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Online Shoppers Aren't Impulsive
Rollie Hawk writes "When it comes to online shoppers, conventional wisdom has long been divided. Some have argued that the instant nature of shopping from home over the Internet leads to quick purchases while others have contended that easy price comparisons on the Web allow buyers to do more research first. For now, it looks like the latter camp is closer to the truth.
According to a press release by ScanAlert, online shoppers are more frugal than many retailers previously thought. According to their testing, 35% take more than 12 hours to make a purchase, 21% take more than three days, and 14% take more than a week. On the average, online shoppers take 19 hours to make a purchase after the initial visit.
This has some important marketing ramifications according to ScanAlert CEO Ken Leonard. "The implication to merchants is that the shopping cart is not just a convenience factor. It must be a comfort zone to shoppers. These results were not expected."
In the press release, Leonard advised online sellers that "consumers abandon shopping carts with an ease that frustrates and often confuses online retailers. Retailers must understand, however, that almost half of all online purchases are from shoppers who leave a site after the first visit, and return -- even days later -- to buy.""
This makes sense. When I worked at a phone answering job where I took orders, a lot of people would call up ask for information then hang up to order it on line. People use the Internet to order at their convenience rather than at the convenience of the seller.
I find that buying online is less impulsive because you have mountains of research to rely on.
Lets say I see (hmmm we're on Slashdot so I'll use the computer hardware example) a new component for my rig that I absolutely must have. I'll go through many reviews first to make sure it functions, is compatible, is priced correctly, and will be a good buy.
Now lets say I'm at the supermarket deciding between the S&S brand and a gourmet brand of food. No external input for consumption, so its more likely I'll buy the gourmet on the spot.
I'd say from initial liking to final purchase takes me nearly 36 hours.
I know that whenever I hit Amazon, I have something very specific in mind that I'm looking for that I couldn't find at a brick-and-morter. In fact, any time a BM tells me they have to special order it, I hit Amazon. I think a lot of people shop this way.
Its the same for other web. People who search for products on the web are usually looking for something specific. This is, in my opinion, one reason why click through ads don't work. Most clicks I find totally irrelevant. Actually, in 10 years I've never voluntarily followed a banner ad.
Seems I turn to the web more and more these days to find specialty items I know the warehouse BMs won't carry. I buy classical musically exclusively through Amazon because most of the smaller specialty retailers in my city have been put out of business by the WalMart/Costco style mega stores.
A few years back, there were 3 classical music CD shops around. A big megachain opened, and they dedicated an entire floor to classical and lowballed all prices trying to get the volume sale. These 3 independants went under, and shortly after that, the megachain closed down/vented their classical section.
Prolly off topic but it still bugs me.
/\/\icro/\/\uncher
Amazon.com makes it so easy to order stuff that it's dangerous to your credit card. Every once in a while I'll get on there and splurge. No filling out name, address, or credit card details. No logging in at all. They have a nice system.
I did 90% of my Christmas shopping there last year. Take that, parking lots! Take that, crowds of shoppers!
It's less effort to fill up a virtual shopping cart, and there's no issue with just walking away from it. Nothing says I can't pull a hundred items off the shelf at Safeway and then leave my cart in the isle, but it'll get me looked at funny and I'd feel guilty about making the staff restock everything. I have no qualms with wasting the time of a computer, though. So yeah, surprise surprise, the virtual metaphor ain't like the real thing.
I think a good part of this is exactly that: You can't examine the object first-hand.
Another part may be, as hinted at in TFA, easier price comparisons. I know I visit several websites looking at prices before I even put serious thought into buying it. ("Do I really need it?", etc)
There also might be a reluctance to buy things online in general, either because they are concerned about hassles of returning items, damage during shipping, or sending their credit card info into cyberspace.
What I would like to see is how many people do shopping on the internet, then try visiting local stores looking for the same product or comparable, and how many buy from a local store versus how many come back to the website to buy.
