Table of Contents
Scope and Themes
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- What you need to know
- Definition
- Data sources
- Sales data
- Consumer survey data
- Advertising creative
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- E-commerce still grows in recession
- Electronics the most resilient product category
- Consumers warm to e-commerce and value its convenience
- Sales tax advantage in jeopardy
- Amazon leads e-commerce with strong value propositions
- Other major retailer brands strategize to catch Amazon
- Retailers increase focus on lead generation
- Television ads push lifestyle, gifting
- E-commerce adoption skews with gender, age, and household income
- Key demographic for e-commerce: 25-34-year-olds
- Decreased concern over using personal information to make purchases
- Price comparison users are fragmented among multiple sites
- Mobile shopping still in infancy
- Developers innovate as smartphone penetration rises
Inspire Insights
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- Transparency
- What's it about?
- What we've seen
- Specifics
- Impact: Personalization and targeting require consumers to share
- Over-Optioned Consumers
- What's it about?
- What we've seen
- Impact
Insights and Opportunities
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- Over-55s
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- Figure 1: Popularity of online retailers, by age, March 2010
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- Figure 2: Usage of checkout services, by age, March 2010
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- Figure 3: Internet usage, by age, May 2008 and April 2009
- Convenience, the long-term focus
- Mega-retailers to evolve into product search engines
Market Size and Forecast
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- Market still growing through recession
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- Figure 4: Total U.S. e-commerce retail sales, 2004-14
- Figure 5: Total U.S. e-commerce retail sales, at inflation-adjusted prices*, 2004-14
Competitive Context
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- Key points
- Online share growing but adoption may see a plateau
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- Figure 6: E-commerce sales as a percentage of total retail, 2001-10
- Web-only retailers growing faster than retail chain web sales
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- Figure 7: Online sales of top 500 sites, by type of retailer, 2007 and 2009
- Decreasing interest in wish lists, but interest in gift cards on the rise
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- Figure 8: Attitudes toward online gift shopping, February 2009 and March 2010
Segment Performance
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- Key points
- Electronics, recorded entertainment, toys post large gains in recession
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- Figure 9: U.S. e-commerce sales at electronic shopping/mail order houses, by type of merchandise, 2007 and 2008
- E-shoppers make purchases in fewer categories in 2009
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- Figure 10: Categories of internet purchase, 2006-09
Leading Retailers
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- Key points
- Amazon far in the lead
- Lower prices
- Shipping charges
- Widest selection of products
- Convenience
- Staples outperforms with a focus on small business customers
- Walmart takes aim at Amazon with aggressive pricing
- Apple’s web traffic pushes it to fourth place
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- Figure 11: Sales and related statistics of top ten internet retailers, 2009
- Amazon receives monthly business from a third of e-shoppers
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- Figure 12: Popularity of online retailers, March 2010
- Youngest respondents 18-24 show greater skew toward Amazon and eBay
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- Figure 13: Popularity of online retailers, by age, March 2010
- Value-oriented brands see lower traffic from $100K+ respondents
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- Figure 14: Popularity of online retailers, by household income, March 2010
- eBay rebrands as fixed-price vendor of new merchandise
Innovation and Innovators
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- Mobile app developers innovate as smartphone penetration rises
- Hardware
- Software
- Conversion rates improved through personalized site navigation
- Overstock promotes local business
- Social shopping sites target women who share trends
- Other social sites harness the power of group buying
Television Advertising
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- Top e-commerce brands place emphasis on customer lifestyles
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- Figure 15: Amazon—Diverse Customers, December 2009
- Figure 16: eBay—Chevy Motors, August 2009
- General merchandiser sites incorporate theme of gift giving
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- Figure 17: Zappos—Gift Exchange, March 2010
- Figure 18: Overstock—Dad Knows Best, May 2010
- Vendors of groceries and apparel reach out to family demographic
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- Figure 19: Peapod—Frantic Family, March 2010
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- Figure 20: JCPenney—Kids Matter, August 2009
Online Promotion
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- Key points
- Web retailers rely on lead generation for traffic
- Price-comparison sites
- Search engines
- Improved targeting helps display ads make a comeback
- Targeting improves through tracking web behavior
- More respondents across the board click on display ads
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- Figure 21: Clicking on internet ads, by various demographic factors, February 2009 and March 2010
- Limited appetite for social network marketing
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- Figure 22: Attitudes toward online promotions and coupons, March 2010
Market Drivers
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- Consumer confidence undermined by high unemployment and foreclosures
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- Figure 23: Consumer confidence and U.S. unemployment rate, January 2008-May 2010
- Decline in revolving credit puts pressure on consumer expenditures
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- Figure 24: Outstanding consumer credit, January 2008-May 2010
- Convenience is internet’s top value proposition
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- Figure 25: Motivations behind online shopping, March 2010
- Consumers warm to e-commerce for broader range of purchases
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- Figure 26: Barriers to online purchase, February 2009 and March 2010
- Free shipping encourages more regular purchases
- States move to collect sales tax on online purchases
- Broadband access
- Smartphone ownership
Usage
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- Key points
- Recession stalls growth of online consumer base in 2009
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- Figure 27: Incidence of internet purchase, 2006-09
- Penetration skews female, younger, and higher income
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- Figure 28: Incidence of internet purchase, by various demographic factors, 2008 and 2009
- Online spending is both routine and significant in dollar amount
- Convenience of internet also facilitates in-person purchases
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- Figure 29: Type and frequency of purchases made, March 2010
- Key demographic for e-commerce: 25-34-year-olds
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- Figure 30: Type and frequency of purchases made, by age, March 2010
Motivations
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- Key points
- Price savings, lack of local availability decline in importance
- Convenience central driver
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- Figure 31: Motivations behind online shopping, February 2009 and March 2010
- Convenience more important than low prices for over-35s
