NZ 'showroomer' shoppers look in stores then buy online

A new trend is emerging as tech-savvy Kiwis change their shopping habits. 

About 15 in every 100 adult New Zealand shoppers with internet access are looking at items in stores – then buying online.

And nearly seven in 100 are buying online from a different retailer than the one who showed them or let them try on items.

A new HorizonPoll survey of 2425 New Zealanders nationwide finds that 14.6% of adults are indulging in what is known overseas as “showrooming”. 

That equates to about 425,000 adult shoppers.

After visiting a store: 

  • 5.6% of adults with internet access bought online from the same retailer in New Zealand (about 159,000 people).
  • 5.9% bought online from a different retailer in New Zealand (about 168,000 people).
  • 3.1% bought from a different retailer overseas (88,000 people).

Overall, the survey finds 74.5% of adults with access to the internet are buying retail goods online in New Zealand and 41.1% overseas. Only 20.2% of adults with access do not buy retail goods online.

Horizon Research manager Grant McInman says the survey finds overall that more than 2.1 million adults in New Zealand with internet access are retail shopping online from local retailers.

In comments to Horizon, those shopping offshore say that they have little sympathy for local retailers who do not compete on price.

Some retailers have reportedly considered charging a fee for trying on clothes in store.

Horizon says this might concern the 5.6% of adults who are viewing or trying items – then buying from the same retailer online later.

 

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41 Comments & Questions

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Yep, I do it. Not sure how they combat this. Maybe just have a physical store to look at stuff then order online from there?

Have display stores but no large retail, etc.

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Who "pays" for the physical store? There's your problem.

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Not really a problem. Take the Home Ideas Centre in Parnell, Auckland. You can't buy anything there but you can certainly look and get advice. In other words, the manufacturers or distributors themselves can pay to have a presence like at most trade shows.

No doubt some entrepreneur is going to do this and make a killing. "Westfield Browse", maybe?

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This means retailers have an opportunity to "close the sale" in-store with 425,000 customers. That's a significant opportunity. Why let them try and flee?

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You try and close a sale when they know they can get it significantly cheaper elsewhere.

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If the retailers actually put more effort into their on-line stores including better sizing information, photos/images of the items, etc, AND were price competitive, then people would probably spend more with them online.

I buy most of my clothes offshore and have never visited, but they are so much cheaper and so fast at delivery I can afford to get a few items wrong and either give them to (generally smaller :)) family members.

It's not rocket science as to why places like Chainreactioncycles and Wiggle have done so well. Price, service, selection. Kind of like retail...

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In general, I find interacting with "sales" people in store a very repulsive experience. Not only they don't add value, but significantly subtract value. Why bother putting them there?

You go into the store to see the physical stuff and play with it. If the store provides good customer interaction experiences and charge reasonable prices then people will buy it there, rather than order online.

The repulsiveness of interacting with the in-store "sales process" and unfair mark-up drive people to shop online. Why else would people put up with the delay and uncertainty of product/merchant quality when shopping online?

Retailers, look at your own staff, sale process and mark-up. You have all the benefits of face-to-face undivided attention of potential customers, but you blew it.

Another aspect is NZ consumers are getting sick of being fleeced in every aspects - from supermarkets, power, all form of services, housing, right through to council rates.

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You may find salespeople repulsive but spare a thought for the salespeople themselves who interact daily with vomit-inducing, scumbag shoppers who can't even string a few words together to describe what they want and who take an eternity, fumbling through their purses and wallets that are stuffed with what looks to be the contents of their rubbish bin.

They're looking for their loyalty card, even though they aren't sure if they ever had one (they probably left it in the same place they left their manners) and all the while they recite the look-with-your-eyes-not-your-hands chant as their little darlings pick over (damage) the merchandise like a swarm of locusts.

Then they complain because the purchase they have finally settled on has some grubby little fingermarks on it.
And finally when they are shown the eftpos machine they feel put out because they have to actually swipe their filthy disease-ridden bit of plastic themselves, so they feel the need to complain about how lazy sale-people are these days.
Have you ever had that nauseating in-store experience?

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Did this at the weekend. Tried on shoes in Newmarket, jumped online and landed them for $110 cheaper! $230 in Newmarket, $120 online from the UK. No brainer.

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And then, next week, that shoe store will be out of business, their employees will be on the dole and you will be bitching "why doesn't the gummit do something?"

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I have bought a few things online from an overseas retailer. Generally, the items are not available in New Zealand. The delivery was faster than organising a transfer within Auckland retail stores!

I regularly go to a retailer with the intention to shop, but find most sales staff very disinterested in helping me.

Maybe if retail staff were more motivated there would be more sales in store. But then again, I am not in my mid-20s and not very hip looking! So I guess they think they cannot help me.

I don't even venture into some retail stores because of the rolling of eyes I have received from young girls twirling their hair and chewing gum... Yet, on average, when I get some assistance I drop serious dollars.

