Showrooming and Webrooming – Hurting or Helping Retail?

(AdExchanger, 2012)

First, a couple definitions.

Showrooming: Looking at a product in a retail store, and then shopping for and buying the product online.

Webrooming: Researching products/retailers online, and then going to the retail store to make a purchase. 

During the last few years, retailers have worried about showrooming, as more and more shoppers utilize their mobile devices to perhaps find better deals elsewhere, including Internet retailer sites. However, many are now questioning the assumed negative impact of such consumer behavior. When shoppers use their mobile devices in a brick-and-mortar store, are they really taking their business somewhere else, or could such devices actually be helping the traditional retailer – especially if retailers facilitate, instead of discourage the digital shopping companion?

A recent study indicated that mobile devices had an influence on 19% of in-store business/sales last year – which translates to a retail value of about $593 billion. When transactions on all digital devices are considered (PCs), the value increases to more than $1 trillion. Further, based on the current rapid growth rates, it is predicted that the influence of digital devices on business will reach $1.5 trillion by the end of this year – or about 50% of in-store sales (Deloitte Development LLC, 2014).

While some consumers certainly participate in showrooming, there is evidence that just as many consumers, if not more, are doing what is now called webrooming. It appears that a growing number of consumers are finding their product and retailer research information online, and then heading to the off-line store to make their purchase (Gustafson, 2014). A recent study also showed that the sales conversion rates go up when shoppers utilize digital devices (mobile or otherwise) before or during their shopping activity. In fact, according to the study, the normal rate of conversions for in-store sales when no digital devices are used is about 60%. However, when digital devices were utilized prior to or during shopping, the conversion rate jumps to as much as 78%. When digital devices are used both before and during the in-store shopping process, the conversion increases to an impressive 84% (Deloitte Development LLC, 2014).  

The point is that brick-and-mortar retailers should not worry about, or discourage the use of mobile devices in their stores, as many shoppers are simply using the devices to gather more information, see what others are saying about a product, and so on. Instead, retailers should embrace the growing mobile digital reality, and work to integrate their in-store and online marketing activities. Providing free Wi-Fi within the store to allow shoppers to easily browse online would be a great start. Additionally, why not add some in-store signs suggesting that shoppers go online to find additional information about a product, or read product reviews. Enhanced digital access to aid in the shopping process is what an increasing number of consumers are looking for – so, why not give it to them? Such activities can build customer loyalty, and provide a competitive advantage over the retailers that still have sad signs up that prohibit shoppers from using smart phones in the store? It only makes good business sense to be on the digital offensive side – and not to keep trying to play digital defense!

References

AdExchanger. (2012, May 4). Showrooming. Retrieved from AdExchanger: http://www.adexchanger.com/comic-strip/adexchanger-showrooming/

Deloitte Development LLC. (2014, April 28). Deloitte study: digital influences more than $1 trillion in retail store sales. Retrieved from Deloitte: http://www.deloitte.com/view/
en_US/us/press/Press-Releases/e051ee4e0e395410VgnVCM1000003256f70aRCRD.htm

Gustafson, K. (2014, April 28). The $1.5 trillion opportunity retailers overlook. Retrieved from CNBC: http://www.cnbc.com/id/101611505