Webrooming and showrooming: Physical and digital worlds are colliding in retail
This guest post is provided by the Canadian Internet Registration Authority (CIRA), the organization that manages the .CA domain name registry in Canada. CIRA helps small businesses, entrepreneurs and startups get their businesses online.
While Canadians love the convenience of online shopping, the technologies that disrupted retail are now moving back to the shop floor. The line between e-commerce and brick-and-mortar retail experiences is blurring and companies are embracing a world that combines the best of both worlds to the benefit of their customers.
Basic marketing principles teach us to consider the four P's — product, price, promotion and place — and while much of the innovation brought by the internet has transformed the first three, some recent trends are now helping businesses differentiate their "place" in an entirely new way.
So, as you're developing a product strategy for your business, remember to be on the lookout for the trends that are transforming consumer expectations for your business and what they mean for physical retail environments.
E-commerce trends to look out for
Showrooming is an emerging trend where a consumer browses a physical store only to make the final purchase online. In this scenario, the store is effectively used as a display room for products; it fronts the overhead of operating the space and acts as a way for the consumer to try before they buy. Customers will often engage in showrooming for products that they want to test out in person and then buy for a lower price online.
Conversely, webrooming is when a customer researches a product online, and then visits the store to make the final purchase. Someone might do this, for example, if they are browsing a large inventory of sweaters but want to try it on in-store to purchase. Webrooming is also commonly used to compare prices before making major purchases. Customers will often scour websites for reviews, demos and user experiences to ensure they are making the right choice when they enter the store.
Why do customers engage in showrooming and webrooming? Ultimately, technology is empowering customers to minimize risk, maximize convenience, and always get the best price.
While webrooming and showrooming are major trends in retail, they are only a small part of the transformation happening in how we shop. Some stores are moving to an exclusively e-commerce experience (no physical store space keeps costs to a minimum); others are allowing customers to order a product online and pick up in-store. The key is to understand that the internet is changing consumer expectations and there are multiple ways to enhance their experience with e-commerce.
While having an exclusively bricks-and-mortar business is still possible, ideally you should be considering ways that technology can enhance your customer's experience. Even a simple website can provide value to current and potential customers and it requires minimal effort to set up.
In June, the Canadian Internet Registration Authority published Canada's Internet Factbook, which covers trends on Canada's internet, cybersecurity, and more, including one full chapter on e-commerce trends in Canada. Here are some key takeaways:
- 84% of Canadians engage in webrooming.
- 55% of Canadians engage in showrooming.
- 80% of Canadians agree that they almost always compare prices online before making a major purchase.
- 59% of shoppers prefer making retail purchases from a traditional, ‘bricks and mortar' store, down from 66% in 2016.
- The use of a mobile phone to purchase goods online continues to grow, up from just 12% in 2014.
- The most common items purchased online were clothing and apparel, flights/travel packages, and household goods.
How can you accommodate these trends in your business strategy?
In Canada, retailers who have been slow to innovate have experienced a lot of difficulty; many have closed their doors. On the flip side, we've also seen new companies enter the market, delivering products in a way that's never been done before. To be competitive in today's market, a new business should see e-commerce trends as opportunities for innovation rather than barriers to doing business.
The strategy you decide to implement is highly dependent on the type of product(s) you sell — are they tangible? Perishable? Customized? These are all factors that will impact selling online versus in person. Here are a few general tips on how you can embrace the trends:
- Provide a stellar in-store experience. Use the space you have and the face-time you have with your customers to the max. Offer tasters or samples customers can walk away with.
- Blend the online and offline customer experience — if you meet someone in person, direct them to follow your business on social channels. If someone subscribes to your blog, let them know about local promotions or events in your store.
- Ensure your website and e-store are accessible and functional on a mobile device. You may work on editing your site on a desktop, but you need to view it on mobile, because that's how your customers are viewing it.
- Consider how you will offer customer support, both online and in-person.
- Get ahead of your competitors by staying on top of trends. Follow industry news and frequently perform a scan of the competitive landscape.
As you're fleshing out a strategy for your business and product, considering innovative methods of blending the online and offline experience can provide value to your customers and give you a leg up on the competition.
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