Showrooming is a shopping strategy wherein consumers touch and feel the products in a brick-and-mortar store but purchase the products from an... Show moreShowrooming is a shopping strategy wherein consumers touch and feel the products in a brick-and-mortar store but purchase the products from an online-exclusive store that offers a lower price. With improvements of IT technology, such as high-speed internet and mobile phone usage, showrooming is now widely used by consumers worldwide. Brick-and-mortal stores have observed and regarded showrooming not only as a threat but also as a cause of their sales decline. Brick-and-mortar stores have adopted strategies such as price matching and loyalty programs to battle showrooming impact to some extent, but not effectively. The main goal and objective of this study is to assess the conditions and parameters most influencing the showrooming phenomenon and its impact on the survival of brick-and-mortar stores, followed by developing model approaches for the design and evaluation of the best strategies to address competition provided by online stores, focusing on the impact of showrooming. The results of theoretical modeling performed in this study suggest that (a) brick-and-mortar stores suffered from showrooming effects; (b) price matching can help brick-and-mortar stores to alleviate showrooming effects only under certain conditions; (c) price matching could negatively impact consumers’ surplus instead of benefiting them due to cost increases due to price matching policy; (d) price matching is a product-specific strategy rather than a store-wide policy; (e) while a manufacturer benefits from the price match policy, it also shares a portion of its profit to motivate offline retailers to offer a price matching policy; and (f) offline retailers can alleviate showrooming effects by strategically carrying parts of the product line. The application of the proposed modeling strategy is presented in two case studies concerning high- and low-cost products. Ph.D. in Management Science, May 2018 Show less
