1

Showrooming: Empowering

Consumer Electronics Shoppers

February 20, 2013

2

Contents

Introduction and Topline Summary 3 Research Results 6 Appendix 21

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Introduction and Topline Summary

4

• This Showrooming: Empowering Consumer Electronics Shoppers

Study focuses on consumer electronics and explores the influence of

mobile devices on the shopping process, general shopping behaviors

in physical stores/online and “showrooming”.

• Ipsos fielded the online survey with 482 consumer electronics

shoppers (past 6 months) in February with its HearWatchSay (HWS)

community. Quantitative results were supplemented with qualitative

input about shopping and showrooming behaviors.

• HWS is an online community whose members are media forward

enthusiasts of movies, TV, technology, gaming.

• Respondents are Adults 18-64 in the US.

Introduction

5

Topline Summary

• 86% of consumer electronics shoppers surveyed did their shopping online, while 74% shopped in a physical store.

• Nearly one third (31%) of consumers used their mobile device for shopping related activities while in a store. • Among in-store shoppers, over a quarter of consumers intended to showroom by trying out the products in

the store and then buying online. However, more than half of in-store consumer electronics shoppers intended to buy the product in the store.

• In line with showrooming expected behaviors, close to three-quarters of consumers who went to a store went there to try out a product..

• Over 3 in 4 consumers did some form of online research prior to going to a store, while 6 in 10 did so after visiting a store.

• Shoppers who used their mobile device while in the store were more likely to do online research after their store visit.

• Whether doing research before, during or after going to the store, the most popular research types done were: checking prices, reading reviews and looking up product features.

• Over 4 in 10 consumers who ultimately made an online purchase used their mobile device in store for showrooming/shopping related activities.

• Price is the top driver of consumer electronics purchases online. Convenience and the ability to try/see the products are the top reasons for purchases in the store.

• Biggest spenders did in-store research on a mobile device. • In-store mobile users were much more likely to make unplanned purchases while shopping: 1 in 3 bought

something spontaneously in the store, 1 in 4 bought something spontaneously online. • On average, mobile device owners and those that use their mobile device while shopping spend more on

consumer electronics. (However, this could be due to increased frequency of purchases and not increased spending per occasion).

• Over a third of shoppers recall seeing ads for consumer electronics they were shopping for. Among these shoppers over 7 in 10 report seeing digital ads.

Key Insights

6

Research Results

Where Did You Shop for Consumer Electronics?

Q1a. Did you shop ONLINE for the following products? Q1b. Did you go to a physical STORE to shop for any of these products?

86%

14%

Did You Shop Online?

YesNo

74%

26%

Did You Shop In A Store?

YesNo

• 86% of Consumers Shopped Online • 3 Out of 4 Shopped in a Physical Store

More Than Half of In-store Consumer Electronics Shoppers Intended to Buy the Product in the Store

Q1c. Did you intend to buy the product when you went into the store?

25% 27% 23%

58%

In Store Intentions

No, I intended to try out the product, but wasn’t ready to buy it yet

No, I intended to try out the product at thestore and then buy it online

Yes, I intended to buy the product at thestore, but after trying it out I hadquestions/needed more time

Yes, I intended to buy the product at the store

“I always first go to the store to look at a product and

then buy it online (especially off of Amazon).”

• Over a Quarter Intended to Showroom, by Trying Out the Product in the Store and then Buying Online

Three-Quarters of In-Store Shoppers Went There to Try Out the Product

Q2. Thinking about the products you recently shopped for, please tell us why you went to a physical store. Please select all that apply.

74%

46%

43%

29%

27%

23%

22%

9%

Try It/See It

Convenience

Price

Selection/Availability

Service

Shop Experience

Saw anAd/Promotion/Sale…

Preference/Habit

Why Did You Go To The Store? “Even though I may buy the product online I do

like to go to the physical store so I can actually see

it and perhaps try it”

“It's great to check out phones (new iPhones, iPads and other

tablets, TVs) and really get to feel and touch and try them in a store”

“I go to the store for service. If the employees are friendly and knowledgeable and try to help me find the perfect item for me

I'll most likely buy it from them.”

“If I have a coupon that I can only use in store and it beats an online price then I will go there

for sure to do that.”

• Nearly Half Visited the Store for Convenience or Price • Service Was Not a Key Driver of In-Store Shopping

Over 3 In 4 Consumers Did Some Form Of Online Research Prior To Going To A Store

Q3. Still thinking about the products you shopped for in a store, did you do online research BEFORE you entered the store? Q4. What type of online research did you do BEFORE visiting the store(s)? Please select all that apply.

22%

73%

21%

Total

Did You Do Online Research?

