Store Charges Customers $5 'Just Looking' Fee To Combat Showrooming

[If_I_Loved_you]

A new business model for those Freeloaders that Never Buy in your place of business. 

Store Charges Customers $5 'Just Looking' Fee To Combat Showrooming

Read more: http://www.businessinsider.com/stores-charges-just-looking-fee-2013-3#ixzz2OfTNFxgY

There's a store in Australia that really hates it when its customers walk around the store without buying anything.

Redditor BarrettFox posted a pic of a sign informing shoppers of a new fee at a specialty food store in Brisbane.

It's $5 for "just looking."

The fee exists to stop people from "showrooming" â€" which occurs when a customer looks at items in a physical store, then makes the purchase online.

The sign assures that you'll have the five dollars deducted from the final purchase so you'll get your money back if you buy something.

Here's what the sign says:

As of the first of February, this store will be charging people a $5 fee per person for “just looking.”

The $5 fee will be deducted when goods are purchased.

Why has this come about?

There has been high volume of people who use this store as a reference and then purchase goods elsewhere. These people are unaware our prices are almost the same as the other stores plus we have products simply not available anywhere else.

This policy is line with many other clothing, shoe and electronic stores who are also facing the same issue.

Management

The policy is being ripped apart unanimously.

"It has to be the most misguided strategy we've seen for dealing with showrooming," wrote Matt Brownell at Daily Finance. "The goal of any retailer should be to impress customers with competitive pricing and great customer service â€" not treat their customers with suspicion and hostility from the moment they walk in the door."

"If customers aren’t buying, the seller needs to figure out why and adapt accordingly," wrote Chris Morran at The Consumerist. "If this store’s prices are truly the best, then maybe it should be offering a price-match guarantee. If it truly offers products that aren’t available elsewhere, then how are these showrooming shoppers buying these items from someone else?"

The commenters in the Reddit thread were more straightforward.

"This store seems desperate to go out of business," quipped one commenter.

"If it was me, I'd say 'Screw you.' and not give them a dime, walk out and refuse them any future business," wrote another. "They are asking to go out of business."

And those were the polite ones.

[Debbie Thompson]

Although this is the height of bad marketing, I actually get it.  They have to support brick and mortar.  They often can't compete with online retailers on price.  With our smart phones and Red Laser apps, we can go into a store, look over the merchandise, zap the bar code, and see if we can buy it online cheaper. I feel for brick and mortar stores these days.  If they can't match prices from online retailers and make money, how are they supposed to survive?

[If_I_Loved_you]

Although this is the height of bad marketing, I actually get it.  They have to support brick and mortar.  They often can't compete with online retailers on price.  With our smart phones and Red Laser apps, we can go into a store, look over the merchandise, zap the bar code, and see if we can buy it online cheaper. I feel for brick and mortar stores these days.  If they can't match prices from online retailers and make money, how are they supposed to survive?

This from Huff Post Money "Although the store claims on its sign that its prices are "almost the same as the other stores," many brick-and-mortar shops are having a hard time competing with prices online. A January study from International Business Machines Corp. revealed that close to 50 percent of online purchases were initially browsed in stores by customers, the Wall Street Journal reports.

Another study in February found that big box retailers like Bed Bath and Beyond, PetSmart and Toys ‘R’ Us stand to lose the most from "showroomers" who come to the store to try out a product but then purchase the item on Amazon, The New York Times reports. Stores like Best Buy and Target have responded to the increased competition online with permanent price-matching guarantees, according to Bloomberg.

To be fair, Celiac Supplies promises that it will return the $5 to customers who eventually purchase something, but sneaky showroomers will still go home empty handed -- literally." http://www.huffingtonpost.com/2013/03/26/just-looking-fee-australian-grocery-store_n_2955754.html

Celiac Supplies website is http://www.celiacsupplies.com.au/home?subSiteId=1

[coredumped]

So Costco?

Really though, they should do price matching with online retailers if possible. I think it's great best buy matches amazon now. Previously I just used them for a showroom. I don't mind paying taxes to support local workers.

[cityimrov]

If they can't match prices from online retailers and make money, how are they supposed to survive?

How about competing on everything else?  The only thing Amazon can compete on is price (if they are even providing what the local store is providing).  A local store can compete on everything else.  How can't they?  They live there!  They know the people, they know their needs, they SHOULD know the territory much more than Amazon will ever know. 

The bigger question is, why can't a store who knows the locals compete against a company who doesn't even have a physical presence in their state?

[spuwho]

So Costco?

Really though, they should do price matching with online retailers if possible. I think it's great best buy matches amazon now. Previously I just used them for a showroom. I don't mind paying taxes to support local workers.

Costco, Sams, BJ's all charge a membership fee for the right to shop, perhaps this guy in the AU should start a club to sell his stuff.

[peestandingup]

If they can't match prices from online retailers and make money, how are they supposed to survive?

How about competing on everything else?  The only thing Amazon can compete on is price (if they are even providing what the local store is providing).  A local store can compete on everything else.  How can't they?  They live there!  They know the people, they know their needs, they SHOULD know the territory much more than Amazon will ever know. 

The bigger question is, why can't a store who knows the locals compete against a company who doesn't even have a physical presence in their state?

The problem is, everyone's selling the same crap anyway & its all corporate regardless, so shopping "local" really doesn't matter if its between Giant Corporation A or Giant Corporation B. Its just that the brick & mortar corporate store has to inflate the price in order to justify its existence, a lot of times double or triple what you can find an item for online & then have it delivered to your door instead of gassing up your car & going to these places to retrieve it (while getting ripped off). Which is why brick & mortar can never compete simply because of what it is. Too much useless overhead that gets passed on to the customer.

Now truly local places will survive (like restaurants, coffee shops, meeting type places, bars, speciality stores, boutiques, etc), but all that suburban box box crap full of the same stuff is going bye bye. I'd bet that most of what we have known as "retail" up to this point won't be here in 10 years. Many jobs will be lost, entire swaths of suburban retail districts will be empty, etc. But maybe its for the best & it'll cause us all to rethink why we're actually here, what it means to be a productive member of society, and shift things back to truly local economies & better planning.