The Pink Elephant Lady
Do you 'showroom'? Well, stop it!
Picture the following: You go into brick and mortar store and an item really catches your eye. You say to yourself, "I bet I can find that cheaper on Amazon." You then look up the item on Amazon, inevitably find it cheaper, and then buy it online. Or, you take a picture of the item or its label, and look it up on Amazon later.
Sound familiar? This is called "showrooming" - and it's toxic for small business. I used to do it. I never really thought about how this practice impacts a community - but I'm sure thinking about it now!
Back in 2011, Amazon actually ran a promotion to pay customers $5 to walk out of stores empty-handed. By using Amazon's mobile app to compare a brick-and-mortar's prices with theirs, customers could earn $5 off their Amazon purchase (that the customer will inevitably make because small indies just can't match the mega-discounts that Amazon, as a giant player, is able to extract from wholesalers and book publishers) . Customer saves money while Amazon collects intelligence on prices in stores! Win-win? Not so much. http://allthingsd.com/20111206/amazon-will-pay-shoppers-5-to-walk-out-of-stores-empty-handed/
This practice is especially damaging for bookstores. Ben Steelman of StarNews says in his blog, " I’d really hate to see small, independent bookstores go the way of the record shop or the Post Office. The biggies tend to promote the same narrow line of best sellers. It’s on the shelves or odd little curiosity shops that I find the offbeat stuff that I really want to read (and didn’t realize I did)". Further, he discusses a New York Times story on how some New York bookstores were starting to charge admission to author readings and other in-store events — since too many pedestrians were walking in, taking advantage of the free culture, then walking out empty-handed. Only (in many cases) to beat a path to Amazon’s domain. http://books.blogs.starnewsonline.com/14971/amazon-window-shop-in-stores-then-buy-from-us/
How does showrooming affect a community? Here's an example: According to the article "Independent Retailers Are Struggling to Survive in D.C." (http://www.washingtoncitypaper.com/news/article/20861085/independent-retailers-are-struggling-to-survive-in-dc), when products are purchased locally, 68 cents of every dollar stays within the D.C. economy, compared to the 43 cents that stays in the community when items are purchased at box stores or online. Shopping locally creates local jobs and an economic boost.
Take a look at the infographic below. So, just $5 tips the scale in Amazon's favor. Are we willing to sacrifice the character and flavor of our communities....to save $5? Do we really want our downtowns to be composed of mostly trendy restaurants, a few chain stores, and apartments most of us can't afford? We pay lip service to wanting quality, a personalized shopping experience, wanting to see more of the MADE IN THE USA label, but we're not practicing what we preach - we're supporting price wars that drive small retailers to the bottom. We say we want value, but it seems what we really want is the cheapest price.
I hear people say, "But I have to shop at Wal-Mart. I don't make much money." Or, "I'm a teacher. I have to shop at the Dollar Store because I need things for my students that are so much more expensive elsewhere". Have we ever stopped to think that it's the shopping at Wal-Mart and the Dollar Store, and the 'showrooming', that creates an economy where we can't afford to shop elsewhere? Which came first - the chicken or the egg?
I chuckle a bit when I hear people who are otherwise protectionist and pro-union, who lament the loss of the mom-and-pop stores of yesteryear, and are all about 'being tired of all that Made in China junk' revel in their latest 5-Below or Dollar Tree find. Bit of a disconnect here, no? Just the other day I was purchasing gorgeous hanging plants from an independent retailer, and was met with a smug, "You totally overspent on those. Wal-Mart has 'em for $7.99 !" Sure they do. And it LOOKS like a $7.99 plant from Wal-Mart, too.
Small business CAN fight back! Here's an article from Business Insider about, ironically, using the same technology and big data that drives showrooming to drive people into brick-and-mortar stores. http://www.businessinsider.com/how-to-fight-showrooming-2013-4
According to the article, mobile payment technologies and apps that offer users rewards, like $5 off a meal, for paying with their phones in-store can help add value to the in-store experience. "Technology is, perhaps somewhat counterintuitively, the best weapon that merchants have in the battle against showrooming."
Happy shopping - and I'll see you at the cash register, right?