We have a Best Buy close by and I hope that they don't close. We just bought DH's main Christmas present, a Nikon D5100 camera and the bundle package. We bought our Mac laptop, Mac Desktop, printer, refrigerator, big screen TV and surround sound system and many smaller items. They did the price matching with the refrigerator and we could get it quicker with them and they took away our old refrigerator. They ended up having to take our kitchen door off the hinges and put it back on. They were very polite about it. I was the only adult at home and had my young grandchild, I think she was around 18 mos or 2 yrs at the time, so I was not any help to them at all.
"Showrooming" Whaddya Think?
- Thread starter Midpack
- Start date
BigMoneyJim
Thinks s/he gets paid by the post
BnM retailers need to stop whining and adjust. I'm sure I'm not the only one who uses Amazon, NewEgg and others for reviews and research and then buy local on big ticket / bulky items, even allowing for higher local prices for the convenience and returnability.
As noted many times in this thread, Best Buy has done many things to alienate customers. I almost never go there to shop now, but I have occasionally bought a big appliance there with 0% financing. Maybe they're better now, but I wouldn't know because I've hardly been there the past 5 years. 15-20 years ago they were my primary tech shopping place, but they booted themselves out of that position.
I would carefully plan it to be efficient and scalable, and then go out of business within a year because some kid who skipped college opened a store closer to the customer with free WiFi and other amenities to entice customers in and buy from him instead. Or some similar story where my engineer brain is easily outclassed by a poufy chair lounge and free muffins or something. Retail isn't about distribution efficiency.
More BnMs will fall on their face, but I can't imagine not having a physical showroom for many items; somebody will figure it out, and it probably won't be an engineer.
Walmart and Target are (relatively) cheap, and people are already there picking up their milk, cat food and toddler sneakers. Costco has a large selection of TVs and has developed a reputation for picking quality items where they have only one or two choices. Who goes to RadioShack? Game Stop was a cool idea, but more and more games are downloadable, and Craigslist and eBay fill the used equipment market. (I would miss Game Stop, though.)
Repeating myself, more bricks will fall, but somebody will figure out the magic combination of physical showrooms and profit. At some point a lack of physical stores would hurt online business.
Yeah, Fry's. Weird store. Hate it but couldn't live without it. (Maybe a little hyperbole there.) Lots of tech/electronics and pricing games. You pretty much have to play offline/online against each other to shop for value there, but the selection is good, and on any given weekend the price for the item you want could be right.
Had a similar experience with a WD external drive bought on sale somewhere (?) with likely lost receipt. Serial number and postage got that replaced.
Pssst...Mouser Electronics, Mansfield, TX.
Heck yeah, reverse-showrooming! xkcd: Reviews
Edit: Ok, that's creepy. I finished posting and switched over to the tab I opened The Onion RadioShack article in, and the ad at the top is for Mouser Electronics. I thought I had opened that tab before I found Mouser's site...I think the Internet is predicting my surfing now rather than reacting to it.
As noted many times in this thread, Best Buy has done many things to alienate customers. I almost never go there to shop now, but I have occasionally bought a big appliance there with 0% financing. Maybe they're better now, but I wouldn't know because I've hardly been there the past 5 years. 15-20 years ago they were my primary tech shopping place, but they booted themselves out of that position.
I would carefully plan it to be efficient and scalable, and then go out of business within a year because some kid who skipped college opened a store closer to the customer with free WiFi and other amenities to entice customers in and buy from him instead. Or some similar story where my engineer brain is easily outclassed by a poufy chair lounge and free muffins or something. Retail isn't about distribution efficiency.
More BnMs will fall on their face, but I can't imagine not having a physical showroom for many items; somebody will figure it out, and it probably won't be an engineer.
Walmart and Target are (relatively) cheap, and people are already there picking up their milk, cat food and toddler sneakers. Costco has a large selection of TVs and has developed a reputation for picking quality items where they have only one or two choices. Who goes to RadioShack? Game Stop was a cool idea, but more and more games are downloadable, and Craigslist and eBay fill the used equipment market. (I would miss Game Stop, though.)
Repeating myself, more bricks will fall, but somebody will figure out the magic combination of physical showrooms and profit. At some point a lack of physical stores would hurt online business.
Yeah, Fry's. Weird store. Hate it but couldn't live without it. (Maybe a little hyperbole there.) Lots of tech/electronics and pricing games. You pretty much have to play offline/online against each other to shop for value there, but the selection is good, and on any given weekend the price for the item you want could be right.
Had a similar experience with a WD external drive bought on sale somewhere (?) with likely lost receipt. Serial number and postage got that replaced.
Pssst...Mouser Electronics, Mansfield, TX.
