Online Shopping Up, But No Heavy Spending

by , Dec 19, 2001, 12:00 AM
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Recently released data from Scarborough Research shows Americans are shopping more online, but not spending heavily.

The company reports that 61% of American adults have Internet access, with 41% of its test group shopping on the Internet within the past year. Twenty-six percent spent at least $100 and 12% spent more than $500.

"Online shopping has increased in popularity and they're spending more. But it's still a baby as to how comfortable they are," says Scarborough president Bob Cohen. "They don't buy much and don't spend large amounts online."

Over 40% of the group shopped once, 35% made a purchase and 18% shopped ten or more times. Seven percent made ten or more purchases. Cohen sites "a big drop in regular shoppers."

There is a distinction between shopping and purchasing because not all online shoppers make purchases. High-ticket items like jewelry and cars get high shopping numbers but not purchasing because shoppers use the Internet for research without intending to buy online, Cohen says.

Shopping is the second most popular Internet activity, after email, the study reports.

The top products for online shopping are books and airline tickets, each accounting for 29% of online purchases, followed by CDs/music and clothing, 21% each. These products sell well because they are "tangible, small ticket media items that don't require a lot of research and don't need to be touched before purchasing," Cohen says. Music sells well because it can be listened to online before purchasing. Airline tickets sell well because they can be bought online at lower prices.

Scarborough studied online shopping locally, determining that it is highest in the cities with highest Internet penetration: San Diego, Seattle, Austin, TX, Washington DC and San Francisco. In San Francisco, 55% of the sample shopped online within the past year (compared with the national average of 41%); in Austin, 40% spent $100 (compared with the national average of 26%).

When asked why Internet retailers should care about local numbers, since the Internet isn't a local medium, Cohen said, "If you're a marketer of Internet services it is important to understand that Internet access varies across local markets and some are more receptive to product offers." He also said different types of offline advertising that promotes online shopping, such as billboards and newspaper inserts, should be used in the markets with highest Internet penetration.

The Scarborough research notes that Internet penetration has increased 8% from last year. Online shopping has increased 22%, Online purchasing has increased 21%. Spending $100 has increased 16%. And, spending over $500 has increased 7%.

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