How Influential Is The Internet In A Consumers Buying Process?

According to a Pew Internet & American Life Project (2005) survey, 70.6% of households with incomes of $75K or more say the Internet is their primary source of information when evaluating and comparing products

Online Activities Often Drive In-Store Sales

In a recent survey by The Multi-channel Shopping Transformation Study, The e-tailing group/J.C. Williams Group/Start Sampling , 2006, a sample group of consumer where asked, How frequently do you shop in the following ways?  Below are the behaviors that the survey respondents indicated that they were very to somewhat frequently performing:

• Go to the store, then buy online - 19%
• Browse a website then buy in-store - 37%

 

• Receive an email, then buy online - 15%
• Receive a coupon then buy in-store - 60%

 

• Read a newspaper circular then buy online - 15%
• View a newspaper circular online then buy in-store - 34% 

 

• Receive a catalog and buy online - 36%
• Receive a catalog and buy in-store - 25%

Who Are W2S Shoppers?

On average, your typically W2S shopper is:

An average age of 39.7 years

A male between the ages of 18 – 49

Same education/income as e-commerce shoppers

A frequent shoppers

A broadband users

A college graduates

Makes more than $75,000 income (households)

English speaking

Why Online Shoppers Still Go Instore To Buy

Most consumers still prefer to buy in stores they trust, close to where they live, and here is the data to back this up...

Interesting Web - To - Store (W2S) Tidbits

Comscore says: "63% of purchases resulting from online search (and research) occur offline"

Jupiter says: "Ther internet is expected to influence nearly half of all retail sales in 2010"

Burst Media says: "57% of shoppers 18 or older say the intenet is their primary source of information pre-purchase"

How Significant Of Role Does Online Research Play On Offline Retail Spending?

How Mobile Technology May Help Bridge The Web - To - Store Gap

"An interactive marketed for one of the major mobile carriers told me recently that the Store Locater function on his main Web site produces one of the big blank spots in his knowledge about the effectiveness of his online spend. Almost all of his other online investments produce reams of detailed metrics he can use to optimize, calculate ROI, and spec out future projects. The Store Locater gets a ton of traffic, but he has no idea where it goes and how effectively it drives people to the retail stores themselves. There remains an enormous gap between the Web and retail and our understanding of how the two work together. We just know that they do work together--somehow." (Let's Go Shopping, by Steve Smith, Tuesday, Aug 29, 2006 3:01 PM ET)

This is such a great example of the current opportunity that exists in the W2S world. I am betting (as many others are) that mobile applications (such as couponing) will lead the charge in connecting the Web with in store shopping. To drive this bridge forward, the new Web - to - phone space will need to continue to evolve.

To read the full article, click here

Circuit City Claims That 50% Of All In Store Sales Are A Result Of W2S Behavior

Here is a clip from a recent DM News article that demonstrates how much of a part web - to - store sales constitue for one major retailer. It just goes to show how powerful the W2S behavior pattern is becoming.

Multichannel Marketing is Key Says Shop.org

"Another key point is that Web-to-store traffic is a big business. Circuit City gets 50 percent of its customers visiting its Web site at www.circuitcity.com before coming into its store, Scott Silverman (executive director for Shop.org) said. The electronics retailer has also seen a lot of traffic to the store for online returns, which results in new sales.

The Web site not only works in concert with stores, but also with catalogs. Mr. Silverman said that catalogs are evolving and that there is often a spike in online sales just after a catalog drops."

Coupon, Inc program goes contextual to drive web-to-store sales

Coupons Inc. is now putting a spin on contextual ad serving with a new program that serves up coupons contextually, for home printing and store redemption.

For example, the system works when a "bot" scans copy relating to children’s nutrition and healthy cereals on a host site, and then generates links to consumer-printable coupons for whole-grain cereals manufactured by or available at the coupon’s sponsor. The offer of a printable coupon appears in a small window that’s launched when a consumer mouses over highlighted words in the copy. When printed, the coupons are then redeemable at local retailers.