Heck yeah, reverse-showrooming! xkcd: Reviews
Edit: Ok, that's creepy. I finished posting and switched over to the tab I opened The Onion RadioShack article in, and the ad at the top is for Mouser Electronics. I thought I had opened that tab before I found Mouser's site...I think the Internet is predicting my surfing now rather than reacting to it.
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The most appropriate adjustment, though, may be to close the showrooms. It may be hard to compete against Amazon.com online, but is much harder to complete as a B&M store when the vast majority of people walking through your showroom and taking up your staff's time with questions are Amazon.com customers using your showroom to check out what they're going to buy on Amazon.com. If it gets to a point where Best Buy realizes that there is no profitable aspect to incurring the costs of the showroom, then simple business logic says that that cost must not be incurred.
I believe even that is becoming a rarity. Anything small enough to carry into a Best Buy for a return, is small enough to ship back to a returns center. The UPS Store has effectively become a local B&M location for Amazon.com. And nothing is more convenient than having something - practically anything - delivered to my front door within two days.
We've bought a big-screen television from Amazon.com, and wouldn't think twice about buying anything else from there.
The Best Buy here replaced a Circuit City, so my experience with Best Buy is limited to the last six or seven years. What I've seen them do, in the vein of "alienating" customers, is try to keep costs in line with the benefits of those costs. The average customer service experience is not what it should be because of simple mathematics: If customer purchases represent $X worth of value, then costs need to be something less than $X. If the costs are fairly divided between the customers who's purchases represent that $X worth of value, then the service will probably be considered exemplary (especially these days). Split that service quality to account for what might be a majority, or a vast majority of cost going to serve customers of Amazon.com, and suddenly everyone is getting inferior service.
And I'm not saying that Best Buy doesn't screw up or isn't making fundamental mistakes with its service systems. What I'm saying is that even if they're doing it perfectly, the deck is stacked against their providing good service.
This is a good point, and really the only way out for any seller who wants to go the B&M route: You need to create an experience - a purchasing experience - that customers will value more highly than the product they're buying alone. Those are great words, and they look slick on [-]paper[/-] screen, but think about what they mean: It means that the way to succeed in a B&M model is to charge customers for more than just the product. It means you need to get them to be willing to pay you what they're willing to pay Amazon.com for the product - call that your loss-leader, because you as a B&M store cannot compete with Amazon.com's lower overhead costs - and willing to pay you extra for the overall experience of purchasing. And not just a little extra, but so much extra that that extra amount covers your loss on selling the product itself, covers the cost of providing the special experience, and provides you some profit. That's a tall order.
It is basically retail "first class". And while first class airline travel is a major component of airline business models, most of us still cram ourselves in the back of the airplane to save money. We cannot complain that the folks sitting up-front get a better experience than we get - after all, they're paying more for it. And carrying this back to retail, so many of us are as fixated on getting the lowest price (best value) for what we're buying as we are on getting the lowest airfare that we don't allow ourselves to put a price on the service we get, on how liberal the terms and conditions are, on how superior the showroom buying experience may be (and the latter perhaps only because we know, right now, we can enjoy that benefit without paying for it).
The other way folks get to sit up-front in the airplane is by demonstrating a willingness to put aside rabid price fixation enough in the past to show brand loyalty. That willingness to pay a bit more is important and something we Americans (at least) are generally unwilling to do, at least not in sufficient numbers to turn the tide against the race to the bottom. Airlines even have their own version of this "showrooming" problem - customers who are so fixated on price that $10 one way or the other will make a difference to them. As a result, some even have stopped providing credit toward elite frequent flyer status for super-low fares. We consumers talk a good game about service quality, but we really don't, collectively, put our money where our mouth is.
It's not unheard-of, though: Apple is the exception that proves the rule, in many respects. My cousin is a rabid Apple fan. I think he met his new wife because of the rabid fandom that Apple fosters. But sit an Apple laptop next to a Lenovo laptop, and put them through functional testing and usability testing, with folks who aren't affected by Apple's [-]snow-job[/-] marketing, and Apple is unequivocally "over-priced".
I'm interdisciplinary. I spent a career on the business side of things, learning how literally hundreds of companies balance customer behaviors with profits and possibilities, and then when the insane travel got to be too much for me, gave it all up to be a software engineer. One thing I learned from both my careers is that there actually are unsolvable problems. We like to poke the troops with the faux-inspirational "nothing is unsolvable" mythos, but that's actually only true when you leave most of the variables free to vary. When you define boundaries on all the significant variables (money, time, and quality) you can easily craft problems for which there is no solution whatsoever.
