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Mixed race woman having flamenco dress fitted by tailorRetail showrooming—when a customer visits a brick-and-mortar store to gather information, then purchases through another, possibly less expensive channel—is a problem for retailers. But there is a key question that many retailers forget to ask: Why would shoppers take the time to get in their cars, drive to the store, research the items, and not buy, especially when the item is a smaller ticket item or available for the same price online and in stores? According to one research team, the answer is that the store is driving them away, by failing to provide customers with employees who are knowledgeable enough to help them make their decisions. That is, when customers visit the store, they seek information that can help them make a purchase decision with confidence. They want to be confident that their choice is the one that will best meet their needs. To gain that confidence, they need information and reassurance from sales employees. The author provides an example of buying some technical hiking gear. A sales clerk who knows about, understands, and can communicate the various benefits and options available across different brands of hiking boots gives the customer confidence. A salesperson who is unfamiliar with what differentiates the different offerings instead leaves the customer unsure and unwilling to complete the purchase. Instead, this customer is likely to leave the store and visit an online site, in an attempt to gather more information. According to this research, training employees to ensure that they know about the different brands and products that the retailer sells can have a remarkable impact on sales. Although these authors are careful to offer various cautions about reading too much into the findings, they propose that just one hour of training can increase an individual employee’s sales by 5 percent. Combined, these improvements imply sales increases at the store level of approximately 23 percent. In general then, retail showrooming might not be evidence that customers are trying to exploit the retailer. Instead, it might be a strong signal that the retailer is not doing enough to ensure that its sales personnel are informed and helpful.


Source: Marshall L. Fisher, Knowledge@Wharton, September 1, 2015