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© comScore, Inc. Proprietary.
State of the U.S. Online Retail
Economy in Q1 2014
May 2014
Gian Fulgoni, Co-Founder & Chair...
© comScore, Inc. Proprietary. 2
Topics for Today
 Review of Key Macroeconomic Trends
 Consumer Perceptions of the Econom...
© comScore, Inc. Proprietary. 3
Data sourced from comScore’s global panel of 2 million Internet users
2 Million Person Pan...
© comScore, Inc. Proprietary. 4
 E-Commerce data includes all worldwide buying on U.S. sites
(desktop buying only)
 Unle...
© comScore, Inc. Proprietary. 5
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Q1
'05
Q2
'05
Q3
'05
Q4
'05
Q1
'06
Q2
'06
Q3
'0...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
State of the Economy
A Review of Key Macroeconomic Trends
© comScore, Inc. Proprietary. 7
At +12% growth year over year, e-Commerce continues to outpace
offline retail growth, whic...
© comScore, Inc. Proprietary. 8
Desktop e-Commerce (retail + travel) was up +10% Y/Y overall and
+12% Y/Y for Retail in Q1...
© comScore, Inc. Proprietary. 9
Mobile commerce, when added to desktop e-Commerce, grew 13% in
Q1 and registered the large...
© comScore, Inc. Proprietary. 10
When including both mobile and desktop spending, e-Commerce
accounted for 13.2% of consum...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Consumer Perceptions of the Economy
© comScore, Inc. Proprietary. 12
While most still believe the economy is ‘poor’ or ‘fair’, negative
sentiment declined 5 p...
© comScore, Inc. Proprietary. 13
Consumer concern shifted even more toward ‘rising prices’ this
quarter, as concern for un...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Retailer and Product Category Overview
© comScore, Inc. Proprietary. 15
Overall dollar sales increased by 12% via desktop e-Commerce in Q1
(versus Q1 2013)
Metri...
© comScore, Inc. Proprietary. 16
Desktop computers
+5%
Led by apparel/accessories and CPG, nearly all e-Commerce
categorie...
© comScore, Inc. Proprietary. 17
43%
50% 48% 51%
44%
67%
58%
57%
50% 52% 49%
56%
33%
42%
Q3
2012
Q4
2012
Q1
2013
Q2
2013
Q...
© comScore, Inc. Proprietary. 18
Free Shipping is the new normal for the majority of top online retailers,
but Amazon fall...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Amazon Prime & Retailer Rewards Programs
© comScore, Inc. Proprietary. 20
Amazon Prime members (approximately 50% of Amazon sales)
showed significantly higher doll...
© comScore, Inc. Proprietary. 21
Amazon Prime buyers skew slightly older than non-Prime buyers, with
more than half age 40...
© comScore, Inc. Proprietary. 22
Among current users of Amazon Prime,
most (77%) are satisfied with the program…
45%
32%
2...
© comScore, Inc. Proprietary. 23
Amazon Prime’s $20 price increase to $99/year does not seem to be
deterring prospective u...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Consumers’ Omnichannel Path to Purchase
© comScore, Inc. Proprietary. 25Source: comScore Survey – February 2014
Consumers were asked to rate a wide variety of sho...
© comScore, Inc. Proprietary. 26
Different tools for different purposes…and still a role for traditional
media. Mobile cou...
© comScore, Inc. Proprietary. 27
2013 2014
Saves Me Money #17 #16
Saves Me Time #16 #14
Helps With New Ideas #21 #16
While...
© comScore, Inc. Proprietary. 28
Mobile coupon usage up 41% in the past year, with females age 18-44
34% more likely than ...
© comScore, Inc. Proprietary. 29
Mobile phones have the highest search conversion rate in comparison
to desktop computers ...
© comScore, Inc. Proprietary. 30
Mobile driving omnichannel commerce as 3 out of 4 mobile searches
resulting in a purchase...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Mobile Commerce and the Multi-Platform Shopper
© comScore, Inc. Proprietary. 32Source: comScore MobiLens/TabLens 3 month average ending December
Continued strength in ad...
© comScore, Inc. Proprietary. 33
Mobile commerce, which reached $7.3 billion, accounted for nearly 12%
of total digital do...
© comScore, Inc. Proprietary. 34
In terms of discretionary spending, m-Commerce growth is still
outpacing e-Commerce & bri...
© comScore, Inc. Proprietary. 35
While categories such as computer hardware still lean heavily to
desktop, digital content...
© comScore, Inc. Proprietary. 36
Mobile has become the primary medium for consumers to engage with
retail brands online
0
...
