RETAIL: Physical stores risk losing sales to the rise of “showrooming.”
By Desmond Ho, Staff Writer
It is no secret that brick-and-mortar stores are struggling to keep up in the wake of online shopping. Sites such as Amazon are now many peoples’ go-to places for shopping. Many shoppers turn to Amazon because of the convenience and its comparatively low prices. In this day and age, it’s practically the better option.
Recently though, there has been an increase in the practice called “showrooming.” This is when people look at and examine a product in a physical store but then later purchase it online at a cheaper cost. It hasn’t made a huge impact on physical stores yet, but they don’t want Amazon to claim all of their potential sales. Many people assume that Amazon will always have cheaper prices, but this is not always the case. RetailWire reports that, out of 36 items consisting of groceries and health and beauty products, Amazon prices were 20.5 percent higher than those of the same products at Wal-Mart. According to a survey in The Sacramento Bee, four out of ten smartphones and tablets owners have showroomed. When asked, people reported that they have showroomed in the past, most often on home electronics (50 percent) and tech devices (44 percent). Retailers may find more cases of showrooming in the upcoming holiday season.
Because retailers want to make as much profit as possible, they are beginning to fight back. Wal-Mart is discontinuing the sale of Amazon’s own Kindle tablets in their stores, but is still carrying other brands’ tablets. Target, Best Buy and Wal-Mart are matching Amazon’s prices on their online stores. For example, Best Buy, one of the most-effected retailers of Amazon’s competition, is offering free home delivery on items out of stock in the physical stores.
With analysts predicting that less people will be in stores come holiday season, these brick-and-mortar stores have to try something new in order to compete with online stores such as Amazon. We’ll see in the coming months whether their efforts will make a difference or not.
Courtesy of ritalogisticsblog.files.wordpress.com