Showrooming shoppers key for Walmart

26 November 2012

NEW YORK: Walmart, the biggest retailer in the US, is seeking to "embrace" the habit of showrooming, where consumers compare prices on mobile phones in stores before buying online.

The company has developed a "geo-fenced" app for smartphones which recognises when customers are accessing it in stores, and adapts the material displayed to them as a result.

Shoppers can also view a digital version of the latest circulars and find out what new products are available in a given branch as well as scan barcodes to check prices and add up the cost of their basket.

"You've got to go where the customer wants you to go. We live in the age of the customer," Joel Anderson, president of Walmart.com, told Wired. "We're embracing showrooming."

In a further indication of the firm's online and offline integration, app users can "flip" between the store-specific and digital modes, and thus research or buy items from its website while in a physical outlet.

This tool may be useful, say, if a product is out of stock, but also serves the purpose of keeping buyers in Walmart's wider ecosystem.

Gibu Thomas, the company's senior vice president, mobile and digital, said this "blended channel" model is yielding results, with 12% of web purchases made via this app being completed in its in-store mode.

Thomas argued this approach does not promote one channel at the expense of another, and reflects consumer attitudes. "That's not how customers think. They think, 'I want to shop at Walmart,'" he said.

A recent poll of 59 retailers by Edgell Knowledge Network, the insights group, and eBay, the online retailer, found 80% expected Thanksgiving and Christmas sales to fall by 5% due to this habit.

"Showrooming is a phenomenon that's here to stay," said Gaurav Pant, of Edgell Knowledge Network. "But the good news is that retailers can put strategies in place to help counter the effects of showrooming by engaging showroomers actively [and] integrating their online and offline channels."

Similarly, Scot Wingo, the chief executive of ChannelAdvisor, the ecommerce software company, suggested retailers' best chance to fight back was by developing tools to compete with their online rivals.

"Consumers are going to be using these things. Just be there," Wingo said. "That consumer is going to buy that widget from somewhere. If you're not participating, you're not going to make that sale."

Data sourced from Wired; additional content by Warc staff