© comScore, Inc. Proprietary. 37
Several leading retailers seeing rapid growth in their number of
mobile-only visitors, hi...
© comScore, Inc. Proprietary. 38
Mobile-only traffic in the retail category skews heavily towards younger
consumers. Nearl...
© comScore, Inc. Proprietary. 39
0 50,000 100,000 150,000
Amazon Sites
eBay
Apple.com Sites
Wal-Mart
Target Corp.
Best Buy...
© comScore, Inc. Proprietary. 40
Apps done right: Target hit a home run with Cartwheel rollout as
evidenced by huge gains ...
© comScore, Inc. Proprietary. 41
Target’s mobile usage is up 251% y/y, with Cartwheel accounting for
80% of the total incr...
© comScore, Inc. Proprietary. 42
73%
50%
24%
18%
18%
2%
Price was better online
Planned to buy online but wanted to see it...
© comScore, Inc. Proprietary. 43
While overall, 35% of online consumers have utilized ‘showrooming,’
this behavior varies ...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Social Commerce
© comScore, Inc. Proprietary. 45
Social media users spend 31% more than average online, and
Pinterest users spend nearly 2...
© comScore, Inc. Proprietary. 46
Facebook remains an important advertising channel for retailers that
drives both brand aw...
© comScore, Inc. Proprietary. 47
Is Pinterest ready to take a bigger slice of the social commerce pie?
Paid ads via ‘Promo...
© comScore, Inc. Proprietary. 48
Pinterest is gaining influence as a social commerce channel, but
usage continues to shift...
© comScore, Inc. Proprietary. 49
Why else should retailers care about Pinterest? Ability to generate
very high reach among...
© comScore, Inc. Proprietary. 50
Other attempts at social commerce include Amazon and Twitter
partnering to easily add ite...
© comScore, Inc. Proprietary.© comScore, Inc. Proprietary.
Key Takeaways
© comScore, Inc. Proprietary. 52
Key Takeaways
• Q1 2014 Total Digital Commerce accelerated marginally to 13% y/y as it
co...
© comScore, Inc. Proprietary.
www.comscore.com
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@comScore
Please contact us at learnmore@comsc...
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State of the US Online Retail Economy FY2014 Q1

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Transcript of "State of the US Online Retail Economy FY2014 Q1"

  1. 1. © comScore, Inc. Proprietary. State of the U.S. Online Retail Economy in Q1 2014 May 2014 Gian Fulgoni, Co-Founder & Chairman Emeritus, comScore, Inc. Andrew Lipsman, VP Marketing & Insights, comScore, Inc. Ian Essling, Sr. Research Manager, comScore, Inc.
  2. 2. © comScore, Inc. Proprietary. 2 Topics for Today  Review of Key Macroeconomic Trends  Consumer Perceptions of the Economy  Buyer Metrics & Product Category Overview  Amazon Prime  The Omnichannel Path to Purchase  Mobile Commerce and the Multi-Platform Consumer  Social Commerce  Key Takeaways  Q & A
  3. 3. © comScore, Inc. Proprietary. 3 Data sourced from comScore’s global panel of 2 million Internet users 2 Million Person Panel 360°View of Person Behavior CENSUS Unified Digital Measurement™ (UDM) Patent-Pending Methodology 1 Million Domains Participating Adopted by 90% of Top 100 U.S. Media Properties PANEL PERSON-Centric Panel with WEBSITE-Census Measurement Web Visiting & Search Behavior Online Advertising Exposure Advertising Effectiveness Demographics, Lifestyles & Attitudes Media & Video Consumption Transactions Online & Offline Buying Mobile Internet Usage & Behavior PANEL V0411Plus 5 Million TV Set Top Boxes for 3-Screen Measurement
  4. 4. © comScore, Inc. Proprietary. 4  E-Commerce data includes all worldwide buying on U.S. sites (desktop buying only)  Unless explicitly stated otherwise, the term e-Commerce refers to online retail spending, as measured by comScore, which excludes travel, autos and auctions  Total Digital Commerce is the sum of e-Commerce (desktop) and m- Commerce (mobile)  Behavioral activity shown includes data through March 2014  Custom comScore Survey  week of April 21, 2014 (n=2,772)  Unless otherwise noted, the terms “mobile” and “m-Commerce” refer to “smartphone” plus “tablet” Analysis Parameters & Definitions – Q1 2014 Data
