Tips on overcoming the latest challenge facing brick-and-mortar retailers.
By Maria Bouselli
It’s a scenario many retailers across the country are facing every day: a customer enters a store, browses the selection while soaking in the ambiance, is informed of the various styles’ features and benefits and, perhaps, even gets fitted by a trained professional. The customer decides which pair he or she likes, only to whip out their smartphone to compare prices and later purchase the item online or at a competing retailer for a lower price.
This act has been dubbed “showrooming,” which basically sums up what many stores have become for those shoppers seeking the lowest price possible regardless of whether it’s deemed taking advantage of those provided services. Bob Schwartz, CEO of Eneslow Pedorthic Enterprises in New York, notes that showrooming is a “disappointment” and is becoming more common. In addition to a lost sales opportunity, he says it slows down the entire energy inside the store. “More and more people are [getting] the full experience and then say they’ll get back to you or that they’re not ready to buy. Others are blunt and tell you that they’re going to buy it online,” he says. Making matters more difficult, James Dion, founder and president of Chicago-based retail consulting firm Dionco Inc., says Amazon went so far as to offer customers a $5 rebate on items they scanned at brick-and-mortar stores through its mobile shopping app.
Like it or not, technology has put the power into consumers’ hands, and that’s only going to become more prevalent as tech-savvy younger shoppers grow up attached to such devices and older consumers increasingly get up to gadget speed. “It’s [mostly] the younger generation doing it, but as baby-boomers get more involved with that technology, we’ll see them doing it more as well because people want to save money,” confirms Joe Gradia, co-owner of Hawley Lane Shoes in Norwalk, CT. “And having the ability at their fingertips makes it easy.”
What’s a brick-and-mortar retailer to do? Edith James, owner of Comfort Shoe Specialists in St. Louis, says she simply does not stand for customers constantly on their phones while in her store. “I instruct my staff, if they get the feeling that a customer is just using them, to ask, ‘What are you planning to do?'” James says if the response is they want to order the item online, she instructs her staff to stop helping immediately. “We can’t afford to be fitting people and paying hourly wages for that kind of nonsense,” she explains. Schwartz instructs his employees not to let showrooming customers ruin their positive outlook, and to “communicate to the customer that [the sales staff] are aware of what they are doing and request they do it elsewhere.” Gradia goes a step further by featuring in-store “signage that shows [how the sales staff] has done customers’ homework for them and how it is an advantage to purchase [in store].”
While these are reasonable enough tactics it still may not result in a sale and could limit the chance of the customer’s return. That’s why Matt Lucas, president of Luke’s Locker, a specialty running chain with various Texas locations, always gives his customers the benefit of the doubt—at first. “There are situations when customers will come back and they do want to remember what they tried on, so I don’t want to make the wrong assumption,” he notes. “However, it’s hard to give information to ‘repeat offenders.'” To that end, Lucas has heard of some running specialty stores debating whether to charge a service fee for the half-hour fitting process many provide, which normally entails a treadmill run and the use of several cameras for gait analyses. The idea being the customer would be charged for the fitting, but would then be given an equal credit if he/she purchases shoes in the store. Lucas isn’t sure, however, if this is necessarily the right path. “I would not be comfortable doing that right now,” he says. “I think that big-picture wise, the expectation of our target cus tomer is that they are willing to pay and support a local retailer.”
In the meantime, offering top-notch customer service seems to be the most effective way to combat showrooming. A recent Nielsen survey reports 69 percent of respondents believe purchasing items in a physical store is the most reliable method of shopping, with 77 percent stating it’s also the safest—proving, in part, that honest service and valuable assistance can help convert browsers into buyers. “You have to train your team to have the most knowledge about the products that they sell,” offers Perry Miroballi, co-owner of Miroballi Shoes in Orland Park, IL. “And [I tell my] team to build a person-to-person relationship with their customers, which leads to building personal clientele.” Doing so makes it simply harder to say no. Miroballi also keeps in mind that convenience plays a part in customers turning to online shopping. “We have expanded hours, [created] a more flexible return policy, and make sure we have sizes in stock,” he says. “We want to raise the level of consumer experience and make it unmatchable.”
While upping the ante on service, retailers must also maintain competitive pricing in order to help combat showrooming. Dion compares showrooming to cognitive dissonance, more commonly known as buyer’s remorse. “People used to feel buyer’s remorse over large purchases [such as] purchasing a home,” he explains. “Today, people are feeling cognitive dissonance over $2.99 items because it’s so easy to do a comparison.” And customers notice even the most miniscule differences in price. “In the past we used to be able to charge $2 to $5 [more] to cover costs,” Schwartz says. “Now you can’t even charge $1 more because the competition is so great.”
As such, an increasing amount of retailers are willing to match the price customers find online—so long as it’s a reliable quote. “Some say, ‘I saw this on the web’ and show the print out,” Gradia offers. “We look into it and see if that online store might only have a couple sizes left and are trying to get rid of their inventory. If the product is really on sale, we’ll definitely honor it, but if there are only odd sizes left, we can’t.”
Of course, showrooming might not be as viable a shopping strategy if distribution policies were more selective. “We always want to carry products that are more exclusive than those that are widely distributed,” Lucas says. “We’re always excited when brands limit styles to our retail specialty category.” He cites Nike’s new Structure Triax as a successful example.
Dion warns retailers of buying from over-distributed brands: “I don’t care how much you up your game as a retailer, if you are buying products from brands that are (over distributing) then you’re in trouble. But if you are buying from brands with good ‘minimum advertised price’ policies and brands that protect themselves by selling only to first-quality retailers, you’re going to be OK.” Paul Muller, vice president of merchandising for the Foot Solutions chain, agrees: “We want to know what [the brand’s] Internet and pricing policies are first,” he says. “Independent retailers need to ask those same questions.” James even goes so far as to not partner with brands that sell to consumers direct via their own sites as well. “We don’t need their help to put [us] out of business,” she says.
Along those lines, another way retailers can combat against showrooming is to create a strong online presence of their own. “You must be on the web selling today,” Dion maintains. “If you want me as a customer, you can’t tell me to show up only from 10 am to 5 pm during the week. You have to give me the ability to shop whenever I want.” While some retailers might find an ecommerce to be too much of an investment, Dion assures that hiring a company to create one for a couple thousand dollars is worth it in the long run, and the best way to start this process is by talking to other independent retailers. “When you see a site you like, call your peers,” he suggests. “The only people that you can really trust are each other.” Along those lines, Eneslow’s Schwartz suggests that other independent stores nearby, such as family-run restaurants and apparel boutiques, could also support each other by hosting street events to promote shopping—and purchasing—local.
In short, there are steps that retailers can take to turn that showroom shopper into a paying customer. If that customer has made the effort to come into a store, a retailer must find a way to close the deal and not lose a sale for a measly few dollars less. The sales staff must make that entire in-store shopping experience so pleasant and the service so good that the customers feel indebted to reward that store with their purchase—even if it happens to be for a few dollars more. Because, as most retailers and vendors agree, the showrooming consumer is here to stay. “This is a fact of life. It’s one more thing added to the list [of challenges],” Schwartz says. “But I wouldn’t stop my business over it. I think the most important thing we can do to combat it is to provide a unique experience for customers to say, ‘I couldn’t get this anywhere else.'”