Averting Showrooming’s Scrooge Effect

A manufacturer's sales force needs to spend quality time promoting the benefits of their products to retailers to ensure the consumer becomes a satisfied purchaser. The price gauging turns the sales team's attention to why one retailer is getting a lower price than another. Ultimately, manufacturers may be forced to only work with retailers that sell their products for the value the manufacturer attaches to the product.

The money that the manufacturer is forced to spend on compensating retailers, monitoring price issues and dedicating resources to detail with the resulting customer service issues has to come from somewhere. It may result in the loss of jobs as well as reduced marketing and research and development budgets.

The Ghost of Christmas Yet to Come has negative consequences for the showrooming-addicted consumer as well. While the consumer will get short-term gains with reduced prices, the long-term forecast will likely result in fewer choices, less innovation and reduced quality as manufacturers seek to eke out acceptable margins.

As an industry, brands must continue to look for ways to promote products that protect reasonable margins for retailers and manufacturers while still providing value for consumers. As the number of smartphones and comparison shopping tools increase, the impact of showrooming will continue to mushroom and everyone but a select few will lose.

Jeff Mariola is the CEO of DigitalBrandWorks, a digital consultancy which specializes in representing manufacturers in digital marketplaces.