showrooming in canada: the price of keeping buyers in-store

Showrooming in Canada: The Price of Keeping

Buyers in Store

Jeff Lancaster, CEOCatalyst Canada

catalyst.ca

@jefflancaster

Study: Showrooming in Canada

Download white paper now at: catalyst.ca/showrooming

+

46%

54%

We Asked 2,000 People About The Winter Boots

13% for 2.5, 23% for 5, 48% shoppers would leave for 10% discount

How Big is Showrooming?

Impact Online Discounts Have On In-Store Purchases (Canada)

0% 5% 10% 15% 20%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% Discount

% S

hop

pers

Sta

yin

g I

n S

tore

Canada

US

Source: Retail Showrooming in Canada: Winning the Consumer and the Price of Keeping Buyers In-Store; Catalyst/GroupM Next, 2013

Immediacy

The Value of Discount Matters Too

$15 discount: majority of Canadians will leave and buy online$5 discount: US consumers will leave and buy online

What Consumers Consider

1. Size of the Online Discount

2. Familiarity with the online retailer

3. Shipping

SAVE $25

Shipping

• When we looked at 2 week shipping option (vs. 1 week) - 5% more consumers would simply purchase in store

Other Factors 1. Different language markets

2. Whether consumers would be “in-market” for the product or not

3. Presence of Children

4. Use of Public Transportation

The Retailer Response

Responses to Showrooming

1. Pricing2. Which Shoppers to target3. Loyalty4. Behaviours5. In-store exclusives6. Search7. Mobile Apps8. Geofencing9. Control

Pricing

In Canada staying within 10% of the price – gives you a fighting chance

- Can your pricing become more dynamic to reflect market?

Price Matching

Identifying Your Targets

Who Are the 10% to Win Over?- Created statistical model to rank shoppers from likely to stay to

unlikely to stay

The 10% to win over are:- Slightly more likely to be female- Average age = 58 years old- Median income = $50,000 annually- Half have some college or higher education.

Casual online buyers:- 38% buy only once per year- 53% buy online once per month- 5% once per week- 4% more than once per week

Loyalty programs

What In-Store Behaviors To Target?

When a shopper…

- Compares alternatives + - reads reviews on mobile phone

= Less likely to stay in-store

- Talking with an associate make them more likely to buy in-store (12.5% more likely)

In-Store exclusives

Where are you on Mobile Search?

Google’s new Enhanced Campaigns

Own search shelf for key products

• Reviews• Best price• Compare• Cheap

Mobile app

Geofencing

Can you control the showroom?

Next Steps for Retailers

- Understand your customers

- Develop a mechanism to understand the online marketplace

- Extend the conversation beyond price- Loyalty, search, apps, behaviour, control

Thank You

catalyst.ca@Catalyst_CA

Download white paper today at: catalyst.ca/showrooming