American Online Purchase Behavior

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American Online Purchase Behavior

  1. 1. American Online Purchase Behavior March, 2008
  2. 2. Table of Contents I. Objectives………………………………………………………………………………………………………………………………………………………... v II. Methodology…………………………………………………………………………………………………………………………………………………….vii III.Executive Summary………………………………………………………………………………………………………………………………………...6 IV. Detailed Findings……………………………………………………………………………………………….……………………………………………. 7 a. Making Purchase Decisions – The Online Versus In-Person Shopper………………………………………………….... 7 i. Purchasing By Channel & Product Type………………………………………………………………………………………..……. 7 1. Household Penetration In The Past Month………………………………………..……………………………….…………8 2. Gender & Child Status……………………..…………………..……………………………………………………….…………….. 9 ii. Researching A Product Or Service Prior To Purchase Online.…………………………………………………………...10 1. Household Penetration In The Past Six Months………………………………………………………..………………… 11 iii. Using A Recommendation From A Friend To Make A Purchase Decision………………………….…………..….12 1. Household Penetration In The Past Month……………………………………………………………….……………..….13 iv. Using Services Of A Clerk Or For-Hire Consultant in Making A Purchase Decision………………………….14 1. Household Penetration In The Past Year…………………………………….……………………………………………….15 b. Other Consumer Uses Of The Internet – The Online Versus In-Person Shopper……………………..…………16 i. Researching A Medical Condition Or Diagnosis Using The Internet……..……………..……………...………….16 1. Household Penetration In The Past Year……………………………………………………………………………………….17 ii. “Scrapbooking”……………………………………………………………………..…………………………………………………….….…….18 1. Household Penetration In The Past Year……………………………………………………………………………………….19 2. Incidence of Consumer “Scrapbooking” By Format By Channel……………………………………………….…20 V. Appendix…………………………………………………………………………………………………………………………………………….………………21 a. Questionnaire…………………………………………………………………………………………………………………………………….………….21 i
  3. 3. I. Objectives Americans buy over $8.3B of goods and services annually, or $46,409 on average per household.* Some of it is food, some of it is non-food, and there are now a multitude of choices available as to where and how to get these products, including the internet. With the advent of the worldwide web, the consumer has been afforded instant access to a wide variety of information, enticing them to become mini experts, without significant time or effort, from the privacy of their own home. To many, using the internet to gather information, communicate with friends and strangers with common interests and to tap into a new shopping channel to shop directly excites and empowers like never before. Technological advancement has offered information instantly to the consumer -- almost where ever they may be located when the need arises. A fast and always available internet has allowed people to acquire more information, plan ahead, develop an expertise in a wider array of topics and to become more confident in making decisions, leading to a strong sense of empowerment and control over their lives. This quest for control beckons consumers to actively shop for more unique and customized items, rather than passively shop among whatever offerings retailers choose to provide. * Economic Report of the President, February 2008 and Consumer Expenditures in 2005, U.S. Department of Labor, February 2007 v
  4. 4. I. Objectives General Growth Properties, Inc.’s has commissioned this study to determine where consumers buy what type of goods and services and the current impact of the internet as a shopping channel option. The following report summarizes the findings of “American Online Purchase Behavior.” vi
  5. 5. II. Methodology A nationally representative sample of 1084 online surveys was completed among adults 18+ January 8 - 11, 2008, yielding 515 qualified online purchasers and 1003 in-person purchasers. The following special notations were applied in the data tables. Bolded numbers indicate a statistically significant difference between groups at a 90% confidence level or above, and □’s indicate a dominant trend in the data across groups, which may or may not be supported by statistical significance relative to other groups. vii
