The true impact of showrooming

Billions of pounds of sales ‘up for grabs’ over Christmas as a result of showrooming.

During the run up to Christmas we surveyed shoppers to uncover the true impact of the phenomenon known as showrooming, where consumers visit a physical store when shopping for a product, before checking to see if they can get a better price online.

Our research showed that around a quarter of all UK shoppers used their mobile in a store to compare prices elsewhere in the run-up to Christmas.

Unlike other recent studies on showrooming, we also gathered data on how consumers acted, once they’d compared prices by mobile, with 40% saying they bought elsewhere as a direct result of showrooming.

Research highlights included:

• 24% of all UK shoppers ‘showroomed’ in the lead-up to Xmas 2012.
• 40% of showroomers (or 1 in 10 of all shoppers) say they bought items from a competitor – either in-store or online – after comparing prices via their mobile when visiting a store.
• 39% of 18-39 year olds surveyed said that they actively engaged in showrooming over the Xmas period (compared to just 18% of shoppers over the age of 40).
• A 10% sales ‘leakage’ from showrooming activities would have meant that around £500m** of sales were switched between retailers in the final weekend before Xmas alone.
• Over 20% of people say they went into a store just to check out something they planned to buy online.

Our research uncovers the true impact of showrooming on the UK High Street over the Christmas period. It shows that 1 in 10 shoppers switched purchases from one retailer to another as a direct result of showrooming. Or put another way, half a billion pounds of business walked out of the door to a competitor.

The age profile data is especially interesting, with younger, more smart-phone savvy shoppers being far more active showroomers than the older generation. This suggests that showrooming is here to stay, and set to grow. The High Street needs to find ways of accommodating and embracing showrooming as part of the modern-day shopping process.

Actions can range from price-matching policies, offering a checkout and delivery experience that is slicker than going elsewhere, and better integration of their online and offline customer experiences.

**Based on British Retail Consortium, data of £5bn spent High Street spending over weekend before Xmas (“Estimated that £5bn will have been spent in Britain’s shops over the weekend, as millions of people stocked up on food, drink and presents.”)
 

Further reading

• Blog: Was HMV the first victim of showrooming?
• Research: Going Mobile, mobile and brand perception infographic
• Blog: Mobile and tablet specific guidelines – design considerations

04/01/13 Jim Leafe said:

Great insight - When doing some shopping in store I know I do this. Can you share what the sample size of this survey was and where it was conducted?

04/01/13 Jim Leafe said:

The key point of interest is why once they were in store did they not purchase. I think this is where geo targeted mobile ads, auto check in on social (four square, Facebook and Google+) really come in to their own. Then linking up this social data to things like our store card data would be key in retaining and converting these shoppers once they are in the stores. Show rooming could really shape what shops look like in the near future - less stock, faster checkout, better delivery options, more space, WiFi hubs etc. The role of the shop will have to adapt.

07/01/13 Peter Ballard said:

Thanks for your comments Jim. The survey sample was a 1000 UK shoppers, conducted through Usurv. The survey was populated over a number of different sites, and there was no paid for incentive to participate. I agree with your comments about the key point of interest, it would be fascinating to dig a bit further into the motivations people had for going elsewhere: was it purely price? Or did other factors come into play e.g. convenient delivery times, better after sales service. You also make a great point about the role of the shop having to adapt. I suspect the degree to which retailers need to adapt their in store model is in direct proportion to how considered the purchases in that store are: High value, low volume purchases will prompt more multi-channel shopping behaviour than low consideration, regular purchases. Finally, I think you touch on one of the key pain points in the current in store retail experience, the checkout process. The work that Apple and a few other forward-thinking retailers are doing in mobile check-outs is a great example of the convergence of digital and in store retailing.

17/01/13 Paul Blunden said:

Interesting survey and valuation of impact. I covered this a little in my blog yesterday when discussing the demise of Jessops and HMV. To me the interesting questions, which are touched on in the last comment, surround what retailers can do about it. Consumer behaviour is loeading [driving?] change in this area and retailers on the whole are slow to reacte and seemingly have no mechanism for predicting the future. If they don't pre-empt this change where does it leave them? I wonder if brands will start paying for the showroom space provided by retailers. Maybe brands will one-day own the stores for demonstration purposes but not fulfil. Maybe they will dissintermediate the retailer. Interesting times ahead.

22/01/13 Mike said:

This kind of showrooming impact surveys is common now. Offline retailers are hunger for showrooming cure. Anyone?