One metric of success for the system, will be an increase in coupon printing and redemption for participating marketers. While many CPG and other sites already offer printable coupons, consumers generally have to look for them in a dedicated area of the site. The contextual presentation of the coupons in the program already is producing multiple double-digit increases in the rate of coupons being printed on participating sites. Coupons, Inc. anticipates that it could increase the store redemption rate, now averaging about 15% to 17% by a few percentage points.

What makes this interesting is that coupons are one of the "tools of the trade" that W2S firms use to help prove that consumers are in fact making the leap from researching online to purchasing instore. However, using coupons to make a business case has traditionally been a very difficult task as the print and redemtion rates are usually very low (much lower than the claimed 15%-17% redemption rates that Coupons, Inc claims). What would be interesting is to possible try out this new technology of serving coupons to consumers in a more relevant manner, and then to see if the results of viewing -> printing -> redemption is any better.

To read more about this store, click here

Newspaper Free-Standing Inserts Helps Consumers Plan Their Shopping

According to a survey study conducted by Scarborough Research (for the NAA), 78% of newspaper readers have used a free-standing insert (FSI) to help them plan an upcoming shopping trip. In addition, 76% of these readers said that these FSI ads helped them save money.

This is good news for the online circular market, as this only goes to prove that FSI's remain a great marketing vehicle to reach consumers with relevant local sale information.

Local Search Could Grow To $13 Billion By 2010 (source: The Kelsey Group)

Will Google dominate local search? How much market share will the IYP's end up owning? Is there an available market play out there for the small upstart to get in and own a piece of the pie? These questions are debated in Forbes this month. The general conclusion - Yes, there is an un-meet need in the market right now to reach mop & pop businesses. The only question is then, who will step up to the plate?

For more information, click here

Local Shoppers Rely on Online Shopping Search Twice as Often as Nearest Media Influences

More interesting W2S research being released from ShopLocal. Within the third installment of the Web-to-Store Benchmark Survey conducted by The Dieringer Group (The DRG), the survey revealed that the number of W2S shoppers has grown by 20%; from 83MM to 100MM. Shoppers also continue to use the Internet, at increasing rates, to research shopping before local shopping trips; relying upon online information nearly twice as often as other media.

Top Media for Product Information Used by Shoppers:
-- Web-to-store internet research
-- Newspaper ads/inserts
-- Local TV ads
-- Local radio Ads

"Consumers depend upon online research to help them decide how, when, and where to shop," said ShopLocal CEO, Brian Hand. "The research shows that most shoppers do both Web-to-store shopping and direct online shopping based on what's most convenient for them. They're smart shoppers looking for readily accessible, trusted and relevant information."

An estimated 100.4 million shoppers utilize the to research products prior to shopping locally. The W2S survey indicates that many of those shoppers purchased locally as opposed to online, for the following reasons:
-- Prefer to avoid shipping costs
-- Did not want to wait for shipping
-- Concerns over product returns
-- Prefer to support local retailers and economy
-- More fun to shop in person at local stores

Products from the following categories are much more likely to be purchased locally after online research includes:
-- Major Appliances
-- Home Improvement
-- Vehicle Parts & Services
-- Cameras
-- Electronics
-- Small Appliances
-- Tools
-- Baby Products

Additionally, 85% of shoppers indicated that they purchase products instore beyond those they researched online. Typical spending is one hundred to two hundred dollars above the products researched online prior to their local shopping trip.

More W2S Shopping Research Data

Here are some interesting results from a W2S study that Schulman, Ronca, & Bucuvalas, NY did for the The Olympian newspaper in December 2003:

- 2/3 of online adults engaged in Web-to-Store shopping in Q4 of 2004.
- Web-to-store shoppers say they saved an average of 8.1 hours of shopping time in the last 3 months by conducting online research before making local shopping trips.
- For every dollar spent online, Web-to-Store shoppers spend $1.60 offline.
Retailers prefer newspaper sites.
- Sixty-five percent of retailers report that newspaper web sites are efficient in assisting them in meeting marketing needs compared with other sites.

