Posted by Jeff Kirby on June 24, 2015
In the infancy of online shopping, it became clear to manufacturers that consumers widely relied on the Internet to research purchases before buying them in brick-and-mortar stores. In 2007 Internet Retailer reported, “Online consumers told surveyors that they spend more time researching products online than they spend shopping in person. Two-thirds of multichannel shoppers said the Internet is the most important shopping information resource.”
Dubbed ROPO (research online, purchase offline), this customer behavior was essential in driving manufacturers to improve their web content to increase both physical and online sales. There were a number of reasons consumers preferred to buy items in physical stores a decade ago even though they were available for purchase online.
Buying online was still a relatively new experience; people were used to going to big-box chains for major purchases, and appreciated the tried-and-true comfort of physically handing money to a human being for goods and services. Some people simply didn’t trust the Internet.
As consumers became more comfortable purchasing online, sales in physical stores began to decrease. As Circuit Citys and K-Marts across the country closed their doors, some wondered if researching online and purchasing offline would become a fad of the past. The physical retail landscape is still changing in ways we can’t fully predict, and ROPO as we knew it has changed. But it hasn’t died out; it’s evolved.
The online marketplace is continuously adapting to cater to the desires of demanding consumers. As consumer data is now collected and analyzed in increasingly effective ways, and technology improves to push conversions to peak efficiency, it’s become clear that ROPO is actually a two-way street. Consumers still research online and purchase offline, but they also research offline and purchase online.
Perhaps since two definitions of ROPO shared the same acronym, new terms were created to differentiate the two. Webrooming refers to the practice of researching an item online before going to a physical store to purchase it. Showrooming is its opposite, where consumers check out products in a physical store first before going online and looking for the best price.
While originally thought to be a threat to in-store sales, showrooming is in fact a more nuanced activity. A recent study looked at different motivations of mobile-assisted shoppers and found that fewer than half were motivated by seeking a lower price.
Though digital sales continue to increase, brick-and-mortars are by no means becoming obsolete. Even companies that sell online exclusively are starting to open physical retail locations because there is no virtual comparison to trying on a shirt to make sure it fits right, or smelling a fragrance before you decide to coat yourself in it.
Birchbox.com is an online service with over 800,000 members. Though conceived as an online-only delivery service, they opened a physical store in New York City 2014. Birchbox cofounder and co-CEO Katia Beauchamp thinks that she might not have originally received funding for her company if the initial rollout included retail stores. “Back in 2010, holding inventory in a store wasn’t cool,” she recently told Entrepreneur. “But now investors see how the store can add legitimacy to an established online brand.”
As Beauchamp explained to NY Magazine, “The reality is that 95 percent of all beauty products sold are still purchased offline. That means we send a lot of our customers offline, to shop.” In the case of Birchbox, opening a retail shop makes sense: If their customers are already researching on their site to buy later in a store, Birchbox might as well own the store.
Warby Parker and Athleta, both originally conceived as online-only businesses, have also opened physical shops in the past few years. And they aren’t alone. Many other formerly digital pure-play companies are opening physical locations, whether with pop-up shops, space in large retail chains such as Nordstrom, or dedicated storefronts.
What businesses need to do to accommodate and capitalize on all types of shoppers is now an essential part of omnichannel marketing. Whether a prospective buyer is webrooming or showrooming, businesses need to be equipped for them to begin an interaction on one channel and be able to finish it effortlessly on another.
Figuring out how to seamlessly facilitate the consumer experience across all devices and channels benefits from collecting and analyzing many sources of data. Though some may currently see omnichannel as an aspirational content strategy, there are a number of companies who claim they can gather the data to get you there.
Brand View “gathers pricing online, integrates field-collected data from bricks and mortar stores, and combines this information with our client’s own data feeds to present them with one holistic view of the market.”
Certona offers the ability to “automate merchandising and marketing for revenue optimization, use personalization to collect and act upon consumer behavioral data in real-time, and integrate a seamless individualized experience throughout your customer touch points.”
According to Genesys, the current standard of omnichannel customer engagement is lacking. Genesys sells customer experience techonology as well as call center technology in a quest to “manage the lifecycle of the customer journey (design, orchestrate, monitor, tune) to provide a personalized and context appropriate experience for each and every customer (journey management).”
Finding any sort of definitive ROI for this myriad of nuanced services is currently privileged information, but improving customer experiences across channels does appear to be a proven way to increase conversion. Even if a company isn’t quite reaching the omnichannel ideal right now, simply improving the online shopping experience for customers has shown to increase sales offline.
As 0f 2014, digital commerce influences 49% of in-store sales, according to a Deloitte study. This number is predicted to jump to 64% in 2015.
“Identifying concrete ROPO numbers is challenging because it can be difficult to create a direct link between digital content creation and in-store sales,” said content26 CEO Tony Martinelli.
“However, many of our clients, especially in CPG, who substantially invest in enhanced online content for their products and brands have seen a positive impact on in-store sales for these same products and brands. This trend suggests that a strong online content strategy can have a noticeable impact on in-store sales and that consumers are gathering product knowledge from online sources, even if they are ultimately purchasing the product in a traditional brick-and-mortar store. Many of our clients see a market share increase online that is aligned with their digital strategy. What’s interesting is that some of them also see a complementary increase offline, even when they are not making significant changes to their traditional in-store traffic drivers.”
Customer satisfaction with online content influences the way they purchase later in stores, and vice versa. Even if all of a customer’s electronic devices, your website, and your store aren’t yet connected by a hive mind, it is imperative consumers be able to get the information they need, online and off, to make an informed buying decision.
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