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In the Age of 'Showrooming,' How Can Physical Stores Live with Their Online Counterparts?

You check out a product in a physical store, and then see if you can find it cheaper online. What can brick-and-mortar stores do to fight back against this kind of “showrooming”? We talked to digital marketer Bob Gingras to find out. 

Gingras, vice president of brand e-commerce and marketing firm The Acquity Group, noted a new direction in Target’s recent announcement that it will now price-match top online retailers at any time, including Amazon.com, Walmart.com, Toysrus.com or BestBuy.com.

The Age of Omni-Channel

If a customer buys a product at a Target store and finds the same item within seven days at a cheaper price on one of those online retailers, Target will match the price. While Target has had a Low Price Promise since 2009, this is the first time they’ve begun matching selected online retailers.

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Gingras said that brick-and-mortar stores “need to embrace” this new age of the omni-channel, where customers are shopping in physical malls and online stores, and grabbing the best deal they can.

But it’s not always just price, of course. Customers might go into a physical store to see and feel an item, or because of a given selection of products, or because they find the store personnel helpful and knowledgeable. Or, as Gingras pointed out, they might go to Amazon.com because the search engine allows them to look for “cheap socks.”

Pain for Customers

Gingras noted that, while the online match offer from Target and other retailers sounds appealing in principle, in practice it’s a pain for consumers because it’s a clunky, manual process. The customer initiates the price-matching, the customer service person at Target needs to be familiar with the policy, and the customer has to direct Target to the link where the identical article is available — often over the phone.

In its current form, Gingras said, online price matching “is not convenient” and may not be worth the difference in price to the customer. From the retailer’s point-of-view, a price matching offer for online deals “is a great PR stunt,” he said, “but it can work against you” if it takes up too much time for the consumer, who might then have a negative impression of that retailer.

“Price matching has been around for a long time,” he pointed out, but it used to be a fairly simple process — you brought the coupon or ad from the competing retailer into the physical store.

Even so, Gingas said, big retailers “know they have to do this” not only because of showrooming and price-matching offers by their competitors, but because of the growing trend by customers to shop in a physical store with a smartphone — and price-match on the spot. Instead of trying to get a price-match for an online sale through a phone call to customer service, it’s simpler to scan the product's bar code in the store, use an app to find deals for the same product online while you’re standing there, and just show the found deal on your smartphone to a store worker.

Know Thy Inventory

This growing trend, he said, “changes the equation about the hassle factor” for price-matching an item in a physical store with an online retailer, he said.

As part of an effort to embrace the online-physical store competition, Gingras recommends retailers employ a strategy that other consultants, such as those specializing in supply chain management, are similar endorsing — every contact point with a customer should have immediate access to the entire company’s inventory.

Take Barnes & Noble, where one can often go into a physical store, look for a particular title, and find out if that store has it, or another location does, or if it’s available at the company’s online store. “The store has to be integrated with its online component” and its other stores, he said.

The physical store, the online store, the call center — all should have the same access to such experience-defining elements as product information, price-matching policies and inventory. Every source of information in the customer-facing experience needs to be able to tell the customer, he said, such details as “it will be in this store location in three days, and the shipment is on the truck right now.”

 

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