Webrooming vs Showrooming: How the Consumer Stole Christmas

Posted by Victoria Elizabeth 25 Oct 13

shutterstock_200530838While marketers in both on and offline retailing are scrambling to understand how consumers are behaving in time for the holidays, it seems that the only one really winning in this scenario is the consumer.

Whether savvy shoppers are using their mobiles to price-compare or purchase online while in-store (showrooming), or they are browsing online with the intention to purchase in a physical store (webrooming), it seems that in either case the customer has all the power, and is in charge of their own conversion path. This has inevitably left many marketers feeling quite powerless and ill equipped to handle this shift in control over conversions.

This, if you haven’t noticed by now, has been BIG news in digital marketing and retail since last Christmas, especially in the US and UK. In particular, the UK has been plagued this year by disconcerting reports on the decline of the British high street, the inclement weather pushing people to shop online, and the lack of incentives for a customer to want to deal with long queues and busy high streets. But webrooming also has a part to play here, because it’s not just physical retailers who are disgruntled by showroomers. Consumers who spend lots of time browsing, price comparing and opening up lots of new baskets across websites, are behaving in a way that makes attribution almost impossible to allocate and confuses conversion paths. This, together with some statistics stating basket abandonment rates for retailers average 72.4%, makes things even more complicated. Webrooming not only makes the customer journey more difficult to track, it makes it hair curling to determine the ROI of digital marketing spend when customers are not completing a purchase where it started.

However, this post provides some facts and insights for how retailers can bring a relevant experience back into physical shopping, while strengthening the power of the consumer at the same time. And this is where an omnichannel strategy comes to play. Whether retailers and etailers choose to believe it or not, they are living in an omnichannel world, with omnichannel customers, and if they aren’t thinking this way already, they definitely aren’t seeing the trees for the forest. 

General Facts on Show and Webrooming

Here are some general facts about M-shopping and showrooming habits from Columbia Business School's September Report, which surveyed 3000 M-shoppers from the US, UK and Canada:

  • There are 5 types of M-shoppers
    • Traditionalists - (30.2%) Prefer in-store shopping experiences
    • Experience-Seekers - (31.7%) Value the best experience, not just price
    • Price-Sensitives - (19.4%) Don’t plan, but always opt for deals
    • Savvys - (12.6%) Calculating, but persuadable
    • Exploiters - (6.1%) Premeditated about lower prices
  • The term ‘showrooming’ began in 2010 when retail analysts began talking about Best Buy becoming a showroom for Amazon.
  • The exponential growth on smartphone adoption raised fears of showrooming even further, with mobile-assisted shoppers now accounting for 21% of total UK consumers. That’s 1 in 5 people in the UK making purchases on mobile.
  • 40% of UK mobile respondents to this particular survey made below £25k.
  • 74% of all M-shoppers were over 29 years old, which confronts whether millennials are behind all this hype – apparently not! 
And here are some equally exciting facts about webrooming from Accenture’s October 2013 Holiday Shopping Report, which surveyed 500 people in the US on their holiday shopping intentions:
  • 65% of respondents planned to webroom, 63% planned to showroom.
  • The main reason behind webrooming is to avoid shipping fees (47%)
  • The second reason is to see and touch an item before purchase (46%)
  • Another big reason for webrooming is checking stock availability online before purchasing in-store (42%). This is quite important for Merchandisers looking to incorporate an omnichannel strategy into their company 

How Omnichannel is Empowering Customers

Now, for those of you out there who are running a pure-play or bricks and mortar exclusive store, there is still space out there for each strategy to thrive. However, the overwhelming trajectory of shopping behaviour is leaning at least towards multichannel, but more heavily towards omnichannel retailing.

Omnichannel is a strategy that allows you to streamline all departments, both on and offline, to have a consistent and integrated system of communication. That means that I can find a blouse in store, search for it online to find another colour, then order it for click and collect at a store near home, and every aspect, from the fulfilment centre to the product description page, reflects the same information in real time. Omnichannel can be difficult for many retailers to implement since it is an expensive and complex process to put in place, but consumer demands are pushing towards this strategy.

Adding onto this trend, a new app called ShopSavvy is making price checking even easier for consumers by allowing users to scan barcodes, find where the item is sold nearby or online, where it’s in stock and how much it costs – all at the scan of a barcode. These kinds of tools are growing rapidly, especially amongst consumers who already shop on and offline. Omnichannel retailers are the best place for these savvy shoppers to go, and these particular stores will be building the most credibility and gaining the most brand ambassadors in the future.  

How Retailers Can Empower Consumers in Time for Christmas

The first step is to get rid of complicated attribution models, which force you to look at the trees, not the forest. Attribution is still important to determine ROI, but it should be looked at as an increasingly shared activity, where all channels contribute in one way or another to convert a shopper. Webrooming negates most attribution models that retailers now use, so instead of fighting over what consumers do and when, you should offer click and collect services, which allow you leverage physical stores with ecommerce. I used Topshop’s click and collect service the other day, and did it mainly to avoid not being home for the delivery, but also to allow me the opportunity to return items immediately rather than shipping them back. Otherwise I would have opted for the less lazy but more stressful route of going to the Topshop at Westfields on a weekend – eek!

The second step is to implement cross-channel marketing in the form of personalised content. Personalisation is becoming an increasingly important feature for most retailers, so make sure to organise campaigns across all your channels, and offer personalised offers for each segment or user if possible. You should consider a cross-channel merchandising strategy as well, so that products descriptions, coupon deals, and sales can be accessible and available to customers throughout their journey, whether it be online or off.

Another step in the right direction is to offer Wifi in store! This is becoming very important, and rather than being seen as an aid to those pesky showroomers, it should actually be seen as a way to keep customers inside for longer. Many shoppers want to interact with more information on the products they are looking at, so why not offer NFC tags, QR codes, or engaging information in store? Even price comparison is not a conversion killer anymore, as engaging shopping experiences and product immediacy can turn up to 74.5% of M-shoppers according to the stats above.

If you are not doing so already, you should be listening more carefully to your customers and learning from their habits by using all that data you’ve been collecting but don’t know how to act on. Product and marketing analytics are vital to staying in the omnichannel game. In the coming year, every retailer will need to start using their data in constructive and actionable ways, whether that means implementing webmaster tools and GA, or looking to a more robust platform that is able to clean everything up and serve it to you with a pretty bow (like us!).

Takeaway

Webrooming and showrooming are here to stay, as consumers want a more integrated and streamlined shopping experience that blurs the lines between off and online. It is time that retailers took advantage of these trends, rather than trying to combat them. In the end, the consumer will only do what technology allows them, and mobile-wielding shoppers will be using technology in droves this Christmas, so the question remains, what are you doing about it? 

Please let me know in the comments below how your company or brand is handling web and showrooming this holiday!

 

 

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