Showrooming: what the shopping centers can offer?

This article from ICSC should encourage the Retail-Driven Property industry to revise its business and real-estate approach to Retail… What could be alternatives business models for Shopping Centers when the value really researched by tenants is not only about Gross Leasing Areas but exposure, customer contact points, media, etc.?…

‘Showrooming’ becoming a trend from ICSC
Showrooming is catching on. And these retailers that stock home-related merchandise have the most cause for concern. The term refers to the consumer trend of researching an item in a physical store and then making the purchase online. Some 20 percent of shoppers who bought home-related items last year made the purchase through showrooming, according to research firm NPD Group. Stand mixers, electric knives, sewing machines and floor cleaners were last year’s most popular showrooming pieces, and this year power tools, hair setters and robotic vacuums show signs of being next, says Perry James, president of NPD Group’s home-and-office-supplies division.

Last year 7 percent of consumers who pre-examined a kitchen item inside a brick-and-mortar store made the actual purchase online, NPD reports. Some 4 percent of shoppers looking at personal-care items later bought the merchandise online, and 2 percent did so with home-improvement products. “On the flip side, two in three consumers that researched a home-related product online ended up purchasing it in the brick-and-mortar store — a practice that has been the norm,” said James. Online sales of small appliances and home-improvement merchandise grew 20 percent in dollar terms last year, says NPD. But small appliances accounted for just 13 percent of online sales in dollar terms last year, while home-improvement sales made up 5 percent. Thus, the majority of these sales took place in brick-and-mortar stores. “We are a long way off from a world of online-only shopping,” said James. “The majority of consumers buy their kitchen appliances, personal-care and home-environment products in a brick-and-mortar store.”

Amazon.com launched a smartphone app last year called Price Check, which enables product scans in physical stores for subsequent online purchase from Amazon at a discount. “The prevalence of smartphones provides consumers with the ability to do price comparisons in real time, while still in the store, increasing the challenge retailers are faced with to offer the best price,” James said. James recommends that brick-and-mortar retailers promote the immediacy of the in-store shopping experience. “The need to touch and feel a product before making the purchase is still very compelling for most customers, and that is what initially gets them in the door,” he said. “Once they have the items in their hands and have decided they want it, the need for immediate gratification can be too strong to go home and wait for an item to be shipped to their home — even if it is the less expensive option.”

Read the ICSC article

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