Written by Katrin Diederich and Isabel Couceiro
This topic just came up to my mind when I was browsing (physically) for some stuff for my toddler at a Baby store. I started to think that it could be a good idea to buy a new pram, as the one that we own is too weak for my super tall (and heavy) 2 years old boy`s actual weight and I will really need a stronger one to participate in the “Kids for run”. If I want to finish the 5km walk, of course… Probably because I was looking confused while staring at so many options, a lady from the store came to rescue me. The first question she asked me was “Have you already researched online”? Nope, the idea of buying a pram just came up to my mind while I was in the store. That question surprised me and really made me think that the way people buy (and sell) is changing as faster as our internet connection is supposed to be.
There is a new phenomenon in consumer behaviour that has emerged in the last years and that now appears in many discussions and research papers; the so-called “Showrooming”. Kirthi Kalyanam and Andy Tsay describe Showrooming in their paper as “using the presentation and services offered by a brick-and-mortar channel but making the purchase in an online channel”.
If you take the time to talk to sales persons, let`s say from electronics or appliance stores, you will hear a list of complaints about how people in these days are messing up their business doing this “showrooming” thing. They (the consumers) spend hours walking around, pressing buttons, asking questions and in some way wasting sales people’s time. These consumers are carrying their smart phones in their hands, scanning bar codes, comparing features and prices, for, in the end, walking away without spending a single cent, leaving the sales person heartbroken.
Although this tendency has started a couple a years ago, physical retailers have needed some time to adapt to this new phenomenon and to fight back by developing a strategy to deal with this new reality? Some of the biggest retailers in Australia, as Toys”R”Us and Officeworks introduce the “price match policies”, aiming to stop, at least, this consumer behaviour. http://www.toysrus.com.au/price-match-policy http://www.officeworks.com.au/information/policies/lowest-price-guarantee
But others are still struggling with their consumers’ “nasty” behaviour without having a clue about what do. These companies are trying their best, or at least they think it is, to compete with pure online stores with regard to price, product and promotion. In the end, brick businesses are always going to carry the disadvantage of the store costs to deal with it but they can change the game by learning how to leverage their higher proximity to the client.