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Price transparency is pervasive in today’s retail environments. 80% of smartphone users use mobile phones for shopping research, and 80% of those shoppers do their mobile research in store.22 39% of walk-outs, when shoppers leave without making a purchase, were also influenced by smartphone usage.23

The usage of mobile phones in stores has led to the phenomenon of “showrooming,” which turns brick and mortar stores into showrooms for products which are then purchased online or via mobile. No retailer is entirely immune to its effects. Every company from PetSmart to Bed Bath & Beyond to Costco is at risk.

The usage of mobile phones in stores has led to the phenomenon of “showrooming,” which turns brick and mortar stores into showrooms for products which are then purchased online or via mobile.

While many businesses fear that showrooming is a major threat to their business, retailers should approach showrooming as an opportunity. We’ve seen five strategies work very well in a retail setting.

Five strategies

Build your own digital relationship with the in-store customer

Retailers know that showrooming starts in a store, so many of them are engaging with customers while they’re shopping. Sprint has won a J.D. Power award for its in-store experience, thanks largely to its ability to connect with customers. “ReadyNow,” the company’s branded retail strategy emphasizes spending time with customers in-store to answer questions and setup their devices to ensure they get the most out of it. With the advent of mobile, Sprint is building on its ReadyNow strategy to further strengthen its digital relationship with customers.

Sprint empowers mobile consumers to access product reviews and pricing while in-store

Our showrooming defense is actually more offensive than defensive. We’ve always been very focused on the retail experience. Now we are focused on layering on digital experiences that will make it even better.

Scott Zalaznik

VP of Digital at Sprint

Realizing that in-store customers often had more product information in the form of online ratings and reviews than store staff did, Sprint launched several in-store enhancements. The company began including QR codes on shelf placards that surfaced useful product info such as CNET ratings and reviews that customers could easily access while browsing or speaking with an in-store representative. These mobile-optimized web pages receive thousands of in-store impressions per month. More recently, the company has launched a tablet and mobile-optimized plan configuration tool that in-store staff can use to help customers select the right mobile phone and associated plan for them.

In addition to better answering customer questions about using mobile, Sprint has made it a priority to offer customers the option of buying online via mobile or desktop and then picking up in-store. The initiative allows customers to buy where and when they want at the same price, and still benefit from the best-in-class experience Sprint offers in-store. To make the in-store pickup process even better, the company plans to roll out digital kiosks and tablet solutions that will allow a customer to more easily pick up a phone they’ve already ordered when they arrive at the store.

“Our showrooming defense is actually more offensive than defensive,” said Scott Zalaznik, VP of Digital at Sprint. “We’ve always been very focused on the retail experience. Now we are focused on layering on digital experiences that will make it even better.”

Build policy and train your associates on areas like dealing with price requests from showrooming

It is important to establish a company policy around how to handle price matching requests. Once established, it’s equally important that retail staff understand the policy and have the tools to implement it.

It is important to establish a company policy around how to handle price matching requests.

Best Buy strongly believes that once customers are in your store, they are yours to lose. CEO Hubert Joly says he loves being the “Internet’s Showroom,” and that having customers in his stores is a huge opportunity. Over the 2012 holiday season, Best Buy ran a pilot price matching program within 50 stores, arming specially trained sales reps with tablets that could be used to search comparison sites for the lowest price available.24 Sales reps were then empowered to match the lowest option to complete the sale. If an item was not currently available in-store, then a rep could help a customer complete the sale online. In February 2013, the company rolled out a permanent price matching policy based on the results of the pilot, offering to match local retailers’ prices as well as those of 19 online retailers including Amazon.com and Walmart.com.25

Target offers a price match guarantee as part of its “shop with confidence” policy, which features a more generous return policy and additional 5% savings for Target REDcard holders. Customers that find a lower price on select websites including Amazon.com, Walmart.com, BestBuy.com, ToysRUs.com, and BabiesRUs.com, can request a price match within one week of purchase.

Refine your value proposition for the showrooming consumer

Some stores are rolling out features that match digital switch-pitches such as offering same day delivery, in-store pickup, showing in-stock items within the store, and free online shipping when an item is out-of-stock. To prevent losing out on orders for out-of-stock items, Kmart launched the "Ship My Pants" campaign, which reminds customers that if they can't find what they're looking for in-store, a sales associate can find it on Kmart.com and ship it to them for free.

Press the Play Button to watch the Kmart "Ship My Pants" TV spot

Nordstrom has taken the unprecedented step of merging its online and in-store inventory, displaying inventory from warehouses and physical stores together online. Customers can either pick-up arrest items in-store or request delivery (for free). Merging inventory has turned physical stores into an even stronger asset, ensuring the company is nearly always able to meet requests for particular items.26

Walmart’s free “Pickup Today” service allows customers to order online and pickup in-store later that day. Customers receive an email or text message alert when their items are ready for pickup, turning Walmart locations into an extension of the company’s online presence.

Reward the in-store shopper and improve in-store experience

By making the in-store experience more engaging, financially rewarding, or both, retailers can secure an edge against online-only counterparts.

Target offered free in-store WiFi to its customers over the 2012 holiday season. The store’s Internet service gives customers better access to its mobile app, and helps shoppers redeem mobile coupons and scan QR codes throughout the store.

CVS ExtraCare cards allow shoppers to earn credit in the form of cash and coupons for in-store purchases. In addition to the physical version of the card, CVS shoppers can now create a virtual card that they can save to the CVS mobile app.

Office Depot is rolling out mobile point of sale (POS) to all of its stores this summer, allowing customers to check out anywhere within the store using a credit or debit card, and avoid waiting in line. Mobile POS devices will also allow staff to look up product information online and place online orders in addition to completing in-store transactions.27

Macy's Black Friday app

In preparation for Black Friday 2012, Macy's and eBay created a cutting-edge mobile app experience for holiday shoppers. In addition to the ability to create shopping lists and receive special deal announcements, users of the location-aware app could receive Black Friday deal notifications as they entered a Macy's store as well as every five minutes afterward as long as they remained in the store.

Consider unique items to prevent price comparison

Retailers most susceptible to the effects of showrooming are those whose stock is identical to items available online. To differentiate in-store offerings, retailers are turning to private label brands, exclusive partnerships, and limited-release items.

Macy’s combats showrooming by offering unique items. Fifty percent of the store’s inventory is comprised of Macy’s private labels, exclusive brands, and other proprietary products that are only available in Macy’s locations.28

Target has publicized its goal of expanding the number of exclusive product lines it develops with partners. One area the company has seen particular success is with music exclusives. Recently, Target partnered with Justin Timberlake as the exclusive source for the deluxe edition of his first release in six years, “The 20/20 Experience". Upon release, Target was the second largest source of album sales after iTunes and the album was one of Target’s top-three best selling albums of the last decade.29

Target's partnership with Justin Timberlake

To give you an even deeper look at these strategies, we spoke with two retail veterans who shared with us how they’ve put them to work.





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