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I have a confession to make, I'm a showroomer.

The Denver Post in the United States ran an interesting article recently entitled "Stores make peace with "showrooming" as we head into the holidays". The article calls showrooming the "act of relying on brick-and-mortar stores to survey and compare products, and then ultimately buying those products online through a phone, tablet or computer." Or, quite possibly, through another dealership.

Showrooming is more prevalent than you think
Let me give you a recent example. Black Friday in the US is insane, but it's the perfect Christmas shopping day if you're looking for great deals. My wife wanted a pair of Nike running capris. The pair she was interested in came in two types of fabric and I had no idea which was better. In this case, I had already made up my mind that I would buy them online from one particular store during an online Black Friday deal. The store's competitor has a location right down the road from me so I went to go check things out. After visiting the store and actually feeling and touching the fabric (no, I didn't try them on), I was able to zip back home and make the purchase from my computer.

Yes, I'm guilty of showrooming, but I'll bet you've done it too.

If you think showrooming has nothing to do with the automotive industry, think again. Virtual dealerships already exist. Take a look at eBay Motors, where my father recently purchased a truck more than a thousand miles from his home. What's more is that showrooming can also mean that a prospect walks in to any given dealer just to get a feel for the vehicle he or she is interested in, only to return home and shop online and compare prices.

A few ways to combat showrooming in your dealership
To combat this trend, some big box retailers are offering price-match guarantees for any store in their local area. Others are going as far as price-match guarantees for any store, anywhere whether it's online or not. Another idea might be to offer products no one else has or provide additional customer support or service that no one else does. Others have suggested eating the cost of the price-match and do your best to upsell additional features or services.

In the automotive market where product differentiation is difficult, I suggest being different by providing amazing customer service before, during, and after the sale. Several dealerships have done this very well by using video presentation tools. Others give away 'Thank you' packs, have light meal services on-site or hold special events for their customers.

Showrooming will only grow in popularity as smartphone usage continues to rise. Each dealership will need to anticipate these trends and be prepared to use some of the strategies above to make sure they're not losing the sale.
photo credit: thienzieyung

Views: 447

Tags: Car Buying, Marketing, Showroom, Showrooming, online

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Comment by David Wassmann on January 8, 2014 at 2:26pm

You bring up great points. We noticed this going on over a decade ago in the new car leads biz…especially luxury customers were willing to drive over 100 miles to save a few hundred dollars. They'd first test drive cars and submit leads locally and then buy from the dealer that had the best "deal." 

Comment by Ed Brooks on January 8, 2014 at 11:13am

"Lots of customers are willing to travel a long way if there is a bargain on offer, and any individual dealership is being virtually compared against many more, now that the internet does the walking." This comment is absolutely right. The days of customers driving from lot to lot comparing vehicles are over. In my opinion, if they are on your lot, this is your sale to lose. The data backs this up as well. They shop online, they buy on the lot. 

And "Showrooming" is just an excuse - much more likely the salesman or the manager missed a signal and lost the opportunity.

Comment by Joshua Pullan on January 7, 2014 at 1:38am

Hi Ed, thanks for joining in and great find with the article, really informative. You're right that brick and mortar dealerships sell the cars, but that doesn't mean showrooming isn't a problem. Indeed Brad Tuttle's piece says that the best way to beat showrooming is to embrace the fact it's happening and fight back, with no room for complacency! Mobile internet allows anyone visiting a dealership to check against other physical sites. If the price is significantly cheaper elsewhere than say bye-bye to that sale! (Again as Tuttle says the price doesn't have to be hugely different, anything near 10%) What's more is that you can search farther than ever before. Lots of customers are willing to travel a long way if there is a bargain on offer, and any individual dealership is being virtually compared against many more, now that the internet does the walking.

Comment by Ed Brooks on January 6, 2014 at 2:42pm

In retail automotive, this is even less a problem than for most types of stores - Amazon doesn't sell cars and almost 100% of the automobiles sold in this country are sold by traditional, brick & mortar dealerships.

Why Retailers Have Stopped Freaking Out About Showrooming
Read more: Showrooming & Holiday Shopping: Why Target, Retailers Embrace I... http://business.time.com/2013/09/20/why-retailers-have-stopped-frea...

Comment by Roosevelt Gist on January 6, 2014 at 1:19pm

Google recently post that 84% of mobile shoppers use their phone in-store. if your dealership offers wi-fi as a customer service we can help you combat showrooming by using that technology and generate more customer pay sales. enhance your wi-fi to a sales tool now. visit http://anproximitymarketing.com for the how to.

Comment by Joshua Pullan on January 6, 2014 at 1:16pm

Thanks for the feedback Tom! Better that he got it later rather than never!

Comment by Big Tom LaPointe on January 6, 2014 at 9:27am

great piece. a couple of years ago the best buy CEO did a talk and mentioned he thought "people are gathering information in our stores and buying online [paraphrased]". one of the biggest DUH moments I had experienced in a while. service and sales skill will go a long way to overcome this. The original quote: "Consumers armed with mobile phones are increasingly using stores as showrooms"

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