So I am all for the non-judgmental online purchases!

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Poor staff is the fault of the stores themselves. Pay peanuts and you get monkeys. A good salesperson will more than pay for themselves.

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I refuse to spend money in a store where staff don't deign to serve me. You know the ones, where they talk among themselves or focus avidly on anything other than activity likely to produce a sale.

On the other hand, I return to stores, and recommend them to my friends, when I've had a good experience, and we have pretty deep pockets.

I know the pay rates in retail are low, but whatever happened to the satisfaction gained from doing your job well, to the best of your ability?

My message retail store staff: those mature women may not look hip but they have money to spend so don't judge a book by its cover. At the very least make eye contact and greet us warmly. Maybe we'll open our wallets.

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A new trend? Hardly, even for New Zealand which is - objectively - about 3-5 years behind the curve on these sorts of things.

Reality is that retail is undergoing a fundamental shift, and things will never be the same again. Those that survive will be the ones who figure out how to integrate their online and offline outlets, or shift entirely online to very targeted niches. There are plenty of case studies in the UK and US where a "multichannel" approach to retailing is paying dividends.

NZ retailers should be reading up on innovations overseas, and figuring out how to implement them here and now, rather than wringing their hands and waiting for the government to protect them from overseas competition by being more active in charging duty on personal imports from overseas retailers.

They should also know when they're beaten. For example, I'm unlikely to buy a book from a NZ retailer ever again, given the prices I can get the same products for overseas.

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It's not the internet that has driven us from the High Street, as much as the obnoxious, council-supported, ie, shopkeeper-instituted, parking wardens. We will shop anywhere with ample free parking.

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Having had some excellent in store retail experiences in my travels to UK, US and EU it pains me to shop here in NZ at some stores. I might not look like a high-roller, but I certainly have plenty of disposable income.

Being ignored makes me not want to spend. Employment in retail in NZ is not viewed as a career, but merely a job in most cases, leading to disinterested staff with no knowledge about what they are selling and little enthusiasm.

Great experiences at non-NZ retailers has led me to now shop online with companies I have had good interactions with in person while overseas.

I will continue to strive to get the best quality product I can for my money, from whomever offers me the best service.

Long live online retail!

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Good for you, Craig. The customer is the boss. Now watch the politicians bend to the retailers' pressure and add an absurd tax on private imports that will cost more to administer than what it collects.

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"Some retailers have reportedly considered charging a fee for trying on clothes in store."

Good luck with that.

I can envisage a not-so-distant future in which you send online clothes retailers a few photos (or by some other technology) and they work out a 3D digital model on which you can try on clothes/shoes virtually.

This would all but eliminate the need to go into a conventional store.

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Its called 40+ day free returns. Asos and most other good online clothing retailers provide this.

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Yes, but I still think there is a mental barrier which makes people wary of ordering online at present without trying for fit or suitability. How many times have you seen something which looks good on the hanger but doesn't fit properly when you have gone to try it on? You could order online and send it back if it doesn't fit but as evidenced by this article people still like to have some evidence before purchasing, where possible. I'm saying that once online retailers crack a good virtual changing room then the physical retailers will be all but gone as they currently are.

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In my opinion the only retailer who has got it right is Michael Hill Jewellers. Their customer service is fantastic and makes you feel like you want to buy something right then and there.
Their customer service training is a career and the training and backup they receive must be awesome (the customer service people also aren't all young and uninterested).
P.S. I'm a guy, and I don't like shopping but MH make it easy.

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I usually check prices online, and if the shop will match them, I happily buy in-store. If they are unrealistic on in-store pricing, then I do buy online instead.

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Does this survey distinguish those who tried on in the shop, then bought at that shop's online store? If there is a queue or the shop doesn't have the correct colour, but you have confirmed the size, buying from their online shop (as mentioned by another commenter) is quicker than waiting for the shop to get the right product in from another branch, and having to make another trek to the shop, finding parking....
It doesn't mean that retailer has actually missed out on the sale.

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In Los Angeles a number of Westfields now have a booth you can enter to generate a 3D rendering of your body to get precise measurements, etc, but not far off using the data generated to virtually apply clothing or shoes before purchasing online.

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Speaking of shoes being sold in Newmarket. Shoe Clinic were selling Brooks Glycerine 9 for $299. The same item can be bought off Amazon.com and delivered to a US address for an all-up cost of $US100.

Same ridiculous price differentials apply to Weber BBQs. The Weber One-Touch Gold sells for $499 in NZ and the same item (delivered) costs the Americans $US149 (or $NZ183).
And NZ retailers are bemoaning why they are losing trade to their off-shore counterparts?!

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How about the freight?
Small Kiwi customer base.
More cost per unit to freight from overseas manufacturer.
Part of life when we choose to live in this wonderful country.
C'est la vie.

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Greetings, an interesting topic.

