[November 14, 2012]

IDC Retail Insights Survey Estimates Showrooming Will Influence Up to $1.7 Billion in 2012 Holiday Retail Sales

IDC Retail Insights today revealed ground-breaking survey results in a new report, Business Strategy: At Hand Versus In Hand - Will Consumers Have the Upper Hand in the 2012 Holiday Showroom Showdown (Doc #GRI237839). Based on a survey of 1,000 online consumers and prior IDC (News - Alert) and IDC Retail Insights research, the new report reveals that some 48 million shoppers - about 20% of the U.S. adult population - will "showroom", or use their smartphones in some manner while they shop in stores, during the upcoming holiday shopping season. This represents a 134% increase from 2011 when 20.5 million shoppers showroomed. IDC Retail Insights forecasts that the number of showrooming shoppers will grow to 78 million by 2015. This year, according to the new research, showrooming behaviors will influence $0.7 to $1.7 billion in holiday retail purchases.

The new report builds on the 2010 IDC Retail Insights survey of consumer adoption of mobile and social shopping (Business Strategy: Mobile and Social Media Commerce in the 2010 Holiday Shopping Season, Doc #GRI226592) and focuses on the dynamics of showrooming to help educate retailers on two key aspects of the trend:

• How, when, why, and how often shoppers use their mobile devices, in particular smartphones, as their on-demand aide-de-camp in stores as they shop.
• The effect of various merchandise, pricing, marketing, customer service, and technology tactics on showroomers' use of mobile devices and ultimately on what they buy, from whom, and where.

In parallel, no survey of retailers has looked at their concerns about showrooming, their understanding of consumers' showrooming behaviors, or the readiness of their plans for this burgeoning trend. The research presented in this new report aims to fill in the gap in understanding showrooming-consumers' behaviors and their impact.

Additional key highlights from the report include the following:

• Big ticket items, in particular those that consumers can easily evaluate by reading descriptions, specifications, ratings, and reviews, will be the most showroomed items this year.
• 7 to 13% of consumer electronics shoppers will use their smartphones at least once in stores this season; showrooming activities will touch 1.4% of consumer electronic sales.
• Apparel and footwear is the second most heavily showroomed category. Between 4 and 8% of shoppers will showroom this category this ear affecting about 1% of sales.
• 64% think what they'll learn in the store with their smartphones will have at least as much influence on their decision as what they'll learn online before coming into the store.
• 56-60% of shoppers with their smartphones in-hand say that they will be "more likely" or "much more likely" to buy what they find in the store as they shop this season when assisted by trustworthy knowledgeable store associates.
• 41% of showrooming shoppers say that they will be "more likely" or "much more likely" to rely on their smartphones when they encounter retailers who offer private or exclusive merchandise.

"The merchandising and customer services strategies that differentiate a retailer and define its value bear on showrooming shoppers' propensity to rely on their smartphones in stores," said Greg Girard, program director, IDC Retail Insights. "Private labels or exclusive brands, customer service, and loyalty stand out as the most promising strategies for dealing with showrooming. Macy's MOM strategy - My Macy's for localization, Omnichannel, and Magic Selling for customer engagement - is an excellent example of how to reach new shoppers and will help the leading retailer successfully combat showrooming this holiday season."

Across a range of omnichannel technologies, approximately 70% of shoppers planning to showroom this season say that they will be at least "more likely" to buy from retailers who:

• Offer full-featured mobile websites.
• Provide omnichannel convenience across stores and websites.
• Support smartphone shopping apps.
• Offer price comparisons via QR codes.

Girard adds, "We see leaders running headlong toward omnichannel customer engagement technology. As Terry Lundgren, Macy's chairman put it at the company's annual shareholders meeting, 'Technology is emerging on every front to help engage our customers and serve their needs… The bottom line is that you can expect Macy's to be a technology leader in helping to improve the shopping experience in-store, online and via mobile.' Denise Incandela, president and chief marketing officer of Saks Direct at Saks Fifth Avenue, has said, 'Brands should make their in-store experiences more mobile-friendly.' Retailers from Wal-Mart to Luxottica Retail acknowledge the critical importance of engaging today's savvy consumer through dynamic technology to improve the customer experience and increase sales."

Introducing the 5I Shopper

As part of the new report, IDC Retail Insights profiles the 5I shopper. These are consumers who by dint of their ever-handy smartphones and tablets are instrumented, interconnected, informed, in-place, and immediate.

This season's showrooming shopper is a consumer that wants to be equally at ease, confident, and assured of value shopping in stores as she is shopping online. Showrooming shoppers expect to be ably assisted by a knowledgeable, trustworthy associate just as much as they expect to self-direct their shopping journeys in stores as an extension of their online relationship with a retailer and vice versa.

"Online inside navigation stands out as the common theme running through the technologies topping the list of strategies most likely to drive conversion-no matter where it begins, meanders, or ends," Girard continued. "For online inside 5I shoppers the distinction between the world of physical stores and their online experience is waning as showrooming waxes."

For additional information about this report, or to arrange a one-on-one briefing with Greg Girard please contact Sarah Murray at 781-378-2674 or sarah@attunecommunications.com. Reports are available to qualified members of the media. For information on purchasing reports, contact insights@idc.com; reporters should email sarah@attunecommunications.com.

About IDC Retail Insights

IDC Retail Insights assists retail businesses and IT leaders, as well as the suppliers who serve them, in making more effective technology decisions by providing accurate, timely, and insightful fact-based research and consulting services. Staffed by senior analysts with decades of industry experience, our global research analyzes and advises on business and technology issues facing the retail industry. International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology market. IDC is a subsidiary of IDG, the world's leading technology, media, research, and events company. For more information, please visit www.idc-ri.com, email info@idc-ri.com, or call 508-935-4490. Visit the IDC Retail Insights Community at http://idc-insights-community.com/retail.

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