  5. 5. © comScore, Inc. Proprietary. 5 -10% -5% 0% 5% 10% 15% 20% 25% 30% 35% 40% Q1 '05 Q2 '05 Q3 '05 Q4 '05 Q1 '06 Q2 '06 Q3 '06 Q4 '06 Q1 '07 Q2 '07 Q3 '07 Q4 '07 Q1 '08 Q2 '08 Q3 '08 Q4 '08 Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10 Q2 '10 Q3 '10 Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Q1 '14 Validation of comScore sales data: Comparison of comScore data to U.S. Department of Commerce Quarterly U.S. e-Commerce Growth* vs. YA Source: comScore & U.S. Department of Commerce (DOC) %Growthvs.YA Dept. of Commerce (DOC) comScore Estimate of DOC *Note: To be consistent with DOC, comScore estimate excludes travel and event tickets but includes auction fees and autos. Correlation: 0.92
  6. 6. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. State of the Economy A Review of Key Macroeconomic Trends
  7. 7. © comScore, Inc. Proprietary. 7 At +12% growth year over year, e-Commerce continues to outpace offline retail growth, which grew at only 1% Y/Y *Note: The U.S. Department of Commerce calculation includes total retail and food service sales, which also includes motor vehicles and parts dealers. 3% 2% 2% 1% -5% -5% -6% -6% 0% 4% 5% 6% 7% 6% 4% 4% 3% 6% 2% 2% 2% 1% 4% 5% 4% 1% Q4 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Quarterly Retail & Food Services Sales Growth vs. YA (excluding autos, gas and food/beverage) 11% 13% 6% -3% 0% -1% -2% 3% 10% 9% 9% 11% 12% 14% 13% 14% 17% 15% 15% 14% 13% 16% 13% 11% 12% Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Quarterly Desktop e-Commerce Sales Growth vs. YA Source: comScore e-Commerce Measurement Quarterly Retail & Food Services Sales Growth* vs. YA Source: U.S. Department of Commerce (DOC) 4% 2% 1% -8% -10% -9% -7% 2% 6% 7% 5% 8% 7% 7% 7% 5% 8% 4% 3% 3% 2% 4% 5% 4% 2% Q1 2008 Q2 2008 Q3 2008 Q4 2008 Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014
  8. 8. © comScore, Inc. Proprietary. 8 Desktop e-Commerce (retail + travel) was up +10% Y/Y overall and +12% Y/Y for Retail in Q1 2014, with a total of $86 billion $42 $53 $67 $82 $102 $123 $130 $130 $142 $162 $186 $211 $56 $30 $40 $51 $61 $69 $77 $84 $80 $85 $94 $103 $111 $30 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Q1 2014 Retail Travel Desktop e-Commerce Dollar Sales ($ Billions) Source: comScore e-Commerce Measurement $72 $93 $117 $143 $171 $200 $214 $209 $228 $289 $256 $86 Billions($) +29% +26% +22% +19% +17% +7% -2% +9% +12% +13% +26% +33% +26% +28% +20% +24% +24% +13% +20% +12% +6% +9% 0% -5% +10% +6% +15% +9% +14% +11% +11% +13% +8% +12% +10% $322 +8%
  9. 9. © comScore, Inc. Proprietary. 9 Mobile commerce, when added to desktop e-Commerce, grew 13% in Q1 and registered the largest non-Q4 quarter of total online buying $44.3 $43.2 $41.9 $56.8 $50.2 $49.8 $47.5 $63.1 $56.1 $4.5 $3.8 $4.6 $7.2 $5.9 $4.7 $5.8 $8.3 $7.3 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Desktop Mobile Desktop+Mobile Retail e-Commerce Dollar Sales ($ Billions) Source: comScore e-Commerce Measurement Billions($) $71.4 $56.1 $64.0 $45.4$47.0$48.8 +21% +17% +17% +17% +15% +16% +14% $54.5 $54.3 +12% +13% $63.4
  10. 10. © comScore, Inc. Proprietary. 10 When including both mobile and desktop spending, e-Commerce accounted for 13.2% of consumers’ discretionary spending in Q1 2014 *Note: e-Commerce share is shown as a percent of DOC’s Total Retail Sales excluding Food Service & Drinking, Food & Bev. Stores, Motor Vehicles & Parts, Gasoline Stations and Health & Personal Care Stores. Desktop & Mobile e-Commerce Share of Corresponding Consumer Spending* Source: comScore e-Commerce/m-Commerce & U.S. Department of Commerce (DOC) for Retail e-CommerceShare 7% 7% 8% 9% 8% 8% 10% 10% 9% 10% 11% 12% 11% 10% 12% 13.2% 4% 4% 4% 5% 5% 4% 5% 5% 6% 5% 5% 6% 7% 6% 6% 7% 7% 7% 7% 8% 8% 7% 7% 8% 8% 7% 7% 8% 9% 8% 8% 9% 9% 9% 9% 10% 11% 10% 9% 11% 11.7% e-Commerce Share (desktop+mobile) e-Commerce Share (desktop)
  11. 11. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Consumer Perceptions of the Economy