Yes, onmobile device

Yes, oncomputer

No

Yes (Net) 78%

80%

79%

76%

59%

33%

16%

15%

14%

6%

Checked prices of theproduct(s) at online retailers

Read reviews of theproduct(s)

Looked up product features

Checked prices of theproduct(s) at physical stores

Checked in-storeavailability/stock

Asked friends for adviceonline (social networks,…

Checked warranties

Checked store hours

Looked up directions to thestore

Type of Research Before “Any and all price/product

research is done on my computer before I even

set foot outside the door!”

“I am a big comparison shopper and will

always check prices and reviews on higher

ticket items before going to a store.”

• Top Research is Checking Prices, Reading Reviews And Looking Up Product Features

Nearly One Third Of Consumers Used Their Mobile Device For Shopping Related Activities While In A Store

Q5. Did you use your mobile device for any shopping-related activities WHILE IN THE STORE(s)?

26%

6%

3%

3%

69%

Yes, Smartphone

Yes, Tablet

Yes, Feature phone(regular cellphone)

Yes, Internet-Enabled Device

(iPod Nano, iPod…

No, did not usedevice

Type of Device Used

31% 69%

Used Mobile Device For Shopping Related Activities

Yes

No

“Using a smartphone has made it much

easier to check out deals online while I'm shopping in a store.”

“I have not used my smartphone as yet in the shopping process

but do intend to in the future.”

“When shopping, I'll use my phone

to compare prices at stores.”

• Smartphones Were The Most Common Device Used

In-Store Mobile Usage:

Q6. How did you use your mobile device WHILE SHOPPING IN THE STORE(S) for consumer electronics? Please select all that apply. Q7. How does using your mobile device while at a store impact your shopping experience? Q8. Did you plan to use your mobile device as part of your shopping process?

60%

46%

35%

34%

30%

27%

19%

14%

14%

10%

Checked Price

Reviews

Scanned Bar Code

More Info

Coupons and Discount Codes

Checked Availability

Photo

Store Locator

Check-In

Advice

How Mobile Device is Used While In Store

“I mainly use my phone to look up prices and

reviews while I'm shopping. I've found the Amazon PriceCheck app

to be particularly helpful, because you can just

scan the barcode and it finds the product (and

other comparable products) for you.”

• Most Checked Prices While in the Store • About Half Read Reviews • About One Third Scanned Bar Codes and Sought More Info

Two-Thirds of Shoppers Who Use Their Mobile Device in the Store Say it Makes Them More Likely to Buy the Product

Q6. How did you use your mobile device WHILE SHOPPING IN THE STORE(S) for consumer electronics? Please select all that apply. Q7. How does using your mobile device while at a store impact your shopping experience? Q8. Did you plan to use your mobile device as part of your shopping process?

65%

5%

30%

Makes me more likely to buy theproduct

Makes me less likely to buy theproduct

Does not impact my purchasedecision

Impact on shopping experience

31% 69%

Used Mobile Device For Shopping Related Activities

Yes

In-Store Mobile Device Users Were More Likely to Do Online Research AFTER Their Store Visit

Q9. Did you do any online research AFTER visiting the store(s)?

18%

53%

62%

45%

42% 3%

Used Mobile Device IN STORE for ShoppingRelated Activities

Did NOT Use Mobile Device IN STORE forShopping Related Activities

Online Research AFTER Store Visit

Yes, on mobiledevice

Yes, oncomputer

No

Nearly 6 In 10 Shoppers Did Online Research After Visiting a Store

42%

50%

15%

Total

Online Research AFTER Store Visit

Yes, on mobiledevice

Yes, oncomputer

No

Yes (Net) 58%

73%

59%

53%

40%

21%

13%

12%

10%

4%

Checked prices of theproduct(s) at online retailers

Read reviews of theproduct(s)

Looked up product features

Checked prices of theproduct(s) at physical stores

Checked in-storeavailability/stock

Asked friends for adviceonline (social networks,…

Checked warranties

Checked other store hours

Looked up directions toother stores

Type of Research After

Q9. Did you do any online research AFTER visiting the store(s)? Q10. What type of online research did you do AFTER visiting the store(s)? Please select all that apply.

“My husband will go look at products at a store and then

shop on line to compare prices and

look for a better deal.”

• Checking Prices and Reading Reviews are the Most Common Post-Store Visit Activities

• Research Activities are Similar Whether Before, During or After Shopping

About 6 in 10 Consumer Electronics Shoppers Ultimately Made a Purchase

Q11. Where did you end up purchasing your consumer electronics product(s)?

41%

55%

54%

Total

Where Purchased?

In a PhysicalStore

Online

Did NotPurchase

Purchased (Net) 59%

• Shoppers Were Evenly Split Between Purchasing Online or In-Store

Those Who Used Their Mobile Device in the Store Were More Likely to Make a Purchase

Q11. Where did you end up purchasing your consumer electronics product(s)?