And like it or not, as a business manager you can set goals and objectives all you want but if you constrain all the variables, what's going to happen is that the variables you actually can directly control (i.e., in the triad above, money and time) will be respected, at the expense of the variable you actually cannot directly control (i.e., quality). In simple terms: Rush less accomplished staff and you get crap.
OP
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Midpack
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
That was the central point to me and the central question is do people who take advantage of BnM service/knowledge AND then buy online (all premeditated) realize they may be forced to buy everything sight unseen if they keep it up? Will they live to regret it? Frankly, I'm afraid they are and they will regret it...but it will be too late.
Another central point IMO. Do folks who criticize BB (or other retailers) service realize they accelerate the demise of service by showrooming?
Once again the central interesting question IMO. I'm afraid most people are taking advantage of BnM retailers and will live to regret it. Charging a (justified) premium for service seems to be less and less viable, but I hope I am wrong. Apple & Nordstrom come to mind as exceptions, though Apple may be enjoying a fashionable status that won't endure. There have been lots of premium retailers who failed once the crowd moved on to the next fashion leader.bicker said:
There's no answer, time will tell...
I don't think that that reflects the actual calculus of those who are aware: There are a whole mess of "tricks, tips and techniques"-sharing out there -- whole websites devoted to it (and this website substantially so) -- and folks taking advantage of those resources generally consider themselves wise for doing so. "Let some other sucker pay full price - I'm going to use this arcane insight to pay less."
We hear many stories of how this drives the marketplace in a direction that will end up being arguably bad for all. Cut-rate airfare bargain-hunting has led to unbundling of fees, such as for checked baggage. "Sharing" CDs has led to annoying DRM on other types of digital media. Coupon commandos have been known to walk out of grocery stores with carts full to the brim, paying practically nothing - a perfectly legal exploit that nevertheless results in higher prices for those who don't capitalize as consistently on promotional discounts. Rental car companies have recently gotten much more stringent, dinging drivers for even the most trivial of damage, because so many drivers in the past would return cars with real damage that they didn't own up to. Universal Studios theme park now sells a special pass that lest you jump ahead of everyone else in line for a ride - what happens when everyone has one of those special passes? And so on...
I wonder, though, to what extent that's true.
First, some changes take time. My grandparents probably participated in common consumer behaviors that drove the marketplace in a certain direction, but the true negative ramifications of those changes weren't really felt until they had passed away. I'm sure we're all contributing to changes that will lead to negative (as well as positive) ramifications for our grandchildren.
Second, I doubt those "most people" you were talking about will put forth the effort to -- or even if they did, will be readily able to -- see the causal relationship between specific consumer behaviors they participated in and changes in the marketplace that they consider negative. I find many of the strongest advocates for the "tricks, tips, and techniques" I alluded to above are also the strongest apologists, denying accountability for the ramifications of what they promote. I know of no one who actively avoids engaging in all such exploitation of what's legally available for the taking. There are basically two groups of people: Those who don't care, and those who care but will do what's best for themselves in the short-run because the fact that so many other people do so would put them as an utterly unacceptable disadvantage if they did not participate as well.
I was going to point that out, if you hadn't. You're not really paying extra for better service, but most of the premium is for the privilege of being able to put yourself into the mythology they've created. There is perhaps as much commonality between what you're buying between Apple and Disney or Dreamworks as between Apple and Samsung or Dell.
OP
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Midpack
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Interesting, thanks for sharing. On this one...
While the two groups have always existed, I think the balance has shifted dramatically, many more who "don't care" now IMO (which shifts the probability of what may happen). However, I've been predictably shouted down for that here before (by the same members each time), and I can't prove it to everyones satisfaction, so I won't argue. We agree to disagree where applicable...
OP
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Midpack
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Interesting related article on the demise of BnM, not about showrooming specifically though...
The Death of the American Shopping Mall - Jobs & Economy - The Atlantic Cities
The Death of the American Shopping Mall - Jobs & Economy - The Atlantic Cities
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Throughout the 20th century, the US was still expanding its exploitation of its military and economic power worldwide to grow our nation's aggregate standard of living. We've grown up a bit, I think -- I doubt the US would explode nuclear weapons over two heavily-populated cities to end a war, these days, as we did in the last century. And the rest of the world has grown up a bit -- learning from us how to build power for themselves. I doubt that the world as a whole, today, would sit back and take what they took from us in the last century, as they were forced to, then, because there really was no way to pull together enough power to hold the US to account for -- really, anything, back then.
I'm not necessarily criticizing what we did or how we did it, back then (or if I am, it's not relevant to what we're talking about here), but rather pointing out that things have changed in the world and so that portion of our aggregate standard of living attributable to the manner in which we exploited military and economic power in the last century will naturally be going away. We can replace some of what we will invariably lose, from not exploiting the rest of the world as much as we have in the past, with innovation (green energy perhaps), but we've always had all three things working in our favor, full-throttle on all three. Now we're full-throttle on innovation (let's hope) and using power in a more measured and conscientious manner.