  12. 12. © comScore, Inc. Proprietary. 12 While most still believe the economy is ‘poor’ or ‘fair’, negative sentiment declined 5 points in Q1 2014… are brighter days ahead? 68% 66% 61% 61% 59% 63% 62% 52% 60% 60% 61% 54% 50% 56% 49% 42% 41% 41% 41% 40% 35% 27% 30% 31% 33% 34% 32% 32% 40% 31% 31% 29% 36% 40% 36% 40% 44% 47% 48% 43% 48% 48% 5% 4% 8% 6% 7% 5% 6% 8% 9% 9% 11% 10% 10% 8% 11% 13% 12% 12% 16% 13% 17% Apr-09 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Poor Fair Excellent/Good Consumer Perceptions of the Economy Q.How would you rate economic conditions today? Source: comScore Surveys *Note: respondents selecting “I don’t know / not sure” accounted for an average of 1.1% of responses in each quarter, and results shown above are rebased to exclude these data
  13. 13. © comScore, Inc. Proprietary. 13 Consumer concern shifted even more toward ‘rising prices’ this quarter, as concern for unemployment / job security dropped to 27% Percent of Respondents Citing Their One Most Important Issue 46% 40% 42% 50% 42% 44% 45% 36% 27% 37% 38% 31% 26% 33% 34% 31% 33% 31% 33% 32% 27% 28% 32% 32% 29% 33% 30% 29% 42% 54% 37% 37% 43% 48% 44% 45% 47% 45% 46% 42% 43% 52% 15% 13%13% 9% 10% 13% 9% 7% 7% 12% 12% 10% 11% 10% 10% 10% 10% 10% 12% 14% 11% 8% 8% 8% 7% 9% 8% 10% 11% 7% 8% 9% 10% 11% 8% 8% 7% 7% 6% 8% 6% 5% Apr 09 Jul 09 Oct 09 Jan 10 Apr 10 Jul 10 Oct 10 Jan 11 Apr 11 Jul 11 Oct 11 Jan 12 Apr 12 Jul 12 Oct 12 Jan 13 Apr 13 Jul 13 Oct 13 Jan 14 Apr 14 Unemployment / Job Security Rising Prices Financial Markets Real Estate / Home Values Q.Based on your current situation, which one of the following economic conditions most concerns you? Source: comScore Surveys
  14. 14. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Retailer and Product Category Overview
  15. 15. © comScore, Inc. Proprietary. 15 Overall dollar sales increased by 12% via desktop e-Commerce in Q1 (versus Q1 2013) Metric Q1 2013 Q1 2014 % change Dollar Sales ($ Billions) $50.2 $56.0 12% Dollars per Buyer $275 $282 3% Buyers (Millions) 183 198 9% Average Order Value $71 $78 10% Transactions (Millions) 703 714 2% Transactions per Buyer 3.85 3.60 -6% Key Desktop e-Commerce Buyer and Transaction Measures Q1 2014 vs. YA Source: comScore e-Commerce Measurement
  16. 16. © comScore, Inc. Proprietary. 16 Desktop computers +5% Led by apparel/accessories and CPG, nearly all e-Commerce categories showed double-digit growth versus Q1 2013 Q1 2014 Desktop e-Commerce Sales Growth vs. YA by Retail Category Source: comScore e-Commerce Measurement Absolute Dollar Rank Product Category Q1 2014 Growth vs. YA #2 Apparel & Accessories Very Strong #3 Consumer Packaged Goods Strong #11 Sport & Fitness Strong #5 Digital Content & Subscriptions Strong #10 Home & Garden Strong #13 Flowers, Greetings & Misc. Gifts Strong #7 Furniture, Appliances & Equipment Strong #1 Computers/Peripherals/PDAs Strong #14 Video Games, Consoles & Accessories Strong #12 Jewelry & Watches Strong #8 Event Tickets Strong #4 Consumer Electronics (x PC Peripherals Strong #6 Office Supplies Moderate #9 Books & Magazines Moderate Food and beverage +15% Growth rate definitions: Very Strong: +15% or higher Strong: +10-14% Moderate: +5%-9% Low: +1%-4% Portable devices (e.g. tablets) +14%
  17. 17. © comScore, Inc. Proprietary. 17 43% 50% 48% 51% 44% 67% 58% 57% 50% 52% 49% 56% 33% 42% Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 % Transactions with Paid Shipping % Transactions with Free Shipping Percentage of e-Commerce Transactions with Free Shipping Source: comScore e-Commerce Measurement 49% 53% 26% 26% 17% 14% 5% 4% 3% 3% Q1 2013 Q1 2014 In store pickup Fast shipping No sales tax Exclusive online deals Free shipping Among the services/factors listed below which can be provided by online retailers, please rate them on a scale of 1-5, where 1 is the most important factor to you, and 5 is the least important. Most online transactions now include free shipping, which is by far the most important online shopping factor among consumers Percentage of Respondents Selecting Each Factor as ‘Most Important’ for Online Shopping Source: comScore Custom Survey