  6. 6. IV. Detailed Findings a. Making Purchase Decisions – The Online Versus In- Person Shopper i. Purchasing By Channel & Product Type Prediction is that North American household penetration of “e-shopping,” or shopping online, will reach nearly 100% by 2020.* Furthermore, it is estimated that online shopping for groceries will reach 34% of total retail sales by 2010.* Currently however, just 29% of households claim to buy online, with just 3% of households buying food online. Almost two-thirds of consumers buy in-person (60%), with the majority of these transactions being for food (58% of all purchases or 97% of all in-person purchases). Just over half of all purchasers are women, with slightly more making internet purchases (57%) than in- person (55%). Like the aging population, the largest proportion of adult purchasers are child-free, with slightly more childless adults (60%) buying in-person than online (57%). The majority of online purchasers also tend to be women (57%) with no children living at home (57%), however there are still a significant number of online buyers (43%) who have children living at home. In fact, a significant number of Americans have used the internet and made a conscious decision to stop. As of 2003, approximately 15M people have been online at one time, but have discontinued the practice as a way to strike back against technology rudeness and protect themselves from the dishonest.** These consumers tend to be young, urban and employed.** * futureconsumer.com by Frank Feather, 2000 ** Pew Internet and American Life Project, The Ever-Shifting Internet Population, 2005 and U.S. Census, 2006 6
  7. 7. i. Purchasing By Channel & Product Type 1. Household Penetration Past Month Almost two-thirds of consumers buy in-person (60%), with the majority (58% of all consumers or 97% of all in-person purchases) of these transactions being for food. Just 29% of consumers currently shop online for anything. Household Penetration of Online Versus In-Person Shopping in the Past Month (Base: Total Sample) (1084) % Net Purchasers 89 Net In-Person 60 Food In-Person 58 Non-Food In-Person 39 Net Online 29 Non-Food Online 14 Food Online 3 Net Non-Purchasers/None 11 Q1: In the past month, which of the following ways have you, yourself purchased products for yourself or your family? 7
  8. 8. i. Purchasing By Channel & Product Type 2. Gender & Child Status Just over half of all purchasers are women, with slightly more making internet purchases (57%) than in-person (55%). Online purchasers tend to be women (57%) with no children living at home (57%), however there are still a significant number of online buyers (43%) who have children living at home. Gender & Child Status of Online Versus In-Person Shoppers Online In-Person (Base: Shopper Type) (515) (1003) % % Gender Female 57 55 Male 43 45 Child Status Without Children 57 60 With Children 43 40 Q1: In the past month, which of the following ways have you, yourself purchased products for yourself or your family? 8
  9. 9. IV. Detailed Findings a. Making Purchase Decisions – The Online Versus In- Person Shopper (Con’t) ii. Researching A Product Or Service On The Internet Prior To Purchase Faced with a complicated marketplace and a risky and sometimes horrific world, consumers have become experienced in exerting control over the marketplace. They are smarter and more sophisticated than ever before…and they know it. Seventy-three percent (73%) of consumers feel that “as a shopper, I feel more in charge today than I used to” and 81% “feel much more knowledgeable and powerful about what I buy and where I shop than ever before.”* Over half (58%) of consumers in this study researched a product or service on the internet prior to making a purchase decision in the past six months. As expected, significantly more online shoppers (71%) researched a purchase online prior to buying than in-person shoppers (58%). The majority of pre-purchase internet researchers are women (32% of all purchasers, 55% of researchers), especially among online shoppers (40%). * Yankelovich Monitor, 2006 9
  10. 10. ii. Researching A Product Or Service Prior To Purchase Using The Internet - The Online Versus In-Person Shopper 1. Household Penetration Past 6 Months Significantly more online shoppers (71%) researched a purchase online prior to buying than in- person shoppers (58%). The majority of pre-purchase internet researchers are women (32% of all purchasers, 55% of researchers), especially among online shoppers (40%). Household Penetration of Pre-Purchase Internet Researchers in the Past 6 Months By Channel Total Online In-Person (Base: Shopper Type) (1037) (515) (1003) % % % Total 58 71 58 Gender Female 32 40 32 Male 26 31 26 Q4: In the past six months, have you, yourself, completed research or information-gathering on a product or service using the internet prior to making a purchase, yes, or no? 10

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