““While I was shopping in Walmart … I saw a better prices for it online. I

went home and brought it for a cheaper price online and had it

shipped free to Walmart!”

• In-Store Mobile Users Were More Likely to Buy Online • However, Nearly One-Third Did Make a Purchase In-Store

59% 71%

41% 29%

Consumer ElectronicsShoppers

Those Who Used aMobile Device In-

Store

Didn't PurchasePurchased Product

30% 42% 29%

In A Physical Store Online Did Not Purchase

Used Mobile Device IN STORE for Shopping Related Activities

4 in 10 Showroomed

Top Reasons for Shopping Online vs. In Store

Q11. Where did you end up purchasing your consumer electronics product(s)? Q14. Why did you purchase the following Consumer Electronics ONLINE vs. in a STORE? Q15. Why did you purchase the following Consumer Electronics in a STORE vs. ONLINE

74%

53%

39%

31%

24%

11%

7%

Price

Convenience

Selection/Availability

Research/Info

Saw anAd/Promotion/Sale…

Preference/Habit

Spontaneous

Why Purchase Online

51%

44%

44%

29%

25%

24%

17%

16%

10%

4%

Convenience

Try It/See It

Price

Selection/Availability

Saw an…

Service

Trust

Shop Experience

Preference/Habit

Spontaneous

Why Purchase In Store

55% 54%

Purchased Online Purchased In Store

• Price Is the Top Driver of Online Purchases • Convenience and the Ability to Try/See the Products are the

Top Reasons for In Store Purchases

Top Reasons For Shoppers Not Making A Purchase: Cost, Just Looking, Not Being Ready

Q12. Why didn’t you end up buying the product(s)?

Biggest Spenders Did In-store Research on a Mobile Device

$891

$1,539

$929

Total Used Mobile DeviceWhile Shopping

Did NOT Use MobileDevice While Shopping

Average Amount Spent

Over A Third Of Shoppers Recall Seeing Ads For Consumer Electronics They Were Shopping For

Q17. Do you recall seeing any ads for Consumer Electronics around the time that you were shopping for the product(s)? Q18. Where did you see these advertisements for Consumer Electronics? Q19. Did seeing the following digital ad(s) influence your decision to visit a store or online retailer?

50%

36%

14%

14%

8%

7%

64%

54%

35%

10%

Online Ad

Email from retailer

Groupon type site

Social Media

Online coupons

Mobile App

TV

Print Ads

Direct Mail

Billboard/other signage

Why Purchase In Store

Digital (Net) 71%

35% of people recalled seeing ads

28%

50%

38%

Digital Ad Influence

Yes, made me visit a physical storeYes, made me visit an online storeNo, did not influence either way

• Among These Shoppers Over 7 In 10 Report Seeing Digital Ads

In-Store Mobile Users Were Much More Likely to Make Unplanned Purchases While Shopping

Q13. While you were shopping for your product, did you end up buying any other Consumer Electronics products

56%

90%

22%

3%

32%

7%

Used Mobile DeviceWhile Shopping

Did NOT Use MobileDevice While

Shopping

Made Unplanned Purchases

Yes, while shopping in a store

Yes, while shopping online

No, I did not buy any extra Consumer Electronics products that I hadn’t planned to buy

• 1 in 3 Bought Something Spontaneously in the Store • 1 in 4 Bought Something Spontaneously Online

On Average, Mobile Device Owners And In-Store Mobile Device Users Spend More On Consumer Electronics

Q16. How much have you spent on Consumer Electronics over the past 6 months?

8% 4%

21%

1% 6%

10% 8%

20%

7% 12%

11% 10%

14%

5%

12%

21% 23%

15%

16%

22%

25% 27%

19%

28%

26%

24% 28%

12%

42%

21%

Total Mobile Non Mobile Used MobileDevice While

Shopping

Did NOT UseMobile Device

While Shopping

Amount Spent

$1000 or more

$500 to $999

$250 to $499

$100 to $249

$891 $1,010 $533 $1,539 $929 Mean

Spent =

More Consumers Engage In Pre-Shopping Research

80%

79%

76%

59%

33%

16%

15%

14%

6%

60%

46%

27%

10%

35%

34%

30%

14%

73%

59%

53%

40%

21%

13%

12%

10%

4%

Checked prices at online retailers

Read reviews

Looked up product features

Checked prices at physical stores

Checked in-store availability/stock

Asked for advice online (social networks, email)

Checked warranties

Checked store hours

Directions to the store

Scanned Bar Code

More Info

Coupons and Discount Codes

Check in

Type of Research Done

Before Store Visit During Store Visit After Store Visit

18%

53%

62%

45%

42%

3%

Used MobileDevice While

Shopping

Did NOT UseMobile DeviceIN STORE for

ShoppingRelated…

Online Research AFTER Store Visit

Yes, on mobiledeviceYes, on computer

No

• Most Lucrative Buyers Do In-store Research • Most Mobile In-store Shoppers Do Post-Store Research

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Appendix

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Top Comments

• “I showroom every single electronic item that I buy. I want to be able to try it out before buying but I also want the lowest price when purchasing so I end up finding a lower price online every time. I have never found a price at a store that I couldn't beat online. Why would anyone pay a higher price to buy an item in a store?”