Nothing new or suprising here, but again just another source confirming all other research being done on this topic.

ShopLocal.com Survey Finds That 37% of Consumers on Shopping Site Plan to Make Web-to-Store Purchase Within Two Weeks

Proving that what consumers browse and research online leads to actual in store purchases has always been a very difficult challege for anyone in the W2S industry. ShopLocal has tried numerous intiatives to help gage and quantify these types of purchasing behaviors. In the past, the ShopLocal team has looked at special W2S coupon redemption rates, bumps in in-store (physical) traffic, puchase data collected from private label credit cards, web surveys and a host of many other techniques to capture this elusive data. Well the team is at it again and by working with the Dieringer Research Group, it has come up with some very insightful information on how many people actually take action (eg make a purchase) based upon being presented with localized product and store information. Below is the full press release that was put out yesterday that has some finer detail of the survey findings:

Chicago - April 25, 2006: ShopLocal, LLC, the leading provider of Web-to-store (W2S) and e-commerce marketing solutions for retailers announced today that in a recent ShopLocal survey conducted by The Dieringer Research Group, 37% of ShopLocal.com consumers planned to make a Web-to-store purchase within fourteen days of visiting the site.

This proves the ROI on local shopping search and information," said ShopLocal CEO, Brian Hand. "The survey about ShopLocal.com speaks to a larger retail and search trend; when consumers are presented with relevant localization on the Internet, they feel empowered to go out and shop their local stores."

The average reported spending by survey respondents was over $250 and 70% of those shoppers purchased other products at local stores besides those they originally researched. Top categories of additional products purchased included "Food and Beverage," "Household Products," and "Health and Beauty." 30% of respondents also indicated that using the Web site influenced the selection of the bricks and mortar store where they finally made their purchases.

National Retailers Must Embrace Localization On Internet

An interesting column in AdAge earlier this month stated that larger national retailers are going to have to begin to bend their marketing and web site efforts to meet shoppers growing need demand for locally relevant content argues. One of the biggest areas for opportunity is local search. Below is a short clip from the article that goes onto elloborate on the demand, growth and currently available technology solutions for creating relevant local search results:

"National retailers are also failing miserably in providing consumers with a relevant online local search experience. Industry prognosticators report that anywhere from 25% to 40% of the 5 billion monthly search engine queries are local in intent: A 2004 study by The Kelsey Group and BizRate.com, based on 5,000 online buyers, found that 25% of commercial searches were local. Another Kelsey study in December 2003 found that 60% of all searches were local in nature. And a March 2006 study by eMarketer found that "the growth of local search will outstrip national search in every year from 2005 through 2010."

Of course, Google and Yahoo pay attention to large numbers. Each is competing to develop local search results that provide relevant local information, including maps and consumer reviews of local businesses. For example, Google late last month launched a paid service that lets local advertisers place display ads for their businesses within the map that appears along with local search results. Search-engine upstarts such as Metrobot, which arrays merchants on street-level pedestrian-friendly maps, and TrueLocal, which winnows search results to actual bricks-and-mortar stores, are delivering on the consumer's desire to have a local Internet experience.

While most national retailers use search engine optimization techniques to make their Web sites pop up when a consumer types in their store name and a city, or a product category and a city, the payoff to the consumer is anything but "local." The consumer ends up at the retailer's main home page, where she must then search again for her desired product and then navigate to the store locator feature, which merely provides a map and telephone number.

Some technology companies are developing solutions that allow retailers to create more relevant local search results. For example, ShopLocal, Local Thunder and ReachLocal have each developed unique platforms-with different emphases-that allow retailers to create relevant content to respond to local search queries. The Local Thunder platform also features a technology that builds local-content landing pages that operate off the retailer's Store Locator feature and local search-engine queries."

