Is Showrooming a Threat to Retail Businesses?

Jeff Bezos of Amazon has previously stated that he didn’t see Amazon branching out into physical (brick-and-mortar) stores because he didn’t see how Amazon could clearly offer a competitive advantage over existing retail stores.  However, Amazon has nudged into the old fashioned retail realm by offering “showrooming” experiences for their customers.graphic of a shopping cart for retail business

So, what is “showrooming” ?  And, how is it different from a regular retail experience? Well, it’s not that different.  The big boys in the online world (like Amazon) have opened physical locations that allow customers to view products in person, test them, get questions answered, and then purchase after-the-fact.  So, the real difference is that the “showrooming” concept is primarily a customer service and marketing showroom that helps reduce online buying concerns by creating actual product experiences.

At times customers want to see and touch a product.  In this way “showrooming” allows customers to get educated about a product, or a manufacturer, and ease the consumer’s trust issues.  Showrooms largely do not stock inventory, but tend to redirect consumers to the online platform of their choice.  In this example, that would be Amazon.

So should retailers be concerned with “showrooming”?  Author Bob Phibbs thinks so. He lists 13 reasons why retail should be concerned with Amazon’s showrooming ventures in his blog called the “Retail Doctor’s Blog”.

With online e-tailing such a rising trend, what can a small retail business do? One avenue to help a small business differentiate itself from an online Goliath is to offer something that online stores do not offer.  For example, can you offer a more personal experience that is tailored to the customer?  Can you deliver an enviable ambiance in your store?  Might you be able to connect with the customer on a deeper level than an algorithm and anticipate his or her needs?

If you arCSUN logoe a small business owner in the San Fernando Valley area and are looking for help growing your business and differentiating it from competitors, you may be able to request consulting services from our non-profit organization.

Wells Fargo Center for Small Business & Entrepreneurship matches local businesses with students & professors in order to co-create marketing and business plans.

To request help with your business, request consulting services.

 

 Author:Robin Yerian.  Robin studies Marketing and Business Administration at California State University, Northridge.  She has received an honorable mention for her secondary research regarding the millennial generation in association with the national American Marketing Association case competition for eBay in which she provided consumer insights.  Robin is the student assistant responsible for managing client relationships, communications, and social media for the Wells Fargo Center for Small Business & Entrepreneurship at CSUN.

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