Retailer Showrooming

The most interesting reaction to the changing retail omni channel market that I have seen recently is the embrace of showrooming by some retailers.  This is interesting because it wasn’t so long ago that all retailers were fighting the practice.  Retailers are now seeing the benefits to their inventory management, consumer satisfaction and forecasting that results from the practice.  This change results from retailer recognition of the consumer demands and more importantly the recognition of consumer control of their shopping and purchasing.  This beginning of acceptance for showrooming shows a distinct change in strategy of retailers to these market demands and their recognition of the acceptance of the impact of the Internet on consumer shopping and purchasing practices.

Showrooming is an extension of the Internet and eCommerce shopping in the brick and mortar shopping space.  This recognizes the impact of the Internet on the retail marketplace and creates the outlets for and physical extension for virtual shopping.  Consumers view shopping and purchasing is a social interaction while the product delivery is the physical outcome of this social activity and sometimes the physical purchase in the brick and mortar outlet and the effort of carrying the purchases can dampen the social experience.  This physical outcome does not need to be tied to the shopping though and the introduction and encouragement of showrooming will result in increased shopping time which also results in increased sales for retailers.

Showrooming provides the means for retailers to improve inventory availability for the purchase because it allows for the consumer demand to be filled from a regional distribution center for more efficient fulfillment.  Another major benefit to the retailer is the ability to test product demand in markets without a large inventory investment.  This provides increased flexibility in managing inventory availability by allowing retailers to easily focus the delivery of the purchase based on consumer demand and not the inventory available in the store at the time.  I believe this will improve the accuracy of forecasting and planning because it allows the retailers to understand the consumer demand and lost sales due to inventory not available.  This increased accuracy and regional delivery will allow for increased flexibility to deliver to the demand and this in turn will result in reductions in overstock and liquidation inventory.  

This is a big step in retail culture that really expands the horizon of possibilities for both retailers and consumers. It allows retailers to define and support a standard business process for purchase and delivery that can be executed from any channel creating a true omni channel experience.  We need to define a new phrase or acronym for this next wave in retail that describes the experience.  The challenge for retailers is to maintain and increase the momentum in this direction and consumers will not be patient with setbacks.  I look forward to these changes, they are exciting times to be a consumer and experiment with the capabilities.

And now for the audience participation portion of the show…

ECommerce will have wide ranging impacts on both the retail and manufacturing sectors.  How can you focus these abilities to improve the consumer's experience?  Improving the consumer’s experience will require a re-evaluation of the sales channels, the manufacturing channels and practices and the supply chain channels and practices from the raw materials to the consumers’ homes.  In order to ensure and maintain success in this new reality you must harness the tools and capabilities in many new areas.  How can you support these continuously changing requirements?