  18. 18. © comScore, Inc. Proprietary. 18 Free Shipping is the new normal for the majority of top online retailers, but Amazon falls lower on the list due to 3rd party sales 99% 99% 99% 99% 99% 94% 93% 92% 84% 83% 76% 75% 71% 70% 58% 56% 53% 53% 13% 12% Percent of Transactions with Free Shipping in Q1 2014 Source: comScore e-Commerce Measurement
  19. 19. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Amazon Prime & Retailer Rewards Programs
  20. 20. © comScore, Inc. Proprietary. 20 Amazon Prime members (approximately 50% of Amazon sales) showed significantly higher dollars per transaction and per buyer $58 $41 Dollars per Transaction Prime Members Non-Prime Members $158 $131 Dollars per Buyer Amazon Prime and Non-Prime Members Average Spend - Q1 2014 Source: comScore e-Commerce Measurement
  21. 21. © comScore, Inc. Proprietary. 21 Amazon Prime buyers skew slightly older than non-Prime buyers, with more than half age 40 or older 4% 16% 19% 25% 17% 20% Prime Buyers 5% 21% 25%23% 15% 12% Non-Prime Buyers Prime and Non-Prime Members Age Demographics Q1 2014 Source: comScore e-Commerce Measurement
  22. 22. © comScore, Inc. Proprietary. 22 Among current users of Amazon Prime, most (77%) are satisfied with the program… 45% 32% 23%* % of Amazon Prime Users Overall Satisfaction with Amazon Prime (%Top-2 Box, 5-pt scale) Very Satisfied Somewhat Satisfied * - Net of: 14% Neither satisfied nor unsatisfied, 6% somewhat unsatisfied and 3% very unsatisfied Q. What are some of the reasons you joined Amazon Prime? Please select all that apply and identify the top reason. Source: comScore Custom Survey – April 2014 63% 15% 8% 5% 4% 6% Offered free 2-day shipping Unlimited instant streaming of movies and TV shows Special pricing on 1-day shipping Instant access to Kindle Books Can share membership with up to 4 people Other (please specify) Top Reason Respondents Joined Amazon Prime (% selecting each option as ‘top reason for joining Amazon Prime’) …and free shipping was the key factor for joining
  23. 23. © comScore, Inc. Proprietary. 23 Amazon Prime’s $20 price increase to $99/year does not seem to be deterring prospective users from considering membership programs 18% 20% % who would pay [Q4, $79] [Q1, $99] annually to join Amazon Prime (or similar program)* Q4 2013 Q1 2014 Impact of Amazon Prime Membership Fee Increase (Pre/Post – January/April) Source: comScore Surveys – January 2014 / April 2014 * - Among consumers NOT currently Amazon Prime members, who were willing to pay to join a rewards program
  24. 24. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Consumers’ Omnichannel Path to Purchase
  25. 25. © comScore, Inc. Proprietary. 25Source: comScore Survey – February 2014 Consumers were asked to rate a wide variety of shopping tools, including “traditional” (e.g. newspapers, TV) + digital/mobile tools “Traditional” Shopping Tools Digital Shopping Tools Mobile Shopping Tools • Direct mail • Magazines • Newspapers • Radio • Recommendations from friends and family • Television • Deal of the day sites • Digital coupons • Facebook • Online circulars • Online customer reviews/ratings • Online search engine • Printable shopping lists • Retailer or manufacturer email • Retailer website • Twitter • Mobile brand websites • Mobile coupons • Mobile location-based services • Mobile payments • Mobile retailer websites • Mobile search • Retailer smartphone app • Scannable QR codes • Text alerts from a retailer • Use of a smartphone in a physical store Shopping Tools Evaluated
  26. 26. © comScore, Inc. Proprietary. 26 Different tools for different purposes…and still a role for traditional media. Mobile coupons becomes the first mobile element in top-10 Overall Rankings for Each Tool, by Statement (Ranking among tools, % Top-2 Box, 7-pt scale) Source: comScore Survey – February 2014 “Saves Me Money” “Saves Me Time” “Helps Me With New Ideas” #1 Digital coupons Online search engine Online search engine #2 Online search engine Digital Coupons Retailer website #3 Retailer or manufacturer email Retailer website Recommendations from friends and family #4 Newspapers Online circular Television #5 Recommendations from friends and family Printable shopping lists Retailer or manufacturer email #6 Online circular Recommendations from friends and family Online customer reviews/ratings #7 Retailer website Retailer or manufacturer email Magazines #8 Deal of the day (e.g. Groupon) Online customer reviews/ratings Online circular #9 Direct mail Direct mail Direct mail #10 Online customer reviews/ratings Mobile coupons Digital coupons Denotes Traditional Media
