From instant price comparisons, to first hand consumer reviews, to video demonstrations, shoppers are taking advantage of this wealth of information. Consumers depend on search engines more than other resources to help them shop online. 3 out of 5 shoppers said that they always or often use search engines when shopping online. More consumers use search engines than they do coupon sites, retailer emails, consumer reviews, or shopping comparison sites.
Frequency of Using Tools Shopping Online (% of Respondents) | |
Online Tools | % of Respondents Using Always or Often |
Search engines | 61% |
Coupon sites | 35 |
Retailer emails | 29 |
Online product/retail reviews | 24 |
Shopper comparison sites | 22 |
Shopping portals | 19 |
Social networking sites | 10 |
Source: Compete.com, February 2010 |
The study finds that the differences in consumer behavior across various industries have vast implications for retailers within each sector. Sales assistants, both in store and on web chat, are utilized by online shoe shoppers more than any other shoppers. Online kitchenware & household appliance purchasers are among the most reliant on in store product displays.
In the apparel industry, only 1 out of 10 apparel shoppers stated that they used a search engine for their last online purchase. Instead, they rely on retailer emails and catalogs to learn about products. That means consumers are more likely to purchase from apparel retailers they have purchased from in the past and are less likely to discover new retailers.
Information Sources Used Before Purchasing Apparel | |
Information Source | % Apparel Purchasers |
Email from retailer | 38% |
Retail websites | 26 |
Retailer mailing | 23 |
Online advertisement | 18 |
Search engines | 12 |
Source: Compete.com, February 2010 |
Electronic shoppers, on the other hand, actively seek out new products and manufactures, says the report. Search engines, professional reviews, social generated reviews, and recommendations from family and friends were among the top 5 resources used. Electronic manufactures can reach and influence these consumers more easily though a variety of media.
Information Sources Used Before Purchasing Electronics | |
Information Source | % of Electronic Purchasers |
Retail websites | 59% |
Search engines | 45 |
Online professional reviews | 29 |
Consumer online reviews | 21 |
Friends, family, colleagues | 14 |
Source: Compete.com, February 2010 |
It is essential, says the report, for retailers to understand how consumers in their space shop online, in order to effectively retain and acquire customers. Retailers should understand their particular customer niche and develop strategies unique to them, concludes the report.
And, in a correlative study regarding information sources, by Opinion Research Corporation and sponsored by ARAnet, young and highly educated consumers say online information sources influence their buying decisions at a markedly higher rate than the rest of the population. Personal advice from friends or family members was by far the most influential source, followed by TV broadcasts and search engines.
Scott Severson, president of ARAnet, says "The eyes of young people 18 to 34... (as well as)... highly educated Americans are looking online to search engines, online articles, online ads, email offers and social media to a degree that is head and shoulders above the average citizen."
According to the study, consumers in the 25-to-34 age range expressed strong preference for:
The following data summary shows the percentage of respondents choosing a 4 or 5 out of 5 - where 1 is NOT influential at all, and 5 is VERY influential in buying decisions, and the mean summary rating points:
Influence In Buying Decisions | ||
Influence | % Very Influenced (4 or 5 out of 5) | Average of Rating Points |
Personal advice from friends or family members | 59% | 3.6 out of 5 |
TV news or other broadcasts | 40% | 3.1 |
Search engines such as Google, Bing, Yahoo, or Ask.com | 39% | 3.0 |
Ads seen on TV | 36% | 3.0 |
Articles seen in newspapers or magazines | 33% | 3.0 |
Ads seen in newspapers or magazines | 31% | 2.9 |
Articles seen online | 28% | 2.8 |
Radio news or other broadcasts | 25% | 2.7 |
Direct mail | 24% | 2.7 |
Ads heard on the radio | 20% | 2.6 |
Emails received from retailers or manufacturers | 20% | 2.5 |
Ads seen online | 19% | 2.5 |
Messages or posts on social media such as Facebook, Twitter, LinkedIn, or MySpace | 18% | 2.3 |
Billboards | 15% | 2.3 |
Source: ARAnet, February 2010 |
For people making $75,000 or more, the report says, search engines are preferred by 49% vs. 39% for all respondents, a signal that high-income consumers are also following the trend to online sources. This supports the industry trend of a higher percentage of marketing budgets flowing into online and digital tactics.
Severson concludes that "Search engine optimization and backlinks from advertising and public relations efforts are providing information in the places where high-value consumers are influenced about buying decisions."
To see more about the younger consumers, please visit the ARA here, or to find more information from the Online Shopper Intelligence study, please go here.
This is going to be deadly to retailers, especially for big ticket items. I have written about this in my blog in the past. Imagine going to a store to buy a big screen HDTV. You have your Andriod or IPone with you. You find the model you like, do a quick search on the phone to compare prices and you approach the salesperson. You say I can get this $3000 TV for $2700 on sale at your competitor. I like your store. Match the price I buy now or I walk. What does the retailer do?
The issue with Big Ticket vs normal CPG's is you won't be buying a TV again for a few years possibly. So it's not like you will be back in 2 weeks. I can also see electronic shopping lists that allow compare supermarket prices so a consumer can split their weekly trip between two markets getting the best values.
Great developments for consumers. Not sure about for retailers.
As always, all forms of advertising/publicity/PR purpose is getting the customer inside the door (various forms of doors today). It is the customer experience once inside from decor to merchandise availability and customer service as well as price are what separates the purchaser and their money.