CFIB warns that showroom shopping hurts communities
Toronto, November 27, 2019 – “Showrooming” – when shoppers visit local businesses to try out or learn about a product, but then buy it from a big box store or online competitor – is a major problem for independent merchants heading into the busy holiday season, warns the Canadian Federation of Independent Business (CFIB). In fact, 60 per cent of independent retailers say they have experienced showrooming, with a third of those saying it’s having a significant impact on their business, according to a new CFIB survey. A separate poll of shoppers finds that 55 per cent of consumers are doing it.
“When customers go into independent stores to ask questions or try on merchandise and then take a picture or write down a model number so they can buy the item online, they might not be aware that they’re not just taking away a sale – they’re taking money away from their neighbourhoods. These are the shops that support local kids’ hockey teams or donate to the community foodbank every Christmas,” said Dan Kelly, CFIB’s president. “They care about their customers and want to help and share their expertise, but their rent, their property taxes and their employees need to be paid. Ultimately, when consumers take up the time of local retailers but spend their money elsewhere, it’s our communities that suffer.”
Showrooming is a major pain point for small retailers
Shoppers aged 18 to 34 were more likely than older consumers to showroom shop, with three out of four admitting to having done it, and one in seven even saying they do it often according to a survey CFIB conducted among a representative sample of Canadians who are members of the Angus Reid Forum.
CFIB received hundreds of comments from retailers detailing their showrooming experiences:
One had a customer so bold that after spending time discussing a product, they ordered it online from a different retailer right there on the spot.
A jeweler in Manitoba said a customer consulted her at length to choose the best design and materials for a custom bracelet but ordered it online.
A paint store in Ontario has homeowners and builders who come in for colour advice, but take the paint sample to a big box store to get a match in a cheaper product.
“You wouldn’t sit down in a restaurant just to read the menu and get some cooking tips from the chef before heading to the grocery store,” added Ryan Mallough, Director at CFIB and lead author of the report. “Showrooming may seem harmless, but can really hurt independent retailers, and undermine the health of local communities – especially during the make-or-break holiday season when they’re competing against big box stores and online giants.”
Holiday cheer not lost on independent retailers
Independent retailers are deeply grateful and appreciative of their customers.
“While small retailers wish their customers might better understand the challenges they face and the contributions they make to their communities, the number one thing they wanted to say to their customers was ‘thank you’,” concluded Kelly. “With Black Friday and Cyber Monday kicking off the holiday shopping season, we encourage consumers to save themselves the crowds and clicks and visit their local, independent merchants. They’ll thank you and pay it forward.”
Read the full survey results for more details.
The public opinion survey was conducted by CFIB from September 11 to 13, 2019 with a representative sample of n=1,510 online Canadians who are members of the Angus Reid Forum. The survey was conducted in English and French. The precision of Angus Reid Forum online polls is measured using a credibility interval. In this case, the poll is accurate to within +/- 1.8 percentage points, 19 times out of 20, had all Canadians been polled. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.
The CFIB National Retail Sector survey was conducted from November 7 to November 21, 2019 and is based on a sample of 1,370 small business owners from Canada. For comparison purposes, a probability sample with the same number of respondents would have a margin of error of plus or minus 2.65 per cent, 19 times out of 20.