Showrooming: The Future of Retail

Amazon.com recently offered customers a “Brick-and-Moral dilemma” through their price-check app, which offers shoppers quick discounts if they scan a barcode and find what they’re buying on Amazon for less. It’s provoked protests from some bookstore owners, and disgust from others.

But it should provoke optimism. When Amazon sees someone run the price-check app, here’s what they know:

1. What that person is buying.
2. Where they found it.
3. Roughly what price they think constitutes a good deal.

Some bookstores are considering banning phones. Right now, that’s a good option. But Amazon could use their price checking app as a way to integrate the retail bookstore experience with Amazon’s technical backend. After all, they have enough information to know which bookstore gets credit for turning a customer on to a particular book—so why not explore the economics of paying that bookstore for the new customer?

For independent bookstores, the storefront is tough, but the real pain is in the back: ordering enough inventory, keeping boring titles in stock, dealing with the new releases you absolutely have to have in stock but that don’t necessarily sell all that well—the worst part of running an independent bookstore happens to be the part that Amazon excels at. If bookstores don’t need the capital for inventory, and can get a cut of Amazon’s rich margins, they can afford to maintain the bookstore experience while outsourcing the logistics to Amazon.

The future of the bookstore isn’t a “for lease” sign. It’s a combination of coffeeshop and showroom; the only physical thing customers will buy and take out of the store will be the Kindles on sale by the register.

(Sound too radical? Amazon is already treating its product pages as ad space and turning its ad expertise into a new ad business. They know their strengths, and they know a good PR opportunity when they see one. And through Amazon Associates they’ve been paying random third parties a cut of each sale they bring in for over a decade. This is one app update away from reality.)