So how is this relevant? It comes down to pressure. Imagine you're on a roller coaster. The ascendancy of US power is like zooming down that first hill on a roller coaster. The more recent moderation of US power by both conscientiousness on our part and other nations learning from us how to gain power for themselves - that's like hitting that first uphill after the first downhill on a roller coaster. Guess where we are. After fifty-five years of experiencing the euphoria of the veritable weightlessness of relative prosperity in the nation, we hit the button of the downhill (1987) and now we're going to have to get that momentum up to get over this next uphill.
People figuratively "feel" that pressure. They feel it in many ways. We recognize it when we admit that our children may be the first generation less well-off than their parents. We probably don't like to think about the fact that much of that is because we've mortgaged their future so much. But regardless, we feel the pressure. And it drives our behaviors. That pressure motivates many people to cut corners that perhaps they wouldn't have cut in the 1950s - to be less community-minded and less kind to neighbors than they would have been in the mid-1990s, even. We're still climbing up that next uphill, and most of us don't even recognize that the downhill fun is already over, much less recognize that there is the necessary "pain" of the uphill to contend with.
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FinanceDude
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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- Aug 3, 2006
- Messages
- 12,483
Best Buy is floundering, yet an upstart chain like HH Gregg is booming, can't open stores fast enough. Wide aisles, plenty of help, limited inventory, yet they make it work. You can't buy video games or movies or stuff like that there, because there is no margin in it. I predict as Best Buy closes stores, HH Gregg will take them over. Best Buy is doing the same thing Boston Chicken did many years ago, expand when times are good and hope times stay good...........
I make almost all my purchases of major electronics online. Amazon is killing Best Buy. While it is true that WalMart and others do not stock the good stuff that Best Buy does, WalMart's online has almost anything you would want. I bout DW an Ipod 4 touch for X-mas, WalMart's price killed everyone else.........
I make almost all my purchases of major electronics online. Amazon is killing Best Buy. While it is true that WalMart and others do not stock the good stuff that Best Buy does, WalMart's online has almost anything you would want. I bout DW an Ipod 4 touch for X-mas, WalMart's price killed everyone else.........
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For what it's worth, though, HGG isn't necessarily doing that much better than BBY, and HGG has its own internal problems. According to Forbes, HGG posted declining sales for the six months ended September 30, and posted a loss of nearly $2 million. They are growing by making less money in more and more stores, incurring higher and higher costs to make less and less profit.
However, fair notice: My ability to qualitatively compare financial statements and other analysis of individual companies is somewhat limited.
However, fair notice: My ability to qualitatively compare financial statements and other analysis of individual companies is somewhat limited.
martyp
Thinks s/he gets paid by the post
I treat the big box stores like I buy cars. I use the internet to do my research which means I'm not really depending on the salesperson to know anything and I give them the least amount of opportunity to steer me the wrong way. When my Tivo DVR died last year I just found the model I was looking for on the internet and then called around to find the BestBuy that had one in stock because I was in a hurry to get back online with the TV. I used them like a delivery warehouse. If I want customer service, such as in buying a major appliance, I'll go to a locally owned establishment. I'm usually looking for quality and value rather than the lowest price. Several years ago I bought my flat screen TV at BestBuy because I was nervous about doing it through the mail. I expect that places like BestBuy will continue to struggle but in ten years they will be a thing of the past.
Am sulking... My post #31... was a boiled down result of a $5 million study financed by Exxon Mobil, that I was involved in in the very early 1980's. Based on a quarter century of retail experience, I still see this as the future of the industry. The penultimate "showrooming".
No one to discuss this with here...
Am sulking... My post #31... was a boiled down result of a $5 million study financed by Exxon Mobil, that I was involved in in the very early 1980's. Based on a quarter century of retail experience, I still see this as the future of the industry. The penultimate "showrooming".
No one to discuss this with here...
I reread your post #31. I don't know anything about retail but in 1980 I doubt the internet was part of the equation.
Would have just been Exxon in 1980. I don't know what they were doing in retail then. I know Mobil owned Wards for a while back then. Oil company management did not work out so well in retail.
RE Exxon... Correct... It was Mobil then, and Mobil's connection with retail, came from it's purchase of my company... Montgomery Ward, back in the 1970's when Mobil had to buy something to offset its' windfall profits from the gas crisis.
The study was commissioned as as an attempt to "catch up" with the then rising star Walmart.