=Smidge=
This is where sites like Amazon that have a "save for later" feature for shopping carts are trumping other sites that only have minimal e-commerce functionality. If a customer isn't ready to buy, but can save an interesting item for easy access later, they will be more likely to come back to that merchant and make the purchase if the price is reasonable. In addition, the convenience of not having to root through the site to find the item again will improve the standing of the site in the eyes of the consumer, causing them to come back the next time they're interested in buying something.
Honestly, it surprises me that online merchants are surprised with how consumers ditch their shopping cart contents so often, in light of the fact that Amazon has had "save for later" functionality for years now, a feature that was probably added when they realized that their customers didn't always place an order right away.
On a side note, I like to keep one or two paperback books in my saved cart on Amazon so that when I order a DVD that's under $25, I can add the book and get free shipping.
1) I am just window shopping
2) I'm trying the site out for convenience
3) I'm trying the site out on behalf of someone else, and will give them a recommendation
4) I'm using the shopping-cart to get information I can't get any other way, such as shipping costs, or to generate a total bill
For big items, I rarely buy the first time I go to an online shop.
If I've never heard of the store before, I typically won't shop there until I get comfortable with it, that includes trying out the shopping cart, reading all the terms, and searching the net for comments good or bad. Exceptions include hard to find items, I won't research the store as much for those, since it's unlikely I'll find a plethora of other stores to shop at if the store doesn't meet my normal standards.
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
A few years ago, outpost.com (and many other sites) had free overnight shipping and no sales tax. I could get an item almost as quickly as I could by going to the store, and usually get it cheaper too. Impulse buying was pretty easy.
Now, I usually let a bunch of items accumulate in my shopping cart at a site and then order so that I can save on shipping costs, and I don't usually bother with the fast shipping options. No more online impulse buying for me - except for songs from the iTunes store.
I can understand that on-line sellers may get frustrated from people abandoning shopping carts, but I can think of many reasons, not just price shopping.
/rant
First of all, I think an on-line shopping cart is more analogue to simply shopping; picking something up and putting it back down. Most real stores don't have shopping carts. But if they did, and especially if it wasn't considered rude, I think you'd see much more people putting stuff in their car and abandoning their shopping cart when they left the store.
Then there's the issue of availability of other products. For example, I start of at Jameco and find most of the stuff I need, but then my luck runs out. So I go to DigiKey. They turn out to have everything. If there's a few dollars price difference I don't care, I'd rather order from one shop.
Then there's the payment method. If a site supports PayPal, then I favor them, because I don't have to provide them with my CC details. I like that. Or if none of the candidates supports PayPal, I'd look which one is more reputable. Here's a hint for on-line store owners: provide goddam address information and telephone numbers. If you are trying to hide behind the anonimity of the intarweb, then why the hell would I give you my CC number?
Now, what I get frustrated with is how little you still _can_ buy online. I have needed to order a wild variety of things lately, and as soon as you step out of the blatently obvious products, you sometimes hit a brick wall. I mean, if you don't have the infrastructure to deal with on-line sales, let someone else handle it. There's plenty of companies that are more than happy to do it for you.
I wonder if they have any idea how much business they lose by having the 'call to talk with sales' statement.
First, note that this says of those who do make a purchase, almost half have gone away and come back to finish the transaction. It doesn't say that half of all people who go away will come back.
Second, they're leaving out the fact that for many sites, putting something in your shopping cart is required in order to shop. You can't check a price at many sites without using their shopping cart.
Contrary to what ScanAlert says ("Digital window-shopping is very popular among online shoppers..."), I think most people don't "window shop" in the traditional sense of taking inventory of what's out there.
A lot of the time online shoppers (Ok, I) do initial investigation, get ready to buy something, and then go check elsewhere. Since many online prices are in a similar range, it's often easier to simply complete the first transaction rather than wade through another online store.
Plus, we all have our favorite, habitual, or default online retailers.
It may be a distinction without a difference, but I think there is a sharp contrast in purchase behavior between someone hunting down a better deal (comparison shopping) and someone seeing what is out there (window shopping).
sigs, as if you care.
How do these numbers compare to in store purchasing habits?
Setting aside the difficulty of measuring these kinds of things, this study doesn't say anything about whether or not online purchasers are more impulsive than brick-mortar purchasers unless there's some sort of actual, quantitative comparison.