To read the entire article, go to: http://www.adage.com/article.php?article_id=108378

Consumers Searching Retailers' Local Online Circulars Grew 18.7% in the Q1 of 2006

Here is an interesting statistic that the analysts team here at ShopLocal came up with. Within the first quarter of 2006, as compared to the same period in 2005, consumers interest for local store and sale information grew at 18.7%. This clearly helps demonstrate that internet users are ever interested in searching the web for localized pre-sale information. Retailers that help equip their customers with this local pre-sale information are seeing the direct benefits such as increased in-store traffic and higher promotional sales lifts, as consumers are more and more doing their pre-shopping research and decision making online and then going into stores to buy.

To read the entire press release, go to: http://biz.yahoo.com/prnews/060419/clw504.html?.v=37

Target's Online Weekly Ad Site Finds A Way To Keep The 'Lights On'

Target during the week on 04/16 - 4/22 is running a very interesting concept. Instead of not offering their online guests any online specials and deals on their very successful online weekly ad site during a week were no regular Sunday circular/FSI was produced, Target took one another small step forward to bridging the web - to - store divide. The online marketing team @ Target decided to create unique web only content for this one week period. What makes this innovative is that the marketing department was not constrainded with the typical limitations of the circular print production process. Rather the team was able to explore new presentations of local in-store sale content to their online guests. I am really excited for this concept to catch on with other retailers as it opens up new doors for content creation and publication (by not having to follow the newspaper ad / FSI model of creating localized sale information).

To check it out, go to: http://target.shoplocal.com/target/

Multichannel Retailers Will be Bringing The Web Into The Physical World More And More - Forrester

Here is an intresting clip from a September 2005 Forrester Research paper that talks about some future growth predictions that mixed multi-channel retailing is in for:

"With more retailers offering the ability to buy online and pick up in stores — bringing eCommerce experiences into stores with kiosks and using the Web as a test market for new product lines — multichannel retailers do their share to introduce and hype online shopping to consumers. As store networking costs fall and retailers look for innovative ways to differentiate their store experiences, this trend will accelerate during the next five years, introducing eCommerce and technology to the masses. As consumers find themselves surrounded by technology in retail experiences, even some of the 30% of online Web buying holdouts will submit — fear and reluctance to use technology is the main reason that they don’t shop online today.5 Women make up a large portion of this group, and as they now outnumber men in the online shopping ranks, they buy from new product categories. The health and beauty category will grow at a 22% CAGR during the next five years, and the entire apparel category (apparel, accessories, and footwear) will total nearly $26 billion in 2010."

How To Leverage Multi-Channel Fulfillment To Produce A Seamless Customer Experience

Converged software solutions are beginning to make it possible for a multi-channel retailer to provide to their customers product information, customer service, shopping experience and order fulfillment throughout all areas of their business. While in the past, most retailers adopted a very compartmentalized approach to their online and store channels, consumers are now being trained to expect retailers to be able to do actions like: buy online --> return in store or order in-store via a kiosk --> get the item shipped to your home for free. The number of consumers performing these types of web-to-store (W2S) behavior will continue to increase, so there is now a real incentive for retailers to begin to offer these types of services to their consumers. My prediction still stands that ntegration of systems, channels and processes will continue to be one the key driving forces in retail over the next 5-7 years.

To read the entire store, go to: http://www.catalogsuccess.com/leadstory/285803600896825.bsp

Shop Online, But Pick Up At Your Local Store

For years, the folks around my office have all deemed local in-store inventory information the "holy grail" of web-to-store shopping information. Well, Jeff Bezos would differ. He states that he does not see the value often times of providing consumers this type of information online as most larger retailers manage on-shelf inventories so well that most items are always instock. For the Wal-Mart's of the world out there, this is true. But when it comes to smaller niche retailers, knowing whether an item is availble in-store for pickup today before leaving the house is a powerful value proposition. Circuit City proved this with the recent (successful) launch of their buy online, pick up in store campaign. They claim about 50% of their web orders are being fulfilled through local brick-and-morter retail stores. This simple fact really shocks me that other retailers are not getting on board with this idea as a key way of leveraging their phyisical retail assets. Only time will tell...

To read the entire article go to: http://www.businessweek.com/2000/00_24/b3685268.htm