For anyone who remembers Service Merchandise, this was the original meaning of "showroom"... thus the reference to Trade shows... which are "Showrooms".
Most here are too young or don't really understand retailing. Walmart essentially introduced several radical concepts that counted toward their success.
Minimal stock - daily replacement of sold goods.
Electronics - Scanners, Computer based ordering, departmental control.
Central Warehouses- Circled major markets away from major cities
Random access Warehousing-
Centralized management
Buying power -
The use of electronic technology to robotize people actions, from management to physical actions.
Our study led to to Showrooms... Where customers could be exposed to samples... to try, feel, and see... along with people who know and understand the product.
The warehouses would be bigger than anything now in use. Mechanized. Shipments a mix of UPS equivalent or direct to the Showroom for warehouse pick up.
A system infinitely adaptable to any number of SKU's... Instead of One or two hundred thousand items, perhaps a million or more. Easily handled in the framework system.
Think Amazon on steroids... centralized in the malls that are currently being skeletonized. Think of megawarehouses in Houston to serve Texas... In Portland to serve a 300 mile radius. In Denver to serve the Central states...etc... Then think of the current Super Malls.... replacing the 100 stores with 1000 showrooms, each as "showrooms" with no stock except the samples.
The coming year will see hundreds of malls turned into money losing ghost towns.
That is what we were looking at back in the 1980's. Walmart basically did this. In their own way. Their sales are now larger than the next 7 largest retail stores combined.
..............................................................................
The showroom would be symbiotic with online retailing.
The study was commissioned as as an attempt to "catch up" with the then rising star Walmart.
For anyone who remembers Service Merchandise, this was the original meaning of "showroom"... thus the reference to Trade shows... which are "Showrooms".
Most here are too young or don't really understand retailing. Walmart essentially introduced several radical concepts that counted toward their success.
Minimal stock - daily replacement of sold goods.
Electronics - Scanners, Computer based ordering, departmental control.
Central Warehouses- Circled major markets away from major cities
Random access Warehousing-
Centralized management
Buying power -
The use of electronic technology to robotize people actions, from management to physical actions.
Our study led to to Showrooms... Where customers could be exposed to samples... to try, feel, and see... along with people who know and understand the product.
The warehouses would be bigger than anything now in use. Mechanized. Shipments a mix of UPS equivalent or direct to the Showroom for warehouse pick up.
A system infinitely adaptable to any number of SKU's... Instead of One or two hundred thousand items, perhaps a million or more. Easily handled in the framework system.
Think Amazon on steroids... centralized in the malls that are currently being skeletonized. Think of megawarehouses in Houston to serve Texas... In Portland to serve a 300 mile radius. In Denver to serve the Central states...etc... Then think of the current Super Malls.... replacing the 100 stores with 1000 showrooms, each as "showrooms" with no stock except the samples.
The coming year will see hundreds of malls turned into money losing ghost towns.
That is what we were looking at back in the 1980's. Walmart basically did this. In their own way. Their sales are now larger than the next 7 largest retail stores combined.
..............................................................................
The showroom would be symbiotic with online retailing.
OP
OP
Midpack
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
For some items or services, online is an easy choice. But would you be willing to buy EVERYTHING online sight unseen? Using your example (but please don't get hung up on the details of one item), what if you could no longer buy "major appliances" at a "locally owned establishment," and your only option was online? That's the question...
I'm not that far away from that, Midpack. Heck, I happily bought our big-screen television online, and had a better appreciation of the purchasing experience than our first big-screen which we bought at Circuit City years earlier. I'm really not quite sure what I could get out of standing in a showroom with a washing machine or dryer to make myself feel more comfortable that I'll be happy with the purchase. The specs are available online, and the physical presence in the same room doesn't really do much for me. I need to use the sucker to get much out of the experience sharing time with it. That's when you find all the nasty little secrets.
And that's one thing that Amazon.com helps out with quite a lot. More so than any other source, I trust their (certified purchaser) reviews. I gain far better insights into what I'm going to encounter using the device from those reviews than I would get from touching an item on a shelf in a store.
And that's one thing that Amazon.com helps out with quite a lot. More so than any other source, I trust their (certified purchaser) reviews. I gain far better insights into what I'm going to encounter using the device from those reviews than I would get from touching an item on a shelf in a store.
Lsbcal
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
On my last trip to Best Buy a few months ago things went pretty well. They had reworked the store and it looked a lot better. There was no annoying loud music playing.
I had looked up routers on Amazon and read the reviews and sort of knew the pricing. The Best Buy guy answered most of my questions before drifting off somewhere else. I'd rate him a B for sales effort -- maybe I was hitting the limits of his knowledge with my questions although I'm no expert in that area. I bought the Netgear router on that trip.