That said, anecdotally, I don't doubt that people are less impulsive online. When I go shopping in a physical store, I generally know what I want already and I've already done my research, but I'm much more tempted to buy something on display on a whim. Worse, because of the physical labor involved, I generally don't walk around the mall comparing prices. Online, on the other hand, I'll take weeks making a purchase in order to get the best deal and even though it's really easy to put other things in my basket, I don't find it to be nearly as tempting.
The exception to this is iTunes. There, I'm much more impulsive. "OOoh, 80's song I haven't heard in 20 years... (click)"
Humorless sig goes here.
"consumers abandon shopping carts with an ease that frustrates and often confuses online retailers"
Consumers abandon shopping carts? What about when I spend an hour shopping, have to go away for a day or so, and when I come back, my shopping cart has been deleted on the server-side? Now THAT's frustrating!
For me it's the shipping that keeps me from being impulsive online. I can't just buy something and have it in my hands instantly...I have to wait a few days to actually see it, and I know that during this time I'm pretty likely that the thrill could wear off, so I resist pretty easily. At the store it's completely different... being impulsive means instant gratification.
:)
Price comparison and research is definately a factor as well, but it can also be a real pain. I know there have been many times where I've spent several hours searching around just to save a couple bucks. Or I'll waste hours reading contradicting reviews. Sometimes by the time I've found the right product I just don't give a rip anymore
I think a lot of sellers are discovering that price and professionalism are two of the biggest reasons a buyer buys from them as opposed to somebody else. If your operation looks like it's a fly-by-night thing, you might get a few brave/stupid customers, but most will avoid you like the plague.
Free MacMini
Personally, if I can't determine the exact shipping cost before I give my name and address (and maybe even my credit card number), then I go elsewhere.
If the site sets an over priced shipping cost for each item and just adds the shipping costs together if multiple items are bought (greatly inflating prices from the actual shipping cost), I'm inclined to not buy from them at all, but certainly I will not be buying a lot.
Because buyers do shop, it is extremely helpful for both buyer and seller to have real time inventory information posted on the website and actually show the buyer how many of an item are available. More than once a vendor has lost a complete sale when I saw an item I wanted but waited until I could order some other items also, had put several items in my "cart", and then gone to add the item that I really wanted and that had induced me to buy from them, only to find that it was no longer in stock. Had I been able to see inventory numbers I might have known it was selling out and bought faster, instead I just dropped my entire combined order. Even worse are vendors who you can't tell if the item is in stock or not from an on-line website in this computer age.
The seller who charges actual shipping costs, or even actual shipping costs plus a buck or two for costs like the box, if far more likely to gey my business and repeat business than the seller who looks at shipping as a profit center.
Sellers who play games with shipping costs by greatly varying them for very similar size and weight items (you know who you are, Newegg) actually discourage a lot of sales. Why it costs $2.99 to ship some pcmcia cards, even $1.00 to ship some, but $5 to ship others that are on the same size box and of the same weight makes no sense at all (and even less sense if I want to buy 4 and the shipping jumps to %20).
I'm an American. I love this country and the freedoms that we used to have.
You have captured the truth perfectly.
So, since you have this figured out so well, I've got a question for you. How do we get online sellers to see this kind of information and improve the whole online shopping experience?
I remember what I thought was the best virtual cart... remember homegrocer.com? The cart was a live, updatable frame that was always visible and continually changed and updated, including tax (shipping and handling were NA) and easy to add/remove with a simple button click on each item. Not only that, but the items were sorted in a logical order, not just in the order you added them.
The whole point is that the cart is not an order until you hit check out. Then it becomes a purchase order to be filled. If online stores were to only give all this information up front, they would find it easy to see how many people were just 'browsing' and how many ran away at the last minute.
