Veteran Web Buyers VS. Rookies

May 1, 2008

Nearly three quarters of U.S. consumers say they have shopped online, according to Forrester Research. With that much saturation of online shopping, newcomers make up a steadily shrinking share of all web shoppers.

Just nine percent of online shoppers had less than a year's experience shopping at websites in a survey conducted by Forrester. That is down from 16 percent in the previous year. In the newer survey, 32 percent of consumers had seven or more years of online shopping experience, up from 16 percent the year before.

Experienced web buyers are more likely to be male, have higher incomes and are slightly older than newcomers. More than half of consumers with less than a year shopping online were female. Their main age was 42, and their annual household income averaged $61,900. Just 41 percent of online shopping veterans were female. Their main age was 45, and household income averaged $95,300 a year.

Those with seven or more years of online buying experience were found to shop more heavily on the web. They spent, on average, $1,020 in the previous three months, versus $330 during the same timeframe for newcomers.

They are also more likely to start their shopping research at a search engine than those with a year or less of shopping online. Of the more experienced, 29 percent begin at a search engine, while just 14 percent of the newcomers do. "One interpretation of these contrasting research styles is that experienced web buyers capitalize on search engines' ability to uncover the lowest price, while new web buyers treat the online shopping experience as if they were at the mall, heading straight to their desired retailer," wrote Forrester analysts Carrie Johnson and Peter Hult in the report.

The Forrester analysts concluded that online retailers' efforts must shift from customer acquisition to retention, because there are fewer online newcomers to woo. They also noted that newcomers are more concerned than online veterans about payment security and the privacy of their personal information.

To address those concerns, online merchants should explain their privacy policies when asking for personal information and consider offering alternative payment systems, such as PayPal and Google Checkout. These systems allow consumers to shop at many merchants, while providing personal information to only a single entity.

Topic: Wholesale News

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Article ID: 637

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