  27. 27. © comScore, Inc. Proprietary. 27 2013 2014 Saves Me Money #17 #16 Saves Me Time #16 #14 Helps With New Ideas #21 #16 While mobile search has moved up in the rankings, it has yet to crack top-10 among shopping tools Top 2 Box Ranking for Importance of Mobile Search (+1) (+2) (+5)
  28. 28. © comScore, Inc. Proprietary. 28 Mobile coupon usage up 41% in the past year, with females age 18-44 34% more likely than average to take advantage of these deals. 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 Number of Mobile Coupon Users Among Smartphone Subscribers (000) Source: comScore MobiLens, U.S., Age 13+, Mar-2013 (3 Mo. Avg.) – Mar-2014 (3 Mo. Avg.) +41% Y/Y
  29. 29. © comScore, Inc. Proprietary. 29 Mobile phones have the highest search conversion rate in comparison to desktop computers and tablets 61% 78% 64% Desktop Mobile Phone Tablet % of Searches that Resulted in a Purchase Source: comScore custom research - 15miles/Neustar Localeze Local Search Usage Study Source: comScore 15Miles Neustar // Localeze 7th annual Local Search Study Did you make a purchase from the local business?
  30. 30. © comScore, Inc. Proprietary. 30 Mobile driving omnichannel commerce as 3 out of 4 mobile searches resulting in a purchase bring customers into brick-and-mortar stores Location of Purchase Source: comScore Custom Research – 15 miles/Neustar Localeze Local Search Usage Study 70% 73% 65% 17% 16% 15% 13% 11% 20% PC/Laptop Mobile Phone Tablet Purchased in store Called to make purchase Purchase online Source: comScore Local Search Usage Study Did you make a purchase from the local business? Online Called to make purchase In Store
  31. 31. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Mobile Commerce and the Multi-Platform Shopper
  32. 32. © comScore, Inc. Proprietary. 32Source: comScore MobiLens/TabLens 3 month average ending December Continued strength in adoption of smartphones and tablets has led to a dramatic shift in media engagement on these platforms 0 20,000,000 40,000,000 60,000,000 80,000,000 100,000,000 120,000,000 140,000,000 160,000,000 180,000,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 NumberofDeviceOwners 166 MILLION 89 MILLION Number of U.S. Smartphone and Tablet Owners Source: comScore MobiLens and TabLens, U.S., 2000-2013 +21% vs. YA +40% vs. YA 74% of the total online mobile population now own a smartphone, while 40% own a tablet
  33. 33. © comScore, Inc. Proprietary. 33 Mobile commerce, which reached $7.3 billion, accounted for nearly 12% of total digital dollars in Q1 1.8% 2.4% 3.6% 5.8% 6.6% 8.8% 9.0% 9.3% 8.1% 9.8% 11.3% 10.5% 8.6% 10.8% 11.7% 11.5% Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 m-Commerce Share of Total e-Commerce Dollars Source: comScore m-Commerce Measurement
  34. 34. © comScore, Inc. Proprietary. 34 In terms of discretionary spending, m-Commerce growth is still outpacing e-Commerce & bricks-and-mortar +1% +12% +23% +0% +5% +10% +15% +20% +25% Total Discretionary Retail E-Commerce M-Commerce Q1 2014 Y/Y Retail Spending Growth by Channel Source: Dept. of Commerce, comScore e-Commerce & m-Commerce Measurement
  35. 35. © comScore, Inc. Proprietary. 35 While categories such as computer hardware still lean heavily to desktop, digital content and video games skew toward mobile Q1 2014 Share of Product Category Digital Commerce Spending by Platform for Selected Categories Source: comScore e-Commerce & m-Commerce Measurement 89% 74% 77% 89% 89% 89% 91% 92% 94% 7% 15% 19% 6% 7% 8% 3% 3% 4% 4% 11% 3% 5% 4% 3% 6% 5% 3% 60% 65% 70% 75% 80% 85% 90% 95% 100% Total Non-travel Digital Content Video Games Apparel & Accessories Toys & Hobbies Consumer Electronics Home & Garden Furniture & Appliances Computer Hardware Desktop Smartphone Tablet
