional experience that hits them between the eyes.

Boundary-Breaking: beyond the expected, innovative, remarkable, or maybe even outrageous. It can include where and how you promote your business, touching on taboo subjects, (a beautiful young lady once asked me if I wanted a “Chilly Willie,” which turned out to be a chocolate and chillie ice cream,) or doing the opposite of what others are doing. One YouTube video shows a business where, instead of trying to make their website look like a store, they have made their store look like you are walking into a website!

Value-Creating: since customers are giving up the advantages of online shopping, what else can you offer that makes the sacrifice worthwhile?

Maybe it’s just my age, but there are lots of things I just won’t buy online, and the companies that want to sell them to me better be ready for it – or lose my business.


Back to Articles and Resources.