Mobile: A point for bricks, not clicks

Posted in Retail
By Laura Leslie on August 26, 2014

hand holding cell phone

By the mid-2000’s every retailer was accepting that mobile shopping or “m-commerce” was transforming consumerism. Both online and offline stores had reasons to fear the change but also just as many reasons to embrace it.

Seemingly the greater fear was with brick-and-mortar stores as they wondered if they would eventually become obsolete. The added convenience of mobile shopping, coupled with online shopping was daunting to the offline world.

But it is time to consider that some of the more concerning predictions may have been off-base. For example, the “showrooming” scare for offline retailers is proving to be less detrimental than originally thought.

Showrooming is when a customer in a store uses their phone to compare prices, then leaves to purchase online. Having customers armed with this type of convenience certainly warranted a fear for loss of revenue.

However, a recent study done by IBM shows that from 2012 to 2013 the number of online purchases resulted from showrooming decreased from 50% to 30%, indicating that this threat is decreasing as offline stores learn to use m-commerce to their advantage.

With all the information available to us on the internet, it would be silly to make a purchase without doing some simple price comparison and research. But where does that leave the impulse buyer? Spontaneity in shopping is only fun when there is instant gratification, and waiting a few days for a delivery doesn’t really offer that.

Reverse showrooming” or “webrooming” is when a customer researches a product online but then prefers to go into the store to purchase. A recent study done by BI intelligence indicates that as much as 69% of shoppers reverse showroom. And while you may assume that the younger generation prefers the online shopping world, that same study disproves this as well.

Warby Parker, a modern online eye-glasses retailer, is an example of an online store that is making adjustments to cater to consumer trends. Knowing that many prefer to try things on or test products before use, they have opened several brick-and-mortar stores to accommodate their customers better. Other online stores are following a similar model to help lessen the blow of reverse showrooming. There is speculation that eventually even stores like Amazon will have to bend their traditional business model to give the people what they want.

Unfortunately offline retail has experienced negative growth since 2008 (other than a slight 2% increase in 2010). While this is certainly alarming, it shows us that there are greater forces at play contributing to the offline decline. While both m-commerce and e-commerce are hurting offline sales, we think the bigger problem is a lack of intelligence across these multiple channels. Remember, most large retailers have online, offline, and mobile platforms that they aggregate data from. How you optimize for customer behaviour trends like webrooming depends largely on how you use your data.