June 7, 2012, 4:50 PM

IRCE 2012 Report: ‘Showrooming’ is about information, not price

At IRCE, Forrester Research analyst discussed retail’s radical shifts.

Bill Siwicki

Managing Editor, Mobile Commerce

Lead Photo

Forrester Research's Brian Walker at IRCE 2012

Showrooming” describes consumers using smartphones in stores to compare prices offered by competing retailers, and sometimes completing a purchase with a competitor while standing in the first retailer’s aisles.

Brian Walker, vice president and principal analyst of e-business and channel strategy at Forrester Research Inc., challenged the common perception that consumers are mainly looking for a better price when they engage about this behavior. “It’s not about price,” he says. Rather, most smartphone-toting consumers in stores are looking for more information, Walker contended at the 2012 Internet Retailer Conference & Exhibition in a session titled “Leveraging a commerce platform in the era of the anywhere, anytime, any device consumer.”

“Showrooming is about product information and social validation when a shopper is buying a product,” Walker said. “I may want to make sure I’m getting a decent deal, but very few customers are constantly checking prices. You may be spending loads of time and money training sales associates, but the customer knows they have a better tool in their smartphone. The retail store experience is changing faster than it has changed in a very long time.”

Mobile commerce is playing a large part in driving this change, Walker said, and that requires retailers to entirely rethink the way they do business.

“People have this paradigm in mind when they think about the business: There are stores, the contact center and the web site,” he said. “This isn’t how the business looks at all anymore. It is many digitally enabled touch-points. Some are self-service, some are assisted—they all are digitally enabled, including the web, contact center, cash register, iPad and smartphone.”

Merchants must focus on this new form of retailing in every aspect of their business, from conducting marketing cross-promotions to building effective order management systems to merging the web and the store, he added.

In this digitally enmeshed retailing realm where m-commerce links stores, catalogs, web sites, smartphones and tablets, customers do not see sales channels, they see a brand, Walker said.

“The impact of an experience is more important than ever before,” he said. “Consumers used to be more forgiving of a bad site experience, not attaching that to an entire brand. That’s not true anymore. If a customer has a bad experience on one of your digitally enabled touch-points, that affects your entire business. The stakes have gone up. A bad mobile site might not just affect your mobile conversion rate. Consumers might not be able to find a product on the mobile site and then not visit your store.”

As a result, retailers need to embrace what Walker called “the era of agile commerce.”

“Times have changed, the stakes have gone up, and it’s time to get serious about serving the customer in these different ways, otherwise you will suffer as a business,” he said. “They will vote with their clicks and their feet and shop with companies that drive convenience and the information they are looking for across these different touch-points.”

Comments | 1 Response

  • Agreed! A majority of IR's believe that they'll die on the vine unless their price is one penny lower than the next competitor. IR's need to wrap their mentality around the fact that information, service and reputation account for the majority of consumer decision making. Price is important, but not for the reasons that many marketers think. Consequently a lot is left "on the table" unnecessarily. -Dave Leonard CEO, Advanced Pricing Logic, Inc

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