Here’s a statistic retailers should find staggering: 57 percent of people test products in stores, walk out the door, and purchase the same products on Amazon.com.
Amazon’s the biggest and baddest online retailer, and actively encourages the practice. But also imagine all the people trying on shoes at shoe stores and then buying them from Zappos, for instance.
If you’re in retail, you’re already aware of showrooming: When shoppers examine merchandise in a brick-and-mortar store without purchasing it, then shop online for a better value. In fact, many showroomers purchase online while in the store using their smartphones. The phenomenon, in fact, is said to have been behind Target’s decision to discontinue carrying the Amazon Kindle; and is of massive concern to retailers like Best Buy, which estimates that as many as 40 percent of the people who come through its doors have no intention of buying anything — from them, anyway — while there.
The practice has become so disruptive to retail profits that some have fought back in not-very-smart ways: An Australian company, for instance, made headlines last month for charging looky-loos in their store a $5 fee for “just looking.” But showrooming is here to stay, and everybody’s looking for the best way to combat it. How can you be smart about dealing with showrooming in your own business?
Well, first of all, you could take a cue from Amazon and Zappos themselves.
Amazon and Zappos are popular with consumers because they offer great customer service, let shoppers post and peruse scads of user reviews before they buy, offer low-cost or free shipping, and often can sell items cheaper by nature of their online business models.
The last two reasons are things bricks-and-mortar businesses must consider from a bottom-line standpoint. And smaller businesses can’t compete with Amazon on pricepoint alone. Customer experience and loyalty, however: These are things retailers have more control over.
For example, I rarely buy books from bookstores anymore, preferring to order from Amazon or purchase e-books directly from my Kindle. But until recently I made one exception. A handful of weeks a year, my family spends time in Lake Tahoe. And up until it closed last year, I used to religiously visit the Bookshelf in Tahoe City and browse and shop to my heart’s content.
Why? The staff was friendly, knowledgable and helpful. There were magazines I couldn’t find elsewhere. And the best thing was the Staff Picks: Book review cards posted next to the books the highly literate and diverse staff recommended. I almost always got several of those. In short, I got a personal experience I couldn’t get online, but still enjoyed the benefit of user reviews! Though the Bookshelf was an unfortunate victim of its place and time, it had the right idea.
What else can you do when you know the new world order is that customers in your store will be checking their mobile devices?
- Embrace it! Determine ways to use mobile marketing to engage with smartphone wielding customers from within the store. Can you offer a Foursquare check-in special, for example? Create a loyalty program using a phone app? Post QR codes to give people more information on the product, or allow them to view a demonstration of its use? Use geolocation and opt-in Wi-Fi access to push in-store, real-time coupons to connected devices?
- Use social media. Build loyalty by keeping customers updated, valued and engaged when they’re not in your store so that they keep coming back.
- Offer (and publicize) post-purchase support to those who buy from you. Social media’s a great way to do this. So is an old-fashioned note in the mail. Whenever I shop at Nordstrom, for example, I’m always pleased to receive a note from the associate checking on my satisfaction and alerting me to future trunk shows, etc.
- Post product reviews onsite so that customers are less tempted to check online reviews. Use staff reviews, critic or analyst reviews, or make a practice of soliciting customer reviews online and then posting them onsite.
- Enhance the in-person shopping experience with amazing customer service. Go the extra mile for your customers and they are much more likely to return the favor by buying from you. Empower salespeople to provide a personal touch that online self-service can’t. Make it inconceivable that they’d leave without purchasing.
- Hold events. Take advantage of the fact that your business is a storefront and offer tastings, local fundraising events, after-hours loyalty sales, chamber mixers or whatever else may be appropriate for the type of retail business you have.
- Indulge instant gratification. If you have an e-commerce website, allow customers to order online and pick up in-store the same day. If you don’t have an e-commerce website, consider getting one.
- Finally, maintain competitive pricing. If this can’t be done on a storewide basis, at least price aggressively some popular items, or price-match guarantee when asked.
Combatting the challenge of showrooming requires an integrated online/offline, multi-touch engagement experience that delights your customers. Are you ready?