It’s probably been years since you first noticed customers wandering through your aisles with their eyes fixed on their smartphone, checking out alternate offers for merch that’s sitting right there on your shelves.
“Showrooming,” as this growing practice is known, has become an unavoidable pitfall of brick-and-mortar retail in pretty much every context, from national chains down to the mom and pops. The upcoming holiday season will likely see the practice at its peak – a report from the National Retail Federation last month found that the average U.S. consumer plans to do 40 percent of his or her holiday shopping online this year.
A major new study from the Columbia Business School’s Center on Global Brand Leadership goes a long way toward breaking down this trend into a number of interesting findings at all levels of retail.
The study, called “Showrooming and the Rise of the Mobile-Assisted Shopper,” took a big look at 3,000 shoppers in three markets (United States, Canada, and the U.K.). The results led researchers to categorize mobile shoppers into five groups.
For MI dealers, there’s bad news and there’s good news.
First off, everyone is doing it. Far from a generational problem, the study found that 74 percent of mobile shoppers are over 29 years old. Simply put, there are no demographic blind spots in this trend. Store managers won’t have to look hard – according to the study, one in five consumers is checking their mobile device for deals. Retailers must adapt to the growth of mobile shopping if they want to survive.
The good news, though, comes from several directions. A key point is that small retailers have the most to offer mobile shoppers in terms of customer engagement. So while chains like Wal-Mart and Target spend millions developing ways to funnel in-store m-shoppers to their own online equivalents, small retail stores can use tools at hand to best build lasting relationships with their customers.
Matthew Quint, the center’s director and the author of the study (along with David Rogers and Rick Ferguson), explains: “For small business owners, the most important strategy is to be completely devoted to customer experience,” he told MMR. “The advantage in your category is that a strong emotional connection usually exists over the purchase of a musical instrument.”
“To combat showrooming, you’ve got to up your game,” says Jameson Stewart, a sales manager at Boston guitar shop Mr. Music. Stewart sees a lot of customers relying more and more on web services for research – not just price, but product details and user reviews as well. “That’s what I’m here for, theoretically,” he says. “I have to make sure to go through the whole schpiel with them – ask them what they’re curious about, if they’d like to take it out to try, and be a salesman for them.”
Scott Emmerman, the director of sales and marketing at Hohner, Inc., says the issue is serious. “Showrooming is kind of an epidemic,” he says. “The big box stores really started the term and began dealing with it early, and music stores have some protections. For instance, there really are no two guitars that are exactly the same – there are lots of nuances you have to see in person.” He notes that several sectors of MI, though, are more in line with typical commodities – you’re in competition with anyone else who’s supplying them.
Emmerman recommends building communities akin to the one he found at a local Chicago music shop when he was growing up. He points to practices of maintaining expertise in particular product segments and genres, along with adding value to sales with lessons and services deals.
And maybe there’s an even more proactive role for the manufacturers in this as well. Instruction-enhanced guitar company Fretlight Guitars’ new “Fretlight Showroom” program provides retailers with an interactive POP display and demo guitar (the retailers are not required to stock Fretlight inventory). In return, the company will send incentive payments to the retailer for all mobile purchases of the guitar made within a 25-mile radius of the store.
Bill Abel, Fretlight’s director of sales, says Fretlight developed the idea to help battle showrooming, as well as retailers’ inventory risks. “Traveling from dealer to dealer, you see what they go through with manufacturers,” he said. “With this, we said to dealers, ‘We’ll worry about selling the products, we just want you to display it. Hopefully, we’ll drive some business to your store.’”
Abel says he’s hoping to take advantage of the unique role that retail shops play in providing longevity to MI consumers, giving them a lifetime of reasons not to just leave their guitars under their bed and forget about them.
“Inevitably, after one of our customers buys a guitar from us online, they call us up to ask what to do about broken strings or where to find a guitar strap,” says Abel. “I want them to go to the independent dealer so he can make that connection. He’ll be able to take lessons there, he’ll be able to buy accessories. The independent dealers take great interest in these consumers.”
Emmerman notes that part of the challenge is to simply figure out who the worthwhile customers are. “Some customers are just always going to be about the cheapest possible price – let them buy online,” he says. “Realistically, those folks can never be relied on for growing or even sustaining a profitable business.”
