How A Great Customer Experience Can Overcome Showrooming
The disruptive effects of the now ubiquitous smartphone are being felt across numerous industries, but traditional ‘brick and mortar’ retailers are feeling a substantial amount of pain due to the “Showrooming” phenomenon.
Increasingly, consumers use their smartphones to find competitive prices, reviews and other product related insights while in the store and frequently just use the brick and mortar retailer to see and touch the item before purchasing it online, hence the nickname showrooming.
With recent market research indicating that more than 53% of in-store customers abandoned at least one purchase due to online insights obtained via the smartphones (Source: Interactive Advertising Bureau report “Mobile Phone Shopping Diaries May 2012), retailers need to explore new ways in which they can try and reverse this burgeoning trend of store visitors walking out without buying anything due to smartphone supplied information.
Indeed, my own recent showrooming experience is a great example of how brick and mortar stores can compete in a world where showrooming is a constant threat. I live in Asia and was recently visiting San Francisco on business, and knew I could get a better deal on a high end camera kit in the U.S. Before I left I had conducted a lot of online research and found five stores near my hotel that had the camera and lens I wanted. I visited each store and quickly realized that one store provided a superior customer experience.
The store not only had a lot of cameras on display but information kiosks, a lot of light and other aspects that welcomed me. Once inside I was approached by an extremely knowledgeable sales person, who not only knew about the kind of camera I wanted but had been trained to ask about customer needs. After a discussion he not only showed me the camera I had been thinking about, but also explained the virtues of an additional lens which would be more suitable for the kinds of photos I want to take.
Of course, the additional lens was relatively expensive. Classic upselling, but I didn’t mind because he was right—my photography needs would be better served by the second lens. So I immediately used my smartphone and found other area merchants, as well as online offers. Another store a couple of miles away was selling the same lens for $350 less. After a discussion with the salesman, we agreed on a price for the second lens which was $50 higher than the bargain down the road.
I was reminded of my camera purchase and the great customer experience when reading a new report by Bloomberg Businessweek Research Services on the increased importance of retailers using data, analytics and real time processing to provide a better experience to their customers.
Williams Sonoma, Chico’s and other leading retailers mentioned in the report have learned that harnessing data about customers, products, trends and markets can be analyzed in real time to produce insights that lead to a great customer experience. And, of course, a great customer experience is a great catalyst for higher revenues and profits. To read the report, click here.
I have seen how other retailers, not just the camera store in San Francisco, that gather and analyze information about each customer and then use that to offer the perfect solution to a customer need or want are delivering a delightful customer experience. The local bookshop branch of a Scandinavian chain has successfully countered the Amazon challenge by providing a better experience by exploiting both technology and its local presence.
When I want to order a book, I can go to its online site, select and pay for what I want and pick it up the same day at the local bookshop, on my way to the office or when out doing other errands. The great customer experience of having the goods when and where I want them can be a strong differentiator for a brick and mortar retailer, thanks to the combination of real time processing of data and fast analytics.
I would welcome hearing your thoughts on ‘Showrooming’. Do you have any examples of retailers you have engaged with that are embracing this new trend in a positive fashion?