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Retail Chains to Strike Back Against Online Vendor

Hugh Pickens writes (1984118) writes | more than 2 years ago

Businesses 7

Hugh Pickens writes writes "Marissa Taylor writes that the retail chains' worst nightmare are consumers who come in to take a look at merchandise in-store, but use smartphone apps to shop for cheaper prices online. But now stores like low-end retail chain Target plan to fight "showrooming" by scaling up their business models and asking vendors to create Target-exclusive products that can't be found online. “The bottom line is that the more commoditized the product is, the more people are going to look for the cheapest price,” says Morningstar analyst Michael Keara. “If there’s a significant price difference [among retailers] and you’re using it on a regular basis, you’re going to go to Amazon.” Target recently sent an “urgent” letter to vendors, asking them to “create special products that would set it apart from competitors." Target’s letter insisted that it would not “let online-only retailers use our brick-and-mortar stores as a showroom for their products and undercut our prices without making investments, as we do, to proudly display your brands.” Target also announced that it had teamed up with a handful of unique specialty shops that will offer limited edition merchandise on a rotating basis within Target stores in hopes of creating an evolving shopping experience for customers. Target is "exercising leverage over its vendors to achieve the same pricing that smaller, online-only retailers receive," says Weinswig. "This strategy would help Target compete with retailers like Amazon on like-for-like products.""

7 comments

Cut off the 's' (1)

Hugh Pickens writes (1984118) | more than 2 years ago | (#38868913)

Headline should be:

"Retail Chains to Strike Back Against Online Vendors"

It's only 51 characters in the headline.

But it was cut off anyway.

Best regards,

Hugh Pickens

Showrooming is Overblown (1)

Jah-Wren Ryel (80510) | more than 2 years ago | (#38869419)

Who really does this "showrooming?"

I don't. I don't need to see a TV in person - I look at the manufacturer's website, read the reviews and discussions on places like avsforum, trust that I have a good enough eye to detect astro-turfing and then make my decision.

Besides, most of Target's product line isn't even worth buying online - household items and cheap clothing. Nobody's going to squeeze the charmin at Target and then go buy it at amazon.

What they really ought to be worried about are apps that let you scan the barcode and then tell you what nearby stores have the same item for cheaper.

Re:Showrooming is Overblown (1)

tibman (623933) | more than 2 years ago | (#38870237)

I agree with you to a point. But when it comes to clothes and shoes i always try them on first. One brand's medium is a different size than another brand medium. Same for shoes.. a size 10 could have little space for toes and you'd have to go for a 10.5. Of course if you already know a certain brand fits well, then ordering from them online isn't a problem.

Humidifier filters (1)

Spazmania (174582) | more than 2 years ago | (#38869755)

I intend to buy some humidifier filters from Amazon. I bought the humidifier from target. I wanted to buy the filters from Target, but they don't bother restocking the shelf after November.

Target has already been doing this. (1)

Roobles (1880882) | more than 2 years ago | (#38869943)

Target has already been doing this for a while with toys. In particular, the My Little Pony line has quite a few Target exclusives.

Dumb Idea (1)

Jane Q. Public (1010737) | more than 2 years ago | (#38869975)

What they are trying to do, in effect, is to try to skirt marketplace competition by creating brand lock-in.

Gee... where have we seen that before?

It might not be identical to brand lock-in like we have seen from people like Sony, Microsoft, Apple, etc. But it's close enough that it might as well be pretty much the same thing.

And consumers hate it.

If they want to get more customers, they should compete in the market like everyone else. That's the way it's supposed to work.

To the mattresses. (1)

niftymitch (1625721) | more than 2 years ago | (#38871115)

Mattress makers already do this.

This how they can do price guarantee centered marketing.
i.e. it is impossible to find the same mattress for less because
it is "custom" labeled for them.

There are little known ill documented maker codes that let them play
their own comparison games but since most folk only shop once in ten years
any hint or clue about this stuff gets lost....

 

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