45% of Customers Influenced to Ditch Store by 2.5% Online Discount

groupmnext-impact-online-discounts-in-store-shopping-august2012.png45% of customers would leave a store and buy a product online if they found it at a 2.5% discount while comparison shopping using their mobile device, details GroupM Next in an August 2012 report. At a discount of 5%, 60% of customers would leave, while at a 20% discount, 87% of shoppers would be moved to abandon the store. The research also indicates that the trend is similar for dollar amounts: when the difference is more than $5.00, a majority of most customers said they would leave the store.

Overall, about 1 in 10 shoppers surveyed said they would complete their purchase in-store regardless of the price discount.

While this appears to show customers as being extremely influenced by pricing – and by extension, to paint a difficult picture for brick-and-mortar retailers – the report offers another angle to the data. That is, if stores can remain within 5% of the online price, a large proportion of customers would complete their purchase in-store. Nevertheless, the data also indicates that even keeping within a 2.5% margin of difference would only hold the attention of a slight majority of customers.

These findings support a February 2012 study from ClickIQ, which revealed that among consumers who research and gather information in a retail store and then purchase online, price (86.8%) is easily their most common reason for “showrooming.”

Urgency Can Combat Showrooming

The GroupM Next report suggests that creating a sense of urgency around a purchase can potentially combat customers’ showrooming tendencies. The study looked at 10 product categories, and found that 1 in particular – headphones – were considered much differently by customers, who required a larger discount to leave the store when presented with a hypothetical situation of buying headphones. The report attributes this to respondents seeming to “assign an implied urgency with headphones,” noting that headphones were not the cheapest product of the 10 featured.

This ties in to results from an Oracle survey from November 2011, which found that while the leading reason US and Canadians visit stores is to see a product before they buy it (75%), a significant 44% visit the store when they need the product right away, suggesting that the immediacy aspect can be a powerful influence.

Showroomers Most Likely Young, Female

Further details from GroupM Next’s “Showrooming & the Price of Keeping Buyers In-Store” indicate that showroomers are most likely to: be younger; primarily female; have a lower income; and make frequent purchases online. The report also profiles customers dubbed “marginal showroomers” – who are sensitive to price but can be influenced to remain in the store. These showroomers have the following characteristics: they are more than 90% male; have an average age of 52; have a median annual income of $60,000; and almost universally (98%) hold some college or higher education. These customers are also seasoned online shoppers: 55% buy online once a month, while 21% buy one a week, and 11% more than once a week.

Other Findings:

  • Customers who compare prices in-store are likely to also comparison shop on their mobile device.
  • Customers who interact with an associate are 12.5% more likely to buy in-store.
  • 43.7% of shoppers surveyed use their mobile to shop while in-store.

About the Data: GroupM Next surveyed 1,000 US shoppers in conjunction with Survey Sampling International (SSI), asking about 10 products in multiple retail categories at varying price points. Shoppers surveyed were given hypothetical scenarios in which they could purchase a given product and own it immediately, or they could take a discounted price, leave the store, and have the product shipped.