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Bricks versus Clicks: Four Ways to Convert Showrooming Opportunities

By Mike Romano, mromano@soundbite.com

Recently ShopperTrak reported that during the 2012 post-Black Friday week retail foot traffic increased 3.7% over last year. Larger chains like Wal-Mart, Target and Meijer have done an excellent job this holiday season combining their brick-and-mortar stores, online, and mobile channel into a seamless customer shopping experience. Other retailers with a weak multichannel communications and commerce strategy are seeing a bit of coal in their stocking. These channel laggards are susceptible to being out-marketed and exposed to revenue loss due to consumer shopping behaviors such as showrooming. And where are their lost sales going? According to a poll conducted by Harris Interactive between Nov.27 and Nov. 29, querying 2,249 adults, Amazon.com is the online benefactor cited by 57% of the respondents.

This trend of consumers viewing merchandise at a brick-and-mortar location, making cost comparisons on their Smartphones and tablets in store, and then going online to finish the purchase is growing. It is estimated that showrooming will have a big impact this holiday season, and may influence up to $1.7 billion in 2012 holiday retail sales. One-in-five consumers are now showrooming, according to new research by Aprimo/Teradata and Forrester Research. This trend can’t be ignored, as 96% say they plan to use their smartphone to research prices the same way or more in the future.

Back in September, Deloitte issued its their forecast for the 2012 holiday season, which anticipated retail store sales influenced by customers using their smartphone for research, price comparing and other activities will account for 5.1%, or $36 billion, during the holiday season this year. Deloitte went on to say that consumers who use smartphones as a showrooming tool are 14% more likely to make a purchase in the store than those who do not use a smartphone.

So what can retailers do to turn a potential bad showrooming experience – where the customer comes to a brick and mortar store to see a product before buying online elsewhere – into a sale? Here are four ways retailers can help capture prospective customers who are conducting product research, convert serious lookers into buyers, and win the showrooming challenge:

Harness the power of multichannel: Retailers should leverage the power of the mobile phone and tablets through a multichannel strategy. A customer browsing at a brick-and-mortar location would suggest that they are conducting in-person research, but because they are likely carrying their smartphone, the opportunity for showrooming is presented. An IAM survey found that 73% of consumers say they have used their mobile phone in a store. Mobile websites make it easy for consumers to compare against your competitor – while in your store! Take this opportunity to send location-based messages via text, email, or push notifications to their mobile phone. Retailers commonly use QR codes or text for info codes to drive traffic for more information to a mobile site they control. Consumer adoption of QR codes has pushed past the 60% level – transforming QR codes from a one-time fad into a viable solution that marketers should integrate into their mobile strategy.

Don’t try to fight showrooming: A number of retailers have recently launched their own mobile apps to create incentives for in-store browsing and subsequent purchases. The argument can be made that apps make a shopper’s experience richer, but showroomers are savvy consumers and apps may be skeptically viewed as an attempt to push branded content and products as consumers seek more complete and unbiased information. Mobile websites make comparisons easier. What better way to get that special holiday feeling than to have consumers handling a product in your competitor’s store while buying it via their Smartphone from your mobile website? The sweet smell of victory. If you don’t have this particular strategy in place today – then it’s happening to you as you read this.  

Get creative with “point-of-decision” mobile marketing tactics: If a customer is comparing prices, make it plainly obvious via both the in-store and online channel that you will meet a competitor’s price. If price match does not provide enough differentiation, go beyond your competitors by offering some added value options like a free 12-month warranty, no hassle 90-day return policy, or even better, some loyalty recognition for those retailers that offer such a program. This may tip the balance in your favor. How about offering the customer a special promotion when they enter the store for a discount on that extended warranty, or a cross-sell offer based on previous behavior? It’s too late this year if you have undervalued the power of a mobile device in a consumer’s hand, but planning for 2013 is in full swing, so implement or upgrade your existing mobile presence or sales will continue to walk out the door.  

Arm your associates with knowledge: It’s OK, you can admit it; your Gen-Y sales associate knows more about mobile and how to optimize the mobile experience than you do.  Just swallow your 20 years of marketing experience pride, and embrace learning to connect with your mobilized customer. Learn how to empower store associates to take customer service one step further as brand, campaign and information ambassadors. Associates can point showroomers to in-store QR codes that provide positive reviews or side-by-side comparisons which ultimately provide them with the research they are looking for on their mobile phone. That one simple interaction may save that sale.

Showrooming is not a shopping fad that will be disappearing anytime soon. Retailers need to embrace mobile so sales don’t walk out the door this season or all year round.

To learn more mobile marketing strategies to drive in-store, online and mobile sales this holiday season, watch my presentation from our recent webinar, Mobile Marketing Holiday Strategies or contact me at mromano@soundbite.com.

Mike Romano is SVP mobile sales and services, SoundBite Communications.


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