When I go there it is on the weekdays and in the morning to get the best attention, hopefully.
Took a look at the BBY stock. Not pretty but not in single digits yet.
I had looked up routers on Amazon and read the reviews and sort of knew the pricing. The Best Buy guy answered most of my questions before drifting off somewhere else. I'd rate him a B for sales effort -- maybe I was hitting the limits of his knowledge with my questions although I'm no expert in that area. I bought the Netgear router on that trip.
When I go there it is on the weekdays and in the morning to get the best attention, hopefully.
Took a look at the BBY stock. Not pretty but not in single digits yet.
BigMoneyJim
Thinks s/he gets paid by the post
I don't see it as an extinction, if I may [-]set up a strawman[/-] rephrase your point.
Before the Internet was full of (semi-) trustworthy reviews on everything from socks to TVs I went from store to store comparing items and prices. Sometimes one store would have a display of the exact product I decided upon, but another store had it cheaper, and I went to the cheaper store. I went to used car lots to scope out car models I was more likely to buy from an individual via the newspaper classifieds. I'm sure I wasn't the only one.
There has always been competition. I don't recall having bookstores with embedded coffee shops, lounge chairs and board games where people are implicitly encouraged to hang around and read for free before Barnes & Noble, but I know of no other B&M type of (new retail) bookstore now (university bookstores and used bookstores notwithstanding, although some of those follow the Barnes & Noble model, too). B&N did something seemingly counter-intuitive by encouraging people to lounge around and read their books for free and ruled the B&M book retail world until Amazon.com got going.
And while finding cars for sale from individuals is easier now with the Internet, I bought my last car from Carmax and plan to buy my next one from them. They have a huge selection, built a reputation, and I'd now rather do business with them than try to figure out which individuals are sincere and which are "curbside dealers" who are flipping cars of unknown quality. As long as the price is inline with the benefit. In my last deal I figured I paid a bit more than I would have from an individual, but the loan and paperwork went very smoothly, and I like the no-haggle setup, and I have a better trust factor with them than many individuals.
I used to buy electronics at a store call Best, or a place called MacDuff's I think, and one other place...maybe it was Wards. (And Service Merchandise a time or two...you're welcome.) When Best Buy was new they had better overall pricing, and their no-interest financing was handy. A Best Buy credit card is the only store card I kept and used for an extended period of time, and I did much of my electronics shopping there for years. Later some other places opened up and BB wasn't as competitive, and they did a couple of things to annoy me. So yeah, I'll complain about them. But I will add it's been a few years since I've compared prices and policies there, so maybe they're better now. Nowadays I usually price things at NewEgg and go to Fry's. Sometimes Fry's is cheaper, sometimes I buy there even if it's a bit more, but sometimes it's almost twice as much. Like I say, Fry's is weird and they change prices a lot, but I shop there as long as I can compare. For a while it was all Fry's-or-NewEgg.com for me, but lately I've found deals other places including Amazon, Target and Wal-Mart.
The point I'm failing to illustrate is that things will adapt. I think bookstores are an endangered species...I just don't know if there will remain enough of a demand support retail B&M new-bookstores. But for other items I think enough of a market will remain of people who want to touch, feel and try out before buying. I generally want to try out consumer electronics in the store, and certainly large appliances. (I was going to include clothes, but then again I could probably last quite a while just reordering the same lines of shoes, pants and work shirts I've been wearing.)
I don't know how things will look in 5-10 years. Here are some possibilities that jump to mind:
- Super stores like Wal-Mart and Target absorb any "showroom penalty" and make enough sales from the showroomer traffic to make it worthwhile
- Online retailers open showroom stores; perhaps they sell stock from the stores, or perhaps it's order-only
- Localized or regional truck/van companies cover the retail equivalent of the "last mile" in telephony terms (from the TelCo central office to your house) from the local/regional distribution warehouse and avoid long-haul parcel shipping costs, and I'm thinking these companies are independent and serve several online retailers' warehouses
- Brand names open their own showroom stores. Disney, Microsoft, Apple...these are largely already showrooms for other distribution channels and partnered services. Ikea may already fit this model. This way the brand controls the presentation of their product.
- Only a few big-box B&M retail chains survive, and specialty value-added shops fill in the reduced market for customers who want/need to try out the product and get in-person assistance with it.