  36. 36. © comScore, Inc. Proprietary. 36 Mobile has become the primary medium for consumers to engage with retail brands online 0 5,000 10,000 15,000 20,000 25,000 30,000 Desktop Smartphone Tablet Total Minutes (MM) Spent in Retail Category by Platform Source: comScore Media Metrix and Mobile Metrix, U.S., Feb-2013 – Mar 2014 47% 38% 37% 43% 15% 19% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Mar-2013 Mar-2014 Desktop Smartphone Tablet
  37. 37. © comScore, Inc. Proprietary. 37 Several leading retailers seeing rapid growth in their number of mobile-only visitors, highlighting the importance of mobile storefronts 0 10,000 20,000 30,000 40,000 50,000 60,000 Amazon eBay Target Wal-Mart Best Buy Selected Top Retailers: Trend in Mobile-Only Unique Visitors (000) Source: comScore Media Metrix Multi-Platform, U.S., Mar-2013 – Mar-2014 +32% +88% +56% +36% +23%
  38. 38. © comScore, Inc. Proprietary. 38 Mobile-only traffic in the retail category skews heavily towards younger consumers. Nearly 1 out of 3 18-24 year olds are mobile-only shoppers. 29% 19% 13% 9% 9% 6% 49% 65% 69% 63% 66% 27% 22% 16% 18% 28% 25% 68% 0% 20% 40% 60% 80% 100% Age 18-24 Age 25-34 Age 35-44 Age 45-54 Age 55-64 Age 65+ Mobile Only Multi-Platform Desktop Only Percent Platform Composition by Age Segment in Retail Category Source: comScore Media Metrix Multi-Platform, U.S., Age 18+, Mar-2014
  39. 39. © comScore, Inc. Proprietary. 39 0 50,000 100,000 150,000 Amazon Sites eBay Apple.com Sites Wal-Mart Target Corp. Best Buy Sites Sears.com Etsy.com The Home Depot Macy's PC Only PC + Mobile Mobile Only A significant percentage of top retailers’ audiences are multi-platform & mobile-only; but wide variation among mobile app vs. browser splits Selected Leading Retailers: Total U.S. Digital Population Unique Visitors (000) by Platform Source: comScore Media Metrix Multi-Platform, U.S., March 2014 164M 104M 90M 56M 44M 25M 21M 21M 20M 18M 29% 29% <1% 76% 26% 89% 78% 64% 84% 83% 71% 71% 99% 24% 74% 11% 22% 36% 16% 17% Browser App % of Time Spent – Browser vs. App Source: comScore Mobile Metrix, U.S., March 2014 Mobile = Smartphone + Tablet Mobile app usage for Apple.com Sites includes all Apple property apps (e.g. iTunes, Apple Maps, etc.) Apple Sites
  40. 40. © comScore, Inc. Proprietary. 40 Apps done right: Target hit a home run with Cartwheel rollout as evidenced by huge gains in mobile app usage % of Time Spent on Target Mobile – Browser vs. App Source: comScore Mobile Metrix, U.S., Sept 2013 / March 2014 79% 26% 21% 74% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% "Sep 2013" "Mar 2014" App Browser
  41. 41. © comScore, Inc. Proprietary. 41 Target’s mobile usage is up 251% y/y, with Cartwheel accounting for 80% of the total increase in time spent via mobile Total Minutes (000) Spent via Target Mobile Apps Source: comScore Mobile Metrix, U.S., March 2014 0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 Target.com Website Cartwheel (Mobile App) Target (Mobile App) +251%
  42. 42. © comScore, Inc. Proprietary. 42 73% 50% 24% 18% 18% 2% Price was better online Planned to buy online but wanted to see item(s) in person before ordering Item was out of stock at store Would rather have item(s) shipped to home than take home with me Was not convenient to buy in-person at the time Other % among those who engaged in 'showrooming' ‘Pre-meditated showrooming’ on the rise (+8 pts vs. Q4 2013), but price remains the primary motivator for showrooming behavior Why Consumers Are ‘Showrooming’ Q. Which of the following describe why you utilized showrooming? (Please select all that apply) Source: comScore Custom Survey – April 2014
  43. 43. © comScore, Inc. Proprietary. 43 While overall, 35% of online consumers have utilized ‘showrooming,’ this behavior varies significantly across key demographics… 37% 34% % who have showroomed Men Women 29% 38% 40% % who have showroomed Under 50k 50-100k 100k+ 47% 46% 41% 36% 29% 28% % who have showroomed 18 to 24 25 to 34 35 to 44 45 to 54 55 to 64 65 or older 35%of all respondents 55% 41% 22% % who have showroomed Heavy online shopper* Medium online shopper* Light online shopper* * Heavy online shopper: shops online 2 or more times a week * Medium online shopper: shops online once a week or a few times a month * Light online shopper: shops online once a month or less Gender Income Age Shopper Type
