Showrooming: A Threat for Grocery Stores?

Online searching & shopping is great for convenience, but is it becoming a threat for retailers?

Online searching & shopping is great for convenience, but is it becoming a threat for retailers? The Food Institute Report recently noted that an Australian gluten-free grocery store called Celiac Supplies began charging a $5 fee for “just looking” online. The $5 fee is then deducted if you order anything from their website. This move is an attempt to prevent what's called "showrooming" of its products, as more and more retailers become threatened by the ease at which consumers can compare prices and products online. The notion that “showrooming” food products will hurt sales is very real for the grocery industry. According to Perception Research Services International 40% of consumers use smartphones while shopping for groceries. Considering 54% of U.S. adults responsible for at least half of their household’s grocery shopping have a smartphone, the potential audience for “showrooming” is significant. Some 53% of consumers surveyed, also noted using their smartphones to compare prices. This beats out a number of uses such as: reading customer reviews (49%), checking for sales & coupons (48%), and searching for product information (48%), notes the research firm. To help counter the impact of “showrooming”, Target announced year-round online price matching earlier this year. CITI Research notes that Target monitors prices of some 30,000 items to make sure it is competitive with most experts estimating fewer than 5% of customers actually ask for a price match. Thus, online price matching programs may be effective at gaining customer trust and loyalty without a high price tag.