- Rampant shilling causes most review sites to become untrustworthy, and there aren't enough trusted sources to cover all products, so consumers shift purchasing back to retailers with solid return policies, brand names that maintain a reliable reputation or stores with knowledgeable and helpful staff
Carmax is a huge place, and while there are three of them in my area, it's a pretty big area and there are probably a couple hundred or more other new/used car dealers in the same area, many of which are closer to me. But I noticed they got a small pad lot and have a remote sales office in a neighborhood distant from their stores. I haven't been inside, but it looks like they'll help you search their stock and even have a small car-hauling rig (looks like it holds 2-4 cars) bring the car to the remote store for inspection and presumably complete the sale onsite if sold. The lot is about as big as an average fast-food lot, an including customer and employee parking there look to be about 15-20 spaces, so I don't imagine they keep any stock sitting on their tiny remote lot. If a (mostly used-) car company can manage to maintain a remote showroom--I'm guessing there's more than one, but I've only noticed the one--I'm guessing new-item retailers and/or brand can manage to do the same if their B&M retail channels falter so much as to impact their meatspace presence.
All that said, I do feel I have some loyalty if there is a value. I value ease of return to a local store with good return policies, especially with bulky and/or expensive items. I can't recall offhand buying an item online if I felt I needed the showroom tryout to make a decision or if I needed advice from the employee, although I may have done so. I live alone, so I have some concerns about parcel delivery during the day when I'm not home. I don't want to leave an expensive item on my front porch, and I don't want to advertise that my house is empty during the day. (But beware of attack cat!)
But lets say (what I think are) your worst fears happen, that rampant showrooming and bargain chasing drives B&M category store chains out of business, and then the hordes of showroomers then invade big-box stores and specialty retailers and start reducing their ability to serve paying customers. At some point the retailers will implement a way to stop the showrooming or enough will go out of business that overall sales will be impacted because buyers don't have the confidence to buy without the showroom experience. After that happens, somebody--the product brands or the online retailers...heck, maybe even a distributor or two--will experiment with their own B&M showrooms to stimulate sales. In this scenario there is probably plenty of empty retail strip-mall, mini-city-mall and traditional indoor mall space available for such showrooms.
I just thought of another possibility: maybe instead of showrooms, a brand or retailer sponsors select homeowners or businesses that then act as localized showrooms. Perhaps Kenmore supplies my house with the latest refrigerator, washer/dryer, gas range and outdoor grill and has me host weekly or monthly product demo parties. Perhaps Black & Decker equips a lawn care team and demonstrates their products by doing lawns on successive blocks. Or maybe it's like some of the specialty bed/vacuum/other home products that offer a free in-home trial.
I don't think "absorb" really captures it. There's going to be a cost, and it's going to end up being paid by those who choose to patronize those stores. As things are now, they pass that cost along in the form of less technical know-how, far more limited choices, etc.
I don't see this happening. Amazon.com has made a clear choice to expand its footprint in the direction of more distribution centers, focusing on getting to the goal of same-day delivery, not opening showrooms. And now that Google seems to be heading toward directly competing with Amazon.com someday, I think we can expect to see online retailing to get more "big box store-like" (in other words: less focused on helping customers check out a product so that they can then go and buy it from their competitor).
That's already well underway, and it is actually worse than you've described. They are not only independent from the retailers (a good thing) but their delivery staff are practically all "independent contractors" - i.e., people so desperate that they're willing to work for small compensation, no benefits, paying for their own delivery vehicles, managing their own expenses thereof, etc. My spouse does a lot of ordering from Drugstore.com and we've "lost" a couple of packages already this holiday season. They were picked up by Lasership, but never arrived on our doorstep. Strange that every single UPS package makes it here.
This definitely sounds viable, but think about the context: These showrooms only will exist to showcase premium products. Samsung will have a showroom to show-off their magnificent 9000 Series televisions, but Insignia won't have a showroom to help customers realize how much crappier their cheaper televisions are, and Vizio will avoid having a showroom because they don't want all their customers who were told to "buy a new television" when the display in their year old Vizio died to come in and make a stink.
There will always be a place for the super-deluxe customer, but you don't need a public showroom for that. How then? The key, for any consumer-facing business, is how to segment the market. Someone serious about buying a major appliance, who wants superior service, won't blink twice about evaluating the "big box consultants" offering their services to the market, and then agreeing in advance to pay them for their services (regardless of what is purchased from where). They already do this with architects and interior decorators. So given that, these "consultants" can have consumers make an appointment to bring samples to their home, to try out for a few days perhaps, at least for smaller items, and have a private showroom for larger items.
And unfortunately, the budget, affordable and even (non-super) premium customer doesn't have access to showroom services that way.
Amazon.com has that addressed, at least for now, by labeling the reviews that they certify were posted by people who actually purchased the product. Sure, the manufacturer can go onto Amazon.com, purchase their own product, and post a review, but that's just one review. The only way for the manufacturer to make profit on the arrangement (as opposed to just padding Amazon.com's coffers) is to have the number of real customers making purchases far outnumber their own "shilling" purchases, so invariably (as things are working out today) the vast majority of certified reviews are almost surely genuine and sincere.
