Traditional Retailers Fight Showrooming With Smartphones

Pablo Valerio, International Business & IT Consultant | 4/11/2012 | 19 comments

Pablo Valerio
Showrooming is the new term that terrifies retailers. We have all done it: We go into a shop to check out the new laptop, digital camera, or tablet, then pull out our smartphone, snap a picture of the bar code, and find the best price online.

After suffering showrooming for a few years, retailers want to turn it into an advantage.

A few years ago, people went to stores armed with a notebook, jotted down model numbers, and then went home to search online. Now, with camera-enabled smartphones and shopping apps, the online check takes only a few seconds. But the retailers are finding ways to fight back. Everyone in the retail market knows they are being showroomed, and now they may have the tools to profit from it.

When we visit an online shop, e.g., Amazon, the shop knows every click, every search, every product we check, and they can follow all of our shopping trends. In this way they can target offers to use every time we visit the site or email us special offers for the products we are looking for. Traditional retailers want that information as well.

Now a startup called Nearbuy Systems says it can provide retailers with that information using the in-store WiFi and existing video surveillance cameras. Combining those technologies, they can track customers using smartphones through the store. Their first product is "Guest WiFi," a simple solution that offers free WiFi to shoppers and is then able to analyze shopping patterns. According to the Website, "The Nearbuy solution helps you utilize your existing store WiFi infrastructure while simplifying and centralizing management tasks such as landing page creation and compliance tracking." Shoppers take advantage of the WiFi platform and the store collects valuable information.

Using video cameras, the store can also track customers' movements through the aisles, and using on-the-fly analytics, know exactly what the shopper is looking for.

Armed with that information, retailers can send discounts and coupons for those products to the connected smartphone, increasing the possibility of getting the sale. Also, employee location technology can direct specialized sales associates to customers, armed with the advantage of knowing what the customer is looking for.

Most people like the instant satisfaction of walking out of a store with the product they want, and they are willing to pay a premium price for it -- but not too much. Knowing what the shoppers are looking for, and the competing online price, can give retailers the opportunity to get close to the price point and win the sale before the customers walk out of the store.

There are privacy concerns, but the convenience of in-store WiFi and special Websites that help shoppers navigate the store makes it appealing to customers to accept the privacy agreements. And many consumers will probably welcome the special offers during their visit. Maybe showrooming won't be so bad for stores after all.

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Syerita Turner   Traditional Retailers Fight Showrooming With Smartphones   4/30/2012 10:43:33 PM
Re: Delicate Privacy Issue IMHO
As I am reading this I have to chuckle to myself. Think about it when your parents went out and "window shopped" they found the best deal somewhere else. This has been going on for years. With the link between shopping and smartphones, it is more evident and recommended by certain retailers. I think that the option is great and retailers should have thought about that when smartphones came out. I use my bar code to find the best deals and usually find it elsewhere then where I scanned it from. I think this will be hard to curtail as it is a very famous and smart way to shop.
impactnow   Traditional Retailers Fight Showrooming With Smartphones   4/22/2012 1:38:44 AM
Showroom your advantage

Pablo I think your point is the really the best solution for retailers use show rooming to your advantage price match or offer other perks in store. If you compete on price only you will loose every time.

Technocrat   Traditional Retailers Fight Showrooming With Smartphones   4/12/2012 5:51:58 PM
Re: Showrooming and Phones: A New Age Cyber War ?

@Pablo  Excellent point - how could I have forgotten.  The largest homing (tracking) device known to Man is already on our person.  I might consider using pay phones again - if there were any to be found.

David Wagner   Traditional Retailers Fight Showrooming With Smartphones   4/12/2012 12:16:06 PM
Re: Delicate Privacy Issue IMHO
@Pablo- I don't think that statistic is evidence that young people are worried about privacy so much as that they understand the problem more than older people.

I don't trust the network that holds my data, but the lack of trust doesn't change my behavior. I simply acknowledge the risk and move on.
Pablo Valerio   Traditional Retailers Fight Showrooming With Smartphones   4/12/2012 11:14:41 AM
Re: Delicate Privacy Issue IMHO
Many young people don't expect or even want the kind of privacy that older generations want. 

@Sara, I don't agree. Actually the awareness about privacy is increasing among young people, especially because of the dangers of online activity.

According to a Pew Research report "adults aged 18-29 are far more worried about preserving the integrity of their reputations online, and are, in fact, less trusting of the networks that host their data. In the study, 28% of young adults said they can "never" trust these networks with their data - twice as many as those aged 50-64 who echoed this sentiment."
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Pablo Valerio   Traditional Retailers Fight Showrooming With Smartphones   4/12/2012 11:04:45 AM
Re: Showrooming and Phones: A New Age Cyber War ?
@Technocrat. Actually, if you don't want to be tracked, the only way is not to use a cell phone at all!

Your movements are tracked continiuosly by your wireless provider, your browsing and calls recorded, your text messages stored, etc. This tracking insdie the stores is nothing compared to that.
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Technocrat   Traditional Retailers Fight Showrooming With Smartphones   4/12/2012 4:47:25 AM
Showrooming and Phones: A New Age Cyber War ?

 

Not really sure how I feel about this new age Cyber War.  It looks like you either have to turn your phone off inside the stores that practice this or just ignore the ad that are bombarding your smart phone.   From a technology perspective this feat is impressive but I just don't know if issue of privacy can be overcome.

 

Sara Peters   Traditional Retailers Fight Showrooming With Smartphones   4/11/2012 4:13:35 PM
Re: Delicate Privacy Issue IMHO
@Pablo  "I do not question the legality of watching people insider the store but, as you also do, question the ethics of it, specially if they do it with subterfuge."  It always comes back down to ethics, doesn't it?  A lot of us here will feel oogy at the idea of being watched, and thus close surveillance being used on ordinary citizens -- for the sole purpose of selling more stuff -- is going to strike us as unethical. However, that perception is changing as people change. Many young people don't expect or even want the kind of privacy that older generations want. So do the same ethics apply if your customers are young people who don't value privacy and don't care if you spy on them?

Seems like it's another one of those decisions that really depends upon your individual organization's situation.

Sara Peters   Traditional Retailers Fight Showrooming With Smartphones   4/11/2012 4:05:02 PM
just don't tell them
I think customers will love this sort of thing as long as nobody ever tells them it's happening. Nobody likes feeling like they're being spied on, and they might feel creeped out if they feel their every habit is being analyzed by some mysterious, remote, robotic overlord.

On the other hand, if sales associates are armed with sort of tool and the info it collects, they might be less of a nuisance themselves. Instead of hovering over customers, peppering them with questions, they might be able to show up and help out when the customer is ready. The customer might feel better served and actually feel like their under LESS surveillance... as long as they aren't told the whole truth.
David Wagner   Traditional Retailers Fight Showrooming With Smartphones   4/11/2012 3:40:28 PM
Re: Delicate Privacy Issue IMHO
I get what you're doing. And you're doing a great job. I just think they need to be doing something else.

In fact, I think what they might want to do is embrace the showroom concept and truly become one. Make a good online presence and just show your merchandise in your store but sell it online. Otherwise, you're just trying to hang on to the less good business plan.
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