Shopping is easier than ever these days thanks to smartphones and the internet. To get the best possible deals, people simply take out their phones and compare prices online.
Retailers now have to be more competitive than ever so that they can keep up with this intense scrutiny. Even with policies like minimum advertised pricing, there will always be differences in how physical stores operate compared to online stores, which will put them in competition with one another.
One of the biggest problems retailers face because of internet shopping is “showrooming”. Showrooming is when a customer visits a physical, brick-and-mortar store to inspect the item for themselves, but buy from an online competitor instead.
For example, they may sample a new fragrance or try on a pair of jeans, only to put it back on the rack. They then buy the item online at a possibly cheaper price. The retailer will have to entertain the customer only to find that they were never even planning on buying it from them.
Why People Engage in Showrooming
People engage in showrooming because they want better prices than what is on offer. Brick-and-mortar stores tend to have higher prices for the same item than their competitors online because they have to pay for rent, sales staff, interior decorating, and the like. Online stores can afford to sell cheap because they need less capital to operate compared to physical retailers.
Despite the cheaper prices online, customers still want to experience the item for themselves before they buy it. Items like perfumes, for example, cannot be smelled through a computer screen. Instead of guessing, they would much rather confirm their’ purchase’s quality for themselves at a physical store, but buy online instead.
Retailers Can Avoid Showrooming Behavior
Showrooming is unfair to the retailer as it translates to lost revenue. Fortunately, there are some clever strategies to fight it. Having a good, charismatic sales staff, for example, is still a sure-fire way to close a deal.
Putting up a website for the store and offering perks like in-store delivery of online orders is also a tactic that has been met with great success.
You can beat online competition by going head to head with your online competition. If showrooming is just about better prices, you just have to justify your higher costs by providing a better shopping experience to your customers.