'Showrooming' -- customers visiting stores to check out products, then buying online via smartphone -- sweeping U.K. retail sector, seen as a threat to traditional retailers, finds Intersperience
March 8, 2012
– British consumers are fast becoming part of a ‘showrooming’ phenomenon sweeping the retail sector in which they visit shops purely to check out the goods before using smartphones to secure cheaper deals online, according to a new report by international consumer research specialist Intersperience.
Dubbed ‘showrooming’, the practice is causing increasing concern for traditional retailers who resent being undercut on prices by online rivals with lower overheads.
Intersperience has researched how UK consumers use mobiles in a retail context as part of its ‘Internet on the Move’ project. Pathway findings indicate that mobile internet has had a major impact on how people shop, with ‘showrooming’ increasingly commonplace.
Paul Hudson, Chief Executive of Intersperience said: “Mobile internet is fundamentally changing shopping habits and altering the power balance in the consumer-retailer relationship. Showrooming marks a wave of change in UK retail and we predict it will become a powerful tide.”
Hudson added: “The onus is on retailers to make instore shopping more attractive, via loyalty bonuses, limited edition goods, price matching or better service. So far mobile internet has mainly driven shoppers online but it could be used creatively to improve the instore proposition. For British consumers, their mobile is now their favourite shopping companion and retailers need to figure out how to respond to that.”
Intersperience found that one in three people in the UK used smartphones to surf the net for price comparisons, product reviews or to check availability of goods over the festive holiday. Almost 20% used their mobiles to call up rival websites and compare prices while they were in a store - and 30% of the people who did so went on to complete an online purchase from a rival retailer while still standing in the store.
The ‘Internet on the Move’ project, which will be released in May, compiled case studies of people’s experiences of using smartphones in stores. One participant commented: “It’s like a friend who helps you with deciding and saving some money with its inputs and perfect suggestion...”
Another participant reported disappointment that an online price check failed tosecure him an instore discount at a major UK retailer - a common experience among participants.
He said: “If they would have given me the camera at a cheaper price or with freebies, like a tripod or cover case, I would have bought it there. I did tell the guy who was showing me the camera... He said he was helpless and can’t bend what is on offer...So I decided to purchase it online.”
The project found that UK consumers still enjoy a physical shopping environment where they can touch and try goods and seek advice, however it also uncovered a growing tendency for people to visit stores as much for enjoyment and research as for commerce.
The latest Intersperience research shows that the UK is fast catching up with trends in the United States where the rise of ‘showrooming’ has prompted a backlash from traditional retailers including Target, the second biggest US discount retailer, which recently wrote to its suppliers asking them to produce more exclusive ‘in-store’ only lines to woo consumers.
Hudson said: “From a consumer’s perspective, smartphones tip the balance of power in their favour as they enter a store armed with up-to-the-minute knowledge of prices, user reviews and special offers. This directly challenges the customer service proposition, particularly with regard to staff training on product knowledge and it also raises very difficult questions for retailers in terms of their responsiveness on price.”