New Report Shows Showrooming is “Overblown”

In the wake of a new report titled, “Showrooming and the Rise of the Mobile-Assisted Shopper,” the concept of showrooming has been diminished through research conducted by the Columbia Business School and global loyalty experts Aimia. The report identifies five distinct segments of mobile-assisted shoppers and uncovers clear opportunities for retailers to engage and retain these tech-savvy customers.

“Showrooming isn’t as big of a fear factor,” David Rogers, a co-author of the study and professor at Columbia Business School, told Loyalty 360. “The fear factor of smartphones in the store is overblown. The more dangerous thing is customers never entering your store.”

Matthew Quint, a co-author of the study and director of Columbia Business School’s Center on Global Brand Leadership, told Loyalty 360 that showrooming is not the “dominant experience or dominant behavior.” Quint said shoppers are using mobile devices mostly to research information.

“Price checking can be involved, but they are also looking for product information and product reviews,” Quint said. “Smartphones are most likely helping consumers to buy. These are tools enabling their shopping experience in-store as they commit to buy.”

The researchers looked at the attitudes, shopping patterns, and motivations of 3000 leading-edge consumers in the U.S., U.K., and Canada to better understand how mobile devices are impacting their in-store shopping habits; identifying those shoppers most likely to showroom; and outlining actions retailers can take - such as loyalty programs, price matching, free shipping, and mobile payments - to encourage consumers to open their wallets in-store.

The results paint a clear picture of today’s mobile assisted shoppers – or M-shopper – and debunk commonly held assumptions many brick-and-mortar retailers make about retail showroomers.

The report identified five distinct types of mobile-assisted shoppers:

The Exploiters: It would be easy for retailers to write off the Exploiters as a lost cause, the report says. But the best opportunity for retailers to win their business may simply be to improve the store’s website. When Exploiters see a product on the shelf and pull out their mobile device, they are nearly as likely to search for it on the store’s own website as on a competitor’s site (69% vs. 77%).

The Savvys: Although they currently represent only 13% of mobile-assisted shoppers, Savvys are the ripest target for retailers to try out new offers and experiences in the mobile space. They are simultaneously more digitally-savvy, more willing to sign up for loyalty programs, and more likely to be motivated by a range of retailer offers and rewards.

The Price-Sensitives: Price-Sensitives use their devices in stores periodically, but not as consistently as the other segments. Often, the right in-store experience will be enough to earn the Price-Sensitives’ business. Their mobile devices may be with them, but still remain in their pockets and purses.

The Traditionalists: These shoppers are committed to purchasing in-store, making them the least threatening segment of mobile-assisted shoppers for retailers. They are open to interacting with retail stores on their mobile devices, whether by website, store app, or even scanning a QR code. But, they are currently using their devices mostly to consult on purchases with friends and family.

The Experience-Seekers: As the largest of all the segments, Experience-Seekers point to the opportunity for retailers to engage customers on their mobile devices in non-financial ways, with opportunities to comment, provide ratings, etc. And they demonstrate why retailers still need to invest in providing a unique and compelling in-store experience.

What’s more, the report indicates that many shoppers with smartphones care about more than just the lowest price on every item. While roughly 25% of M-Shoppers may require a discount to motivate in-store purchases, a clear majority can be enticed to purchase in-store through information assistance, engagement strategies, and strong loyalty rewards programs.

Rogers points to the study statistic that shows only 6% are fully devoted to showrooming.

“Retailers have to develop strategies that support every convenience and option,” Rogers said.

Quint said 60% of respondents said they find online reviews helpful in assisting them, with an in-store purchase.

“The study found that 70%-80% are more likely to buy that day in-store rather than being on the fence and walking out of a store when they find more information,” he said.

Here some more key takeaways from the report:

Showrooming isn’t just for the Millennial Generation: Contrary to popular belief, 74% of M-shoppers are older than 29 years old.

Mobile devices can actually improve the chances of an in-store purchase: More than 50% of M-Shoppers are more likely to purchase a product in-store when their mobile device helps them find online reviews, information, or trusted advice.

Price isn’t always the most important factor: Although “price checking” is the number one action of M-Shoppers, convenience, urgency, and immediacy are the top three reasons why M-Shoppers will buy in-store even if they find the same product cheaper online.

Loyalty programs are worth more than just their points: 48% of M-Shoppers say that being a member of a store’s loyalty program makes them more likely to purchase products in-store, despite equal or cheaper prices online.

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