Consumers have always been a pretty confusing bunch from a retailer’s perspective, but now with access to technologies that can enable them to visit five rival stores to compare prices while they are physically stranding in yours, life is even harder for retailers. Andy Boothroyd of HPS Group looks at the growing phenomena of ‘Showrooming’ and ‘Webrooming’ and how the retailer can manage that challenge.
The retail world is full of buzz-terms we hear being used at the boardroom table, at conferences, from analysts, and in blogs. Of particular note are the terms “showrooming” and “webrooming”, both of which are causing grief for several retail marketers, to varying degrees. This guide provides some clarity on these two terms, some valuable data on the audience engaging in these practices, and how more personalised customer engagement is changing the game for leading retailers.
Showrooming occurs when a shopper visits a retailer’s bricks-and-mortar store to review a product and then decides to purchase the product online. They essentially treat the store like a showroom where they can see and feel the product up close, then go out and try to find the best price online. Webrooming is the opposite scenario where a customer does their research online then goes to a physical store and makes a final evaluation before making a purchase.
Merchant Warehouse’s research found that webrooming appears to be trumping showrooming and that is equally true among men and women. While three-quarters of men (75 per cent) webroom, just over half (53 per cent) showroom. Similarly, women are more likely to webroom (63 per cent) than showroom (40 per cent).
Let’s have a look at some of the reasons…
- 47 per cent don’t want to pay for shipping
- 23 per cent didn’t want to wait for the product to delivered
- 46 per cent like to go to a store to touch and feel a product before they buy
- 36 per cent will ask the store to price match a better price found online
- 37 per cent like the option of being able to return the item to the store if needed.
“Although many physical retail stores are suffering due to internet-focused buying tendencies, it’s not too late to turn things around,” writes Merchant Warehouse in a company blog post. “By improving the in-store shopping process, retailers can convert showroomers into real customers and take advantage of the webrooming effect. When making these changes, it’s best to unify all the relevant store, mobile and web channels. This will create a continuity and flow for each customer experience.”
Omnichannel shopping has come of age. Sophisticated shoppers no longer have a preferred way to shop, they mix and match how they research, buy and receive their purchases to create ultra-personalised shopping journeys.
After several years of getting to grips with all of the different ways modern shoppers can browse, purchase and collect their goods in an ever-evolving omnichannel world, a new breed of supremely confident shopper has come to the fore. John Lewis have recently created the term “Master Shopper”. This is someone who knows how to find the right product, at the right price, available how, when and where they want it, in the ultimate personalised shopping experience.
The omnichannel Master Shopper has learned to combine channels to achieve the optimum shopping experience. Two thirds of John Lewis’ customers use both physical shops and online channels and the number who bought from both channels increased by 9 per cent. They expect this number to grow in the coming years. Collection options are also increasingly flexible, with click-and-collect now the fastest growing method, accounting for over half of online orders.
Considered purchases such as white goods, furniture and computers take on average seven or eight different interactions. 65 per cent of customers start their shopping journey on a smartphone and 61 per cent continue on PC/laptop. Nearly 20 per cent of customers buying a computer have more than ten interactions during a buying journey. An average of three of those interactions involve online research on johnlewis.com or on other websites, indicating that when buying technology, Master Shoppers have a keen eye for the latest models and the best prices.
This emphasises the importance of having joined up, consistent messaging across all channels and touchpoints.
The store is changing from a place to transact, to a place where a customer’s loyalty and relationship with a brand can be significantly enhanced. Customer engagement is becoming a key part of the process, with advice, demonstrations and problem solving as a crucial element of delivering optimum customer satisfaction. Indeed, John Lewis’ managing director Andy Street recently stated “the role of the store is to inspire” – something that’s difficult for most websites to do. This may also explain the growing trend for pure play retailers to open physical stores. Big players such as Amazon, Google, BirchBox, Bonobos and Warby Parker have all successfully opened physical stores where customers can get hands on advice, product demonstrations and support and on the flip side, the brands get the opportunity to engage and interact with their customers on a more personal level than they can online.
Meanwhile, some retailers that already have established physical and e-commerce stores are working to further bridge different shopping channels. For example, in the US there’s Macy’s, which in addition to offering typical omnichannel services like click-and-collect, also lets its customers browse the inventory at their local store on the Macy’s website.
In the physical world, the ability to spot the right kind of buying signals at the end of an involved customer interaction and the knowledge of how to convert the opportunity into a short walk to the cash register, are vital components of any successful retailer's response to online shopping. With proper sales staff training every customer encounter, even if it involves a product return, is an opportunity to convert to a valuable sale.
This is where the successful brands and retailers are stepping in to take advantage of that opportunity to close the sale through engaging and exciting sales activity. The last nine feet of the sales process is becoming more important than ever.
Andy Boothroyd is head of business development at HPS Group.