Showrooming in Canada: The Price of Keeping Buyers In-Store

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GroupM Next teamed up with our colleagues at Catalyst Canada, the leading search marketing innovator, to expand our research efforts and gain a deeper understanding of consumer behavior in the Canadian marketplace.



This study examined consumer behavior in Canada as it relates to showrooming and revealed that a significant number of shoppers – 37% -- will leave a brick-and-mortar store and make a purchase online when the online price is just 5% lower than the in-store price. When the discount increases to 20%, lower than what’s offered at retail, the number of shoppers who leave and complete the purchase online nearly doubles to 73%.



Our whitepaper about this research details behaviors and factors that influence shoppers who price compare online while shopping in-store, and explores:

-- The combination of variables that factor into a consumer’s decision to purchase online rather than in-store

-- Demographic and behavioral traits that help identify shoppers who are likely to engage in showrooming – and how brands can capture this influential customer



-- Differences in behavior between consumers in the United States and Canada

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Showrooming in Canada: The Price of Keeping Buyers In-Store

  1. 1. Showrooming in Canada: The Price of Keeping Buyers in Store Jeff Lancaster, CEO Catalyst Canada catalyst.ca @jefflancaster
  2. 2. Study: Showrooming in Canada Download white paper now at: catalyst.ca/showrooming +
  3. 3. 46%54%
  4. 4. We Asked 2,000 People About The Winter Boots 13% for 2.5, 23% for 5, 48% shoppers would leave for 10% discount
  5. 5. How Big is Showrooming?
  6. 6. Impact Online Discounts Have On In-Store Purchases (Canada) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 0% 5% 10% 15% 20% %ShoppersStayingInStore % Discount Canada US Source: Retail Showrooming in Canada: Winning the Consumer and the Price of Keeping Buyers In-Store; Catalyst/GroupM Next, 2013
  7. 7. Immediacy
  8. 8. 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
  9. 9. What Consumers Consider 1. Size of the Online Discount 2. Familiarity with the online retailer 3. Shipping
  10. 10. Shipping • When we looked at 2 week shipping option (vs. 1 week) - 5% more consumers would simply purchase in store
  11. 11. 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
  12. 12. The Retailer Response
  13. 13. Responses to Showrooming 1. Pricing 2. Which Shoppers to target 3. Loyalty 4. Behaviours 5. In-store exclusives 6. Search 7. Mobile Apps 8. Geofencing 9. Control
  14. 14. Pricing In Canada staying within 10% of the price – gives you a fighting chance - Can your pricing become more dynamic to reflect market?
  15. 15. Price Matching
  16. 16. Identifying Your Targets
  17. 17. 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
  18. 18. Loyalty programs
  19. 19. 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)
  20. 20. In-Store exclusives
  21. 21. Where are you on Mobile Search?
  22. 22. Google’s new Enhanced Campaigns
  23. 23. Own search shelf for key products • Reviews • Best price • Compare • Cheap
  24. 24. Mobile app
  25. 25. Geofencing
  26. 26. Can you control the showroom?
  27. 27. 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
  28. 28. Thank You catalyst.ca @Catalyst_CA Download white paper today at: catalyst.ca/showrooming

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