Showrooming leading retailers to price-match

on Thursday, January 10, 2013

Showrooming leading retailers to price-match One of the latest consumer trends appears to be putting a dent in retailer profits and many are out to put a stop to the practice. "Showrooming" occurs when consumers enter a brick-and-mortar store to look at a product they're interested in purchasing, then search the web on their smartphones or tablets for better deals and merchandise reviews. As more people jump on the mobile trend, physical stores could be noticing an increase in the tactic and struggle to ensure their own supply chains can remain competitive.

Online retailers like Amazon and eBay have benefitted hugely from showrooming, but as other stores look to prohibit the practice, it could become less frequent.

Battling the trend
Retail giant Target announced a price-matching policy for the holiday season that would allow customers to get a better deal on their purchases for up to a week after their initial sale. The consumers would need their original receipt and an advertisement from a competitor showing the merchandise for a lower price. The chain recently revealed it will keep this policy in place permanently to better serve its consumers.

"We know that our guests often compare prices online," said Gregg Steinhafel, the company's president and CEO. "With our new price-match policy and the additional 5 percent savings guests receive when they use their REDcard, Target provides an unbeatable value." 

Enhancing service
Companies can look to battle showrooming; however, if they lack an efficient supply chain they may be unable to effectively cut down on the practice. A business should ensure its procurement policies are in order and able to withstand any supply chain stress to guarantee clients have access to merchandise at all times and are not driven to purchase online due to low inventory levels. Retailers should also employ proper supply chain management strategies that will help increase efficiency and better service customers.

Getting ahead with such policies may also help a company looking for cost savings across its operations. Better sourcing and procurement can lead to lower expenses, and proper management can ensure production and logistical programs are in order and cost effective. Retailer working to employ these techniques to curb showrooming in their stores may find they are able to enhance sales and consumer satisfaction, as well.

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