Tuesday, February 12, 2008

US Online Buyers Spend Less Offline

FEBRUARY 12, 2008

In-store spending still dominates retail.
More than two-thirds of US online buyers who participated in the USC Annenberg Center for the Digital Future's study in 2007 said that their Web purchasing reduced their retail store purchases, up from the 65% who said so in 2006.

That does not mean that online buyers always avoid making purchases offline.

Web buyers spent an average of $511 in stores compared with $313 online in a three-month period during Fall 2007, according to Forrester Research "Retail Channel Surfers Prefer to Buy Offline" report, as cited in Internet Retailer.

But online was far ahead of other channels such as catalog, phone and TV shopping.

Web merchants are getting better at retailing physical products on their sites, and product information is now available at review, social networking and other sites, which helps explain why buying goods online has become so popular.

Different purchasing channels have traditionally offered different benefits, as detailed in the e-tailing group's "2006 Transformed Multi-Channel Shopper" report, conducted with J.C. Williams Group and StartSampling. Consumers surveyed expressed a preference for stores for the social experiences available, and catalogs for portability.

Yet social shopping sites bring a social experience to Web shopping, and the popularity of laptop PCs has made retail e-commerce a more portable experience.

This is all straightforward good news for pure-play online retailers. But multi-channel retailers face a question: if buying online reduces in-store purchases, how exactly should the two channels work together for consumers?

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