“The increasingly prolific use of smartphones by consumers has changed the shopping experience forever”
This trend in consumer behaviour (price comparing online while shopping in-store, then opting to complete a purchase online), dubbed showrooming, was examined in new research conducted by GroupM Next, the forward-looking digital innovation unit of GroupM, and Catalyst, the leader in search marketing innovation. The research was conducted to gain a deeper understanding of consumer behaviour as it relates to showrooming so that retailers can better understand the price of keeping shoppers in-store. It also provides brands with insight into how they can take advantage of this behaviour and win the sale in-store before the person leaves – or online.
Findings from the study are detailed in a new report, “Showrooming In Canada: Winning The Consumer & The Price Of Keeping Buyers In-Store.”
“The increasingly prolific use of smartphones by consumers has changed the shopping experience forever,” says Jeff Lancaster, CEO of Catalyst Canada. “This trend has had a significant effect on the retail landscape, so we felt it was important to examine the showrooming behaviour of shoppers here in Canada.”
Significant insights into behaviour and influencers among shoppers who price compare in-store include:
- If a price offered online is at least 20% cheaper than available at retail, only 27% of shoppers will stay and complete their purchase in-store.
- Of factors a shopper weighs when making a purchase decision, in order of importance, a discount influences 50% of the decision, shipping time influences 25% of the decision, and familiarity with a retailer influences 25% of the decision.
- Shipping plays a role in keeping a buyer in-store – or for a brand to capture their consumer online. If the only online shipping option is longer than a week, 5% more shoppers will complete their purchase in-store versus buying online when showrooming.
- In terms of showrooming, there is no significant difference in behaviour exhibited between English- or French-speaking consumers.
Compared to showrooming behaviour among consumers in the United States, Canadian shoppers exhibit some different behaviours. For example, in Canada, the majority of shoppers will leave a store and make a purchase online for a discount of $15. The same percentage of Americans, however, will leave a store and buy online for as little as a $5 discount. Interestingly, if the product has an implied sense of urgency, such as headphones, the majority of consumers in both Canada and the U.S. who price compare while in store will complete their purchase at retail, regardless of the online discount. This understanding of buyer behaviour becomes very important for both brick-and-mortar retailers and e-commerce brands with a global presence in order for retailers to maximize growth as more consumers adopt smartphones and showrooming increases.
“Understanding how Canadian consumers approach showrooming can help inform strategies for retailers, manufacturers and online retailers in order to maximize their revenue. Brands will remain relevant and be successful by recognizing how retail behaviour among consumers is evolving,” says Lancaster.
Two-thousand shoppers in Canada were surveyed for this study and presented with hypothetical showrooming scenarios for 12 products in multiple retail categories at varying price points and shipping times. Shoppers were given hypothetical purchase decision scenarios in which they could purchase a product and own it immediately, or take a discounted price, leave a store and have the product shipped with various shipping times available.
Since 1998, Catalyst has been a pioneer in developing strategic digital marketing services for Fortune 1000 brands, including some of the largest companies in the world. Headquartered in Boston with offices in New York, Chicago, Seattle, Toronto and Montreal, our clients span B2B and B2C verticals, and cover multiple industries. In Canada, Catalyst (formerly Outrider Canada) is one of the leading search marketing innovators in the industry. At Catalyst, we pride ourselves on being THE Search Innovator of the industry. Our service offerings include: search engine optimization (SEO), paid search marketing, social SEO, content strategy, digital asset optimization, mobile search, e-retail optimization, local search optimization, global search, competitive reporting, and more. Catalyst is a wholly owned subsidiary of WPP, the world’s largest communications services group. For more information about Catalyst, please visit www.catalystsearchmarketing.com.
About GroupM Next
GroupM Next is the forward-looking innovation unit of GroupM, the world’s largest global media investment management group that is the parent company to WPP media service agencies Maxus, MEC, MediaCom and Mindshare, as well as Catalyst and Xaxis. Together with GroupM agencies, GroupM next focuses on the curation and application of insight-focused solutions across online, social, mobile and addressable channels. Through thought leadership, technology, research and education, GroupM next delivers data-driven actionable insights and a clear path to action to help GroupM agencies and their clients harness the right opportunities made possible in the digital technology and new media industry environments with speed and relevance. Access our work and discover our perspective at www.groupmnext.com.