As we enter the 2014 holiday season, retail news outlets are latching on to dramatic headlines highlighting the risk of showrooming – the act of checking prices on a mobile device in a store and then purchasing at another retailer. Yes it’s true; customers use their mobile phones to compare prices in-stores. However the behavior of shopping multiple stores to find the lowest price is nothing new. My grandmother often "showroomed" a bag of peanuts at the farmers market just to save a few cents. I suspect this behavior has been occurring as long as humans have been bartering goods.
While the behavior is not new, mobile phones have enabled customers to compare prices immediately across a vast set of digital retailers. As mobile phones afford customers greater choice in-aisle, showrooming has instilled fear in legacy retail organizations who quickly realized they no longer completely control the experience in their stores. At first, retailers responded with force by removing Wi-Fi, which in a world with rich cellular connectivity did little to curb showrooming behavior. Today retailers are reacting to showrooming by providing margin-eroding offers in-aisle. In the future, advanced retailers will begin to embrace showrooming, using the signals from price-checking on mobile phones (either by observing behavior or using retail store analytics) to offer greater convenience and rich experiences at the customer’s moment of need.
Along with price checking in your store, customers will engage in reverse-showrooming while shopping in your competitors’ stores. Savvy retailers will build a showrooming strategy that ensures price parity, optimizes the shopping experience in-store, and creates a showrooming experience for shoppers while visiting a competitor’s store. It’s possible that reverse showrooming can drive incremental revenue.
The truth about showrooming is that the behavior is here to stay. In total, 9% of U.S. customers will visit a store and then purchase elsewhere after comparing prices on their mobile phones. To learn more about showrooming rates by product category and to get the full list of recommendations for retailers, please download the report “The Truth About Showrooming”. I look forward to discussing the results with you through Forrester’s Inquiry process.