Lots of posts about poor service from young staff in stores, which not doubt has some truth. However, I'd like to add that most of the poor service I have received in-store has come from owners and managers, so it's not surprising their staff don't come up to scratch.

The most recent example was when I went to an inner city (Auckland) bike shop, as I could see through the window they had a specific bike I'm interested in buying. When I walked in the door the owner barked at me the store was closed and I could come back tomorrow. And I do mean barked!

So that $4000 sale is now gone, and I'll not be venturing to that store again ... ever.

Despite my many attempts, finding good customer service in stores is a struggle, but when it comes to online retailers in NZ I think I've only had one bad experience. Maybe that's why all our high streets are becoming filled with cafes, fast-food brands, banks and estate agents.

I think there needs to be a dramatic shift in the ownership and management of independent retailers. They need to focus on making sales to any and all customers who have the money to spend and get them while they are in the shop.

Thoughts?

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The shift in the nature of the 'High Street' is interesting. I would suggest a previous shift was in the rise of supermarkets which have almost obliterated food shops (butchers/grocers/bakers, etc) from the 'High Street'. I think what we are seeing now is a similar shift happening to clothing/shoes/electronics/books due to the internet.

Times change and I think these shops are fighting a losing battle to stay on the 'High Street' as they are. Businesses will replace them but their nature will probably be more service-based (cafes, restaurants, leisure) rather than retail (although some impulse shopping outlets will probably survive). I don't think a changing "High Street' is necessarily a bad thing, as long as they evolve into places people want to spend time in.

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Shoes are my beef. I have bought Rockports in San Francisco for $US50. Here they cost $NZ275. I bought Riekers in Russia for the equivalent of $NZ70 (full price) and they are $245 here. Yes, I know it costs a lot to get to these places but I was going there anyway.

Why is the mark-up on these imported shoes so much?
And did you read the article in today's Herald on Oyster Bay prices here vs the US?

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I fed up going into a New Zealand conventional store to buy any electronical applicance and technology gadgets because nearly 98% staff working in-store have no expertise in product knowledge.

Adding to that, they are neither passionate about their job nor satisfying a customer's need. I feel much happier shopping online as we are given sufficient product knowledge and hence a stress-free shopping process.

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Online shopping is fantastic when you live in a small town. However, I also support the local retailers whenever possible - otherwise they won't survive and be there when we need them.

In a big city it is simple to be entirely selfish and self-centred but in a small place you must respect your inter-dependence.

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I agree with many comments above about customer service. But there is one chain that has it right -- Bunnings has fantastic service with very helpful staff . They have this by good staff training and/or by employing ex tradespeople ( ie older staff). I will drive past their competitors for this.

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It's just a pity they pay such low wages to their staff...

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Lingerie is hideously expensive here in NZ. I just purchased a G-string panty from Victoria's Secret (their flagship store on Rodeo Drive). And shipping charges were "cheap a chips", cos it came in a thimble-sized cannister.

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This is consistent with research that we undertook in 2011 in America which also shows the opportunity - http://www.aimia.com/files/doc_downloads/Aimia_Showrooming.pdf

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Retail stores have to find some portion of the sales process that the online stores can't deliver. Perhaps entertainment, food, drinks, etc, in store while you peruse and buy.

One complication that is likely to impact purchases is a tax or duty on the way into NZ. It is not just the retailer who is missing out on revenue, it is the IRD. What happens when goods (single item) under $50 are the only exception to GST. You can see the charges in duty-free purchases already, when buying goods in Aus, you can get the GST refunded on leaving so long as the purchase invoice for one shop is >$A400. This is the opposite situation to import via online purchase, as the Aus tax dept try to hang on to all taxes paid in Aus. Likewise, they will try to gather taxes on all purchases made outside the country.

When your $200 jeans are stopped and held at the border until you pay GST the extra paid at the store might not seem so bad. Don't shoot the messenger as I also buy online. In fact, did so with a very exotic car and saved a fortune.

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So, you went ahead and bought that 2002 Saab convertible, Chris?

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Not quite correct, #23. GST is not collected if the amount is less than $60. This means Customs won't bother you if your purchase is less than $400.

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Personally, I think this is morally reprehensible. When all the shops, or several anyway, have closed because of such behaviour where will we all be then? No shops to check stuff out first. Problems for people without access to internet. YES! And, of course, a lot more unemployed people. No, I do not work in a shop but would never do this because it is socially irresponsible. Are there more of you out there or am I alone and wasting my time worrying about the future?

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Not only are items cheaper online but also come with better terms. If you change your mind you can return for a cash refund.
Very uncommon in NZ.

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Bought online from NZ retailer advertising Boxing Day sale "beat the crowds". Now they say I just get my money back since they will not be supplying the goods. So much for beating anything. Would have been better off in the crush and at least I would have had the goods at the right price for the last 2 1/2 weeks. Not talking about a $50 item, either. My trust is higher for overseas retailers than NZ online ones.

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