‘Showrooming’ is a new piece of jargon that we’re all going to get tired of pretty soon. It refers to the practice of using a shop to browse and bone up on products, then buying from a cheaper online retailer.
Nothing new there…but this once-feared trend has in double quick time become a serious reality across almost all retail sectors, including the garden retail industry, thanks in part to the relentless march of smartphone and tablet technology, which makes it easy to check how the price of the product you’re looking at in-store compares to online sources. Only this week, the British Retail Consortium reported that in the fourth quarter of 2012, search volumes on tablet devices outpaced those on any other device, increasing by 238% and on smartphone devices by 76%.
A survey before Christmas by Real Business Today (realbusiness.co.uk) revealed that that one in five shoppers said they had researched online after a store visit – and nearly half of those ended up buying elsewhere. This, says Peter Ballard, author of an article that first appeared on foolproof.co.uk, means that “nearly 10 per cent of sales are walking out of the door as a direct result of showrooming activities. So it is no surprise that those retailers who seem least well equipped to deal with that loss are finding it hard to stay in business”.
He cited the demise of HMV as a prime example of what can happen next. “Almost their entire product line is easily found at lower prices on Amazon and other online retailers, and reliable and often free next day postal delivery, there are no compelling reasons to pay more just to own it today,”
Ballard concludes that HMV’s problem, like Comet, Jessops and Blockbuster, is that they failed to understand and respond to changes in consumer shopping behaviour.
Will the showrooming phenomenon affect garden centres, too? It already has. I have spoken to suppliers and retailers who have serious concerns about the way that online sales of garden furniture and barbecues are cannibalising garden centre outdoor leisure turnover. One supplier I spoke to has threatened to pull back from garden centres altogether, and a number of retailers have told me they are now questioning whether or not they should continue to sell garden furniture when all they have become is a showroom for internet traders.
Clearly, if garden centres want to remain serious players in the outdoor leisure category, they may be forced to play it differently. More staff with more detailed product knowledge – and a greater willingness to engage with customers in the sales process – will be required, as well as a more creative approach to display and merchandising. Retail theatre works for Christmas – the same principles now need to be applied to what passes for high summer in the UK.
But there is another debate to be had here. Just where do suppliers stand on pricing and distribution policies and online strategies?
There is a view within the Leisure & Outdoor Furniture Association (LOFA) that ‘showrooming’ is more of an issue for retailers to address than for suppliers. “A small number of our members also have consumer outlets and they tend to be of the internet type,” says LOFA’s Secretary, Phil Gibbs. “Our position is that, because the majority of items supplied by our members tend to be large and discretionary purchases, rather than impulse, consumers generally are more likely to want to be hands on in a showroom than to buy unseen online, and will purchase if the price is right. It is down to the retailers and suppliers to negotiate to get the prices right. In a way, our members per se are not as affected by it as retailers, because we have already sold the goods to the retailer.
Price, says Gibbs, will always be the leading driver but service comes into it too. “If you get good customer service and after sales back-up with good advice, you will be prepared to pay that little bit more."
But another trade show leader, Neil Gow of the Garden Industry Manufacturers Association (GIMA), who also owns the Fresh@burcot garden centre, believes ‘showrooming’ is already an ingrained consumer behaviour. “I wonder what these suppliers will think when they have no ‘showrooms’ left?” he said. “Online retailers are going to pick off more and more over the coming years, first furniture and barbecues, then garden tools, machinery, hoses and fittings and so on. How long before garden centres become just coffee shops selling a few impulse plants, compost, chemicals and a bit of giftware?”
- If you have a view, we'd like to hear from you. What is your attitude to suppliers who supply garden centres but also trade online, either direct to consumers or through other internet retailers? If you are a supplier, how do you square the differing demands of online and bricks and mortar retailing? And if you are a garden centre who also sells garden furniture online, how do you see it? We will publish your views in a future issue of GTN Xtra. Email your comments to: trevor.pfeiffer@tgcmc.co.uk or mike.wyatt@tgcmc.co.uk