Okay, I am an anti socialite, and like to shop from home, so I think I am a qualified voice here. Define impulsive- I buy things I didn't plan on, but usually in addition to what I have been researching, for example a carrying case for what I am buying... I often abandon my shopping cart when I see exorbitant shipping charges. Other times I get put things in shopping cart just to "bookmark them" while I poke around. The important thing I think, is to have the shopping carts still full when you log back onto the site a week later. Then you can quick pull the buying trigger without refilling the cart. You must make it easy to shop- I can't count the number of times I leave a site because it is hard to navigate. (I dont want a pretty flash site, I want a quick loading easy to use site...) In order to succeed online, I thing you must have free shipping- stores can pay for the shipping with the savings from overheard of not having to have a retail outlet.
Almost every Harvard student was High School Valedictorian- After a year of college, half are in the bottom of the class
I abandoned two shopping carts yesterday. Why? Because the losers designing the websites forced me to click all the way through to the last confirmation page before telling me the shipping costs. And one of those sites was Amazon , a site that supposedly offers free shipping if you spend more than $25. But there are so many loopholes in their offer that the only way to find out the shipping cost is to click through and then abandoning the shopping cart.
I bet 80% of the abandoned carts would never appear if the sites didn't jerk you around and force you to "check out" to check out the shipping prices.
I'm pretty sure a MAP constitutes a fair and free trade rule of law. In fact, I seem to recall a price fixing lawsuit wherein the record industry was setting an advertised price floor, which was enforced by tying the rule to an advertising fee which offsets the retailer costs of printing circulars. In the end, the industry settled, promised not to do so again, and admitted no wrongdoing. In other words, the DA got a win, some buerocrat gets a job distributing the wealth to libraries (and subsequently get in trouble for refusing to distribute copkiller albums), the record company has to find a new way to accomplish the same goal, while the average consumer gets MAYBE a five dollar coupon off their next purchase.
A Minimum Advertised Price is stupid, anticompetitive and hurts both the retailers selling products and the consumers buying them.
I Browse at +4 Flamebait
Open Source Sysadmin
If walked out on stores a number of times. I normally only have a few items when I do it, so the cost isn't that large.
One time, they had two registers open and the one I was in was slow (a dickering customer and then a price check), so I turned to the other register and she said she was closed. I walked out without a word.
If you stay when you are mistreated and still buy from the store just because it is easy, you're the sheep who let it happen.
Common sense reasons why online shopping would inspire fewer impulsive purchases:
1. Even with a high speed connection buying anything online is a very deliberate act. You have to be determined. You have to look up a url and go through multiple screens. If you are in this frame of mind you have pretty much decided what you want ( & don't ) want to buy.
2. You have to take trouble to physically go to a brick-n-mortar store. Hence the mentality to load up while you are there. Your PC/Mac is always there so if you are unsure about a purchase you always bag it and come back later.
3. Impulse buys happen in checkout lines where you are forced to wait and stare at the impulse item they want you to buy. Not so on the web, and if they tried the customer would perceive an enforced wait or redirect as an intrusion and bag the purchase.
Hardly. Take the case of Newegg. The same type of item (pcmcia cards) can range in shipping cost from free to $5 per item, and if you buy several they just multiply the cost times the number you buy. But you can see the shipping cost based on which item you buy before you ever give them a destination address! In other words, the person in California pays the same shipping cost as the person in New York or North Carolina or any other state (at least of the 48 connected ones). So in this case where the item is being shipped to has no impact at all on the shipping cost, since they don't know where it is being shipped to when they quote you a fixed shipping price.
I'm an American. I love this country and the freedoms that we used to have.
Speaking as an on-line store player, MAPs are a tremendous pain. We http://theboyz.biz/ don't sell much Garmin, for example, even though we can often beat others prices on it.
The reason? We're not allowed to _advertise_ that our prices are lower. That's means the Froogle feed, as well as any robots, must also see the MAP price. Even if you could get your site to display "$20 or less", all the robots would simply spot $20, and ignore the rest.
And much on-line shopping is search-engine driven.
It would not be *nearly* as frustrating if it wasn't trivial to go Froogle prices that are higher than ours - but lower than what we can advertise.
We also show the real price after you add the product to your shopping cart (blocked via robots.txt for crawlers). But then again, we have a shipping cost preview from the shopping cart, too -- I *hate* having to fill out all kinds of stuff just to find out that shipping is a ripoff.
If you're not living on the edge, you're just taking up space!