• “I think the bar for "showrooming" has really been set by Apple. Of course you can actually buy Apple products in the store but the prices are crazy and for lots of other reasons it is less about taking the sale on the spot and more about planting the seed (and offering amazing after sales support). The experience of playing around with a product, uninhibited with the fun atmosphere and friendly help of the Apple store is what sold me on the actual product. Showrooming is especially important for mobile devices, if something is going to be attached to my hip and used every day of my life I have to know how it looks, feels, carries (will it fit in my pocket?) and the user interface.”

• “I'm definitely a window shopper and technology has only increased this tendency. I enjoy just going and walking around stores on my lunch break or even some evenings or weekends because it's relaxing, but I'm never one to take a deal at face value - and using a smartphone has made it much easier to check out deals online while I'm shopping in store. It doesn't really matter what type of product it is - I do this for everything from toilet paper to electronics, although I'm much more likely to spend more time researching bigger ticket items. I mainly look up prices, but I also look at reviews while I'm shopping too. I've found the Amazon PriceCheck app to be particularly helpful, because you can just scan the barcode and it finds the product (and other comparable products) for you. I think I'm about 50-50 on whether it makes me more likely to buy items in store or not - there have been times in the past before my smartphone days that I've walked away from deals to research them later and regretted not getting them when I discovered it really was a good deal. Now, having the technology at my fingertips, if I find out it's a great deal on the spot, I'm more likely to buy it then. However, there are also many times when I look it up online while I'm shopping, find out I can get it cheaper elsewhere, and walk away - unless the convenience of having it immediately outweighs the better deal. All that being said, if I'm pressed for time, I'm much less likely to showroom and more likely just to trust my instincts on whether it's a good deal or not (and take the chance of having to possibly return it later). One thing about the in-store experience that would make me wait to buy a product online is the length of the checkout line. If I can get as good a deal or better online (or maybe even a little more) and don't need the product right away, and it's the only thing I'm buying in the store that day, I might avoid the long line and opt for the ease of having it delivered in a couple days. Plus, there's always the possibility of finding a coupon code online or getting points through a rewards site to get an even better deal”

• “I do my research online before making any major purchases. It narrows my list to just a few makes and models. I will then go to see these at a local store to make my final evaluation. Where I make the purchase depends on where I find the best balance of value and service. While I carry my smartphone with me, I rarely use it in a store. I did my research already and I know what the going prices are before I leave home. In a great many instances, these stores wind up being nothing more than an Amazon showroom. The stores are rarely price competitive and almost none of them service anything they sell on site. In-store service was the last unique feature stores had, but now even they mostly ship any items needing repair to some distant place. Customer service has gone, too. Often the in-store staff know less about the products than I do. Cornering an employee is often impossible ( there are too few of them) and the result unsatisfying anyway.”

Key Verbatims

Smartphones, flat screen TVs, tablets and laptops are the most popular consumer electronics shopped for in the last 6 months

Q1. Have you shopped for any of the following products in the last 6 months? You do not need to have purchased these products but simply have shopped for them. Please select up to 3 products that you most recently shopped for.

40%

33%

31%

31%

17%

15%

14%

12%

7%

7%

5%

4%

4%

8%

Smartphone

Flat screen TV

Tablet

Laptop or Computer

Headphones

Digital Camera

DVD/Blu-Ray player

Gaming console

MP3 player

Speakers

GPS device

Home entertainment system

iPod Dock

Other Consumer Electronics

Shopped For In Past Month

Q0. Which of the following do you own? .

81%

74%

67%

49%

33%

26%

Laptop

Desktop Computer

Smartphone (iPhone, Android,Blackberry, Windows Phone, etc.)

Tablet (iPad, etc.)

Feature phone (regularcellphone)

Internet-Enabled Device (iPodNano, iPod Touch or other)

Ownership

29

Questions? Kristina Sruoginis Research Director, IAB kristina@iab.net Joe Laszlo Sr. Director Mobile Marketing Center of Excellence, IAB joe@iab.net Sherrill Mane SVP Research, Analytics, Measurement, IAB sherrill@iab.net

Showrooming: Empowering Consumer Electronics

Shoppers