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- Figure 32: Motivations behind online shopping, by age, March 2010
- Female-oriented sites would benefit from wish lists and wide selection
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- Figure 33: Motivations behind online shopping, by gender, March 2010
Reasons Not to Shop Online
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- Key points
- Key reasons for not shopping online not diminished
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- Figure 34: Reasons not to shop online, February 2009 and March 2010
- Shipping charges more likely to deter women
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- Figure 35: Reasons not to shop online, by gender, March 2010
- Older shoppers more resistant to purchasing remotely and shipping fees
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- Figure 36: Reasons not to shop online, by age, March 2010
- Lower-income respondents may be less willing to take online risk
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- Figure 37: Reasons not to shop online, by household income, March 2010
Comfort with Online Shopping
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- Key points
- Increasing comfort with online shopping leading to more purchases
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- Figure 38: Comfort with online shopping, February 2009 and March 2010
- Under-35s more concerned about delivery times
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- Figure 39: Comfort with online shopping, by age, March 2010
- Highest earners more willing to try unfamiliar web stores
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- Figure 40: Comfort with online shopping, by household income, March 2010
Role of Online Reviews
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- Reviews represent a strategic draw
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- Figure 41: Attitudes toward online product feedback, by household income, March 2010
Mobile Shopping
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- Key points
- Mobile shopping still limited to early adopters
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- Figure 42: Attitudes toward mobile shopping, March 2010
- 25-34-year-olds, higher earners most likely to use phones for shopping
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- Figure 43: Attitudes toward mobile shopping, by age, March 2010
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- Figure 44: Attitudes toward mobile shopping, by household income, March 2010
Price-comparison Sites
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- Key points
- Price comparison users are fragmented among multiple sites
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- Figure 45: Popularity of price-comparison sites, March 2010
- Men more likely to use price-comparison sites
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- Figure 46: Popularity of price-comparison sites, by gender, March 2010
- 25-34-year-olds are key demographic for price-comparison sites
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- Figure 47: Popularity of price-comparison sites, by age, March 2010
- Higher-income household members sophisticated at price comparison
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- Figure 48: Popularity of price-comparison sites, by household income, March 2010
Checkout Services
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- Online payment usage follows from frequency of purchase
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- Figure 49: Usage of checkout services, by gender and age, March 2010
- PayPal remains dominant provider of checkout services
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- Figure 50: Popularity of checkout services, by age, March 2010
Race and Hispanic Origin
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- Key points
- Skew in online adoption strongly linked to income disparity
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- Figure 51: Incidence of internet purchase, by race/Hispanic origin, 2009
- Asians early adopters but financially risk-averse
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- Figure 52: Comfort with online shopping, by race/Hispanic origin, March 2010
- Online Asians and Hispanics more likely users of price-comparison sites
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- Figure 53: Popularity of price-comparison sites, by race/Hispanic origin, March 2010
- Asian respondents more active in searching for online coupons
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- Figure 54: Attitudes toward online promotions and coupons, by race/Hispanic origin, March 2010
- Asians and Hispanics more likely to adopt cell phone commerce
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- Figure 55: Attitudes toward mobile shopping, by race/Hispanic origin, March 2010
Cluster Analysis
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- Incidentalists
- Demographics
- Characteristics
- Opportunity
- Intentionals
- Demographics
- Characteristics
- Opportunity
- Demographics
- Characteristics
- Opportunity
- Cluster characteristics
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- Figure 56: Online shopping clusters, March 2010
- Figure 57: Attitudes and behavior toward online shopping, by online shopping clusters, March 2010
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- Figure 58: Attitudes toward online coupons, by online shopping clusters, March 2010
- Figure 59: Attitudes toward online wish lists, by online shopping clusters, March 2010
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- Figure 60: Comfort with online shopping, by online shopping clusters, March 2010
- Figure 61: Use of checkout services, by online shopping clusters, March 2010
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- Figure 62: Use of online feedback and reviews, by online shopping clusters, March 2010
- Figure 63: Interest in cell phone shopping, by online shopping clusters, March 2010
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- Figure 64: Motivations for shopping online, by online shopping clusters, March 2010
- Cluster demographics
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- Figure 65: Online shopping clusters, by gender, March 2010
- Figure 66: Online shopping clusters, by age, March 2010
- Figure 67: Online shopping clusters, by household income, March 2010
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- Figure 68: Online shopping clusters, by race, March 2010
- Figure 69: Online shopping clusters, by Hispanic origin, March 2010
- Cluster methodology
Custom Consumer Groups
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- Gender and age
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- Figure 70: Type and frequency of purchases made, by gender and age, March 2010
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- Figure 71: Motivations behind online shopping, by gender and age, March 2010
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- Figure 72: Reasons not to shop online, by gender and age, March 2010
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- Figure 73: Selected attitudes toward online shopping, by gender and age, March 2010
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- Figure 74: Attitudes toward mobile shopping, by gender and age, March 2010
Appendix: Other Useful Consumer Tables
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- Motivations
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- Figure 75: Motivations behind online shopping, by household income, March 2010
- Comfort with online shopping
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- Figure 76: Comfort with online shopping, by gender, March 2010
- Popularity of online retailers
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- Figure 77: Popularity of online retailers, by gender, March 2010
- Shopping with cell phones
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- Figure 78: Attitudes toward shopping with cell phones, by gender, March 2010
- Checkout services
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- Figure 79: Use of checkout services, by household income, March 2010
Appendix: Trade Associations
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