Furthermore, Amazon.com's generous return policies also help in this, though admittedly that could change over time.
As I indicated before, for premium products from premium brands, perhaps, but that's going to leave the vast majority of purchases (including all bargain-hunting) out in the cold. What's going to happen? I think that people (especially bargain-hunters) will (a) take a lot more risks than they've had to in the past, and have no choice but to accept the consequences; (b) rely much more heavily on neighbors and friends for recommendations, though that will still result in a sharp narrowing of "available" choices (i.e., those that some friend took a chance on and was pleased with - a substantially smaller range of choices indeed), and therefore will likely result in some significant sub-optimization for the budget consumer. Given that showrooming, itself, represents budget consumers gaining benefits that they end up not paying for, this sub-optimization makes sense - it reflects the system re-balancing itself in response to the imbalance that showrooming itself brought about.
. Thanks...
Katsmeow
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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I don't think it's the end of the world. In an ideal world I could look - in my home - at every single product I want to but before hand and then I could pick out what I want and instantly receive it.
But that ideal world never existed. Before online - you were limited by where you [-]could [/-]were willing to drive to and by the selection that existed in that store. Way back when I bought all my computers at bricks and mortar stores. Now, I don't. Why? I get better selection and more choices by buying online (sometimes better price but for computers it is mostly the ability to get exactly what I want).
Yes, when you buy sight unseen there is some risk but the better selection and often better prices make it worthwhile.
The other day I wanted to buy a new DVI cable. I looked online to see what Best Buy had in stock at their store. I then looked at Amazon. The cost was about half on Amazon and it would be delivered to my house (I didn't have to drive the 20 minutes each way to Best Buy). The negative was I had to wait 2 days to get the item. I waited the 2 days.
About the only thing that I absolutely feel like I want to buy in an actual store is clothes. I've even wavered some on that particularly where return policies are very easy (the shoes I bought at Zappos that didn't fit well for example).
At the end of the day, though, if I had a choice of buying everything online or going back to nothing online I would choose to buy everything online.
Katsmeow
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
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Just a Best Buy follow up. DH wanted to buy some Ethernet cables the other day. He looked online at Amazon and could get the shortest one for $3 and the longest one he wanted was about $8. These were name brand products. He then looked online at Best Buy and found they had the shortest one for $3.99 so he decided to go into the store so he could get it that day.
Goes to Best Buy and the cheapest short cable was $18! He asked why it was so much since the cheapest online at Best Buy was $3.99. He was informed that was for a different brand and could only be bought online. So, Best Buy basically showroomed itself. He didn't want to pay $18 for the cable (the longer cables were also very high priced) so he went home and order from Amazon. He declared to me that he will never set foot in Best Buy again as it is just a waste of time....
Goes to Best Buy and the cheapest short cable was $18! He asked why it was so much since the cheapest online at Best Buy was $3.99. He was informed that was for a different brand and could only be bought online. So, Best Buy basically showroomed itself. He didn't want to pay $18 for the cable (the longer cables were also very high priced) so he went home and order from Amazon. He declared to me that he will never set foot in Best Buy again as it is just a waste of time....
martyp
Thinks s/he gets paid by the post
No. I don't want to buy everything online. I think more purchasing activity will go online but eventually some kind of equilibrium will occur. It has to because that is how economics will work. But for some of us the world won't be a better place once we get there.
My wife thinks nothing of buying online and then sending it back if she doesn't like something. I hate going through that process but how many people out there will do that?
Well, be careful: Equilibrium could mean simply a number of different online vendors, selling increasingly smaller arrays of products for each category (i.e., vendors compete for market strata based on price, because of consumers settling at their current level of bargain-hunting fixation).
One answer to showrooming would be for brick-and-mortar stores to charge a small membership fee. If you want to come in and try out the keyboard on that laptop or see the real color and fit of those shoes you saw online, you'd need to be a member. That would help assure the people getting the service (the close-up view of the product) pay for that service. And it could allow the stores to decrease prices so customers would be more likely to buy at the B&M store rather than online.
It would be a tough sell--customers will avoid the membership if any store with the goods on display are still non-membership. Maybe Best Buy could get away with it (Circuit City is gone and they stock lots of high-dollar stuff and carry a wide variety--appliance, electronics, etc) and maybe some niche retailers.
It would be a tough sell--customers will avoid the membership if any store with the goods on display are still non-membership. Maybe Best Buy could get away with it (Circuit City is gone and they stock lots of high-dollar stuff and carry a wide variety--appliance, electronics, etc) and maybe some niche retailers.
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