  44. 44. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Social Commerce
  45. 45. © comScore, Inc. Proprietary. 45 Social media users spend 31% more than average online, and Pinterest users spend nearly 2x the norm E-Commerce Buying Power Index for Selected Leading Social Platforms Source: comScore Media Metrix, U.S., March 2014 131 139 167 194 50 100 150 200 250 Social Networking Facebook Twitter Pinterest
  46. 46. © comScore, Inc. Proprietary. 46 Facebook remains an important advertising channel for retailers that drives both brand awareness and click-through referral Top Retail Display Advertisers on Facebook by Display Ad Impressions (000) Source: comScore Ad Metrix, U.S., Q1 2014 3,000,441 1,729,925 903,049 747,396 731,924 554,077 520,920 439,962 418,836 390,851 Netflix, Inc. Amazon.com Wayfair LLC 1-800-Flowers.com Overstock.com Macy's, Inc. JustFabulous Nordstrom, Inc. Gap, Inc. Luxottica Group 59% 31% 51% 53% 80% 51% 18% 62% 47% 53% 41% 69% 49% 47% 20% 49% 82% 38% 53% 47% Facebook’s Share of Retailer Total Display Ads Source: comScore Ad Metrix, U.S., Q1 2014
  47. 47. © comScore, Inc. Proprietary. 47 Is Pinterest ready to take a bigger slice of the social commerce pie? Paid ads via ‘Promoted Pins’ could prove highly effective for retailers.
  48. 48. © comScore, Inc. Proprietary. 48 Pinterest is gaining influence as a social commerce channel, but usage continues to shift heavily toward mobile 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 Desktop Mobile Pinterest Total Unique Visitors (000) by Platform Source: comScore Media Metrix and Mobile Metrix, U.S., Jul-2012 – Mar-2014
  49. 49. © comScore, Inc. Proprietary. 49 Why else should retailers care about Pinterest? Ability to generate very high reach among strategic demo segments like Females 18-49 12% 21% 22% 20% 37% 43% Desktop Mobile Total Digital Population Total Audience Females Age 18-49 Pinterest: % Reach Among Total and F18-49 Populations by Platform Source: Media Metrix Multi-Platform, U.S., Feb 2014
  50. 50. © comScore, Inc. Proprietary. 50 Other attempts at social commerce include Amazon and Twitter partnering to easily add items to your #AmazonCart
  51. 51. © comScore, Inc. Proprietary.© comScore, Inc. Proprietary. Key Takeaways
  52. 52. © comScore, Inc. Proprietary. 52 Key Takeaways • Q1 2014 Total Digital Commerce accelerated marginally to 13% y/y as it continued to gain share from brick-and-mortar • Desktop e-commerce grew 12%, while mobile commerce grew 23% • Digital commerce grew by 1 percentage point vs. Q4 and picked up the slack from brick-and-mortar, which softened during the quarter in part due to a cold and snowy winter • Consumer sentiment continues to improve, but price sensitivity still a major driver of e-Commerce behavior • Negative economic sentiment hit an all-time low in the comScore survey, improving 5 points vs. Q4, but economic concerns remain for 35% of the online population • Free shipping continues to gain in importance, hitting an all-time non-Q4 high in Q1 at 58% • Amazon Prime is popular and drives higher purchase rates, but free 2-day shipping may be less of a motivator than many think • Mobile & Social Commerce are becoming more significant factors in shopping and buying behavior • Mobile is driving 12% of total e-commerce dollars today; growing at 2x the rate of desktop • Mobile is now the wide majority of time spent in the Retail category • Mobile searches are influential in driving in-store purchase • Pinterest is poised to become a very important marketing and advertising channel for retailers so it's time to start paying attention
  53. 53. © comScore, Inc. Proprietary. www.comscore.com www.facebook.com/comscoreinc @comScore Please contact us at learnmore@comscore.com if you have any additional questions or comments. Questions?
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