Online Shopping - US

Published by: Mintel International Group Ltd.

Published: Jun. 1, 2010 - 100 Pages

Table of Contents

SCOPE AND THEMES

What you need to know

Definition

Data sources

Sales data

Consumer survey data

Advertising creative

Abbreviations and terms

Abbreviations

Terms

EXECUTIVE SUMMARY

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

MARKET SIZE AND FORECAST

Market still growing through recession

Figure 1: Total U.S. e-commerce retail sales, 2004-14

Figure 2: Total U.S. e-commerce retail sales, at inflation-adjusted prices*, 2004-14

COMPETITIVE CONTEXT

Key points

Online share growing but adoption may see a plateau

Figure 3: E-commerce sales as a percentage of total retail, 2001-10

Web-only retailers growing faster than retail chain web sales

Figure 4: 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

Figure 5: Attitudes toward online gift shopping, February 2009 and March 2010

SEGMENT PERFORMANCE

Key points

Electronics, recorded entertainment, toys post large gains in recession

Figure 6: 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

Figure 7: Categories of internet purchase, 2006-09

LEADING RETAILERS

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

Figure 8: Sales and related statistics of top ten internet retailers, 2009

Amazon receives monthly business from a third of e-shoppers

Figure 9: Popularity of online retailers, March 2010

Youngest respondents 18-24 show greater skew toward Amazon and eBay

Figure 10: Popularity of online retailers, by age, March 2010

Value-oriented brands see lower traffic from $100K+ respondents

Figure 11: Popularity of online retailers, by household income, March 2010

eBay rebrands as fixed-price vendor of new merchandise

INNOVATION AND INNOVATORS

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

Top e-commerce brands place emphasis on customer lifestyles

Figure 12: Amazon—Diverse Customers, December 2009

Figure 13: eBay—Chevy Motors, August 2009

General merchandiser sites incorporate theme of gift giving

Figure 14: Zappos—Gift Exchange, March 2010

Figure 15: Overstock—Dad Knows Best, May 2010

Vendors of groceries and apparel reach out to family demographic

Figure 16: Peapod—Frantic Family, March 2010

Figure 17: JCPenney—Kids Matter, August 2009

ONLINE PROMOTION

Key points

Web retailers rely on lead generation for traffic

Email

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

Figure 18: Clicking on internet ads, by various demographic factors, February 2009 and March 2010

Limited appetite for social network marketing

Figure 19: Attitudes toward online promotions and coupons, March 2010

MARKET DRIVERS

Consumer confidence undermined by high unemployment and foreclosures

Figure 20: Consumer confidence and U.S. unemployment rate, January 2008-May 2010

Decline in revolving credit puts pressure on consumer expenditures

Figure 21: Outstanding consumer credit, January 2008-May 2010

Convenience is internet’s top value proposition

Figure 22: Motivations behind online shopping, March 2010

Consumers warm to e-commerce for broader range of purchases

Figure 23: 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

Key points

Recession stalls growth of online consumer base in 2009

Figure 24: Incidence of internet purchase, 2006-09

Penetration skews female, younger, and higher income

Figure 25: 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

Figure 26: Type and frequency of purchases made, March 2010

Key demographic for e-commerce: 25-34-year-olds

Figure 27: Type and frequency of purchases made, by age, March 2010

MOTIVATIONS

Key points

Price savings, lack of local availability decline in importance

Convenience central driver

Figure 28: Motivations behind online shopping, February 2009 and March 2010

Convenience more important than low prices for over-35s

Figure 29: Motivations behind online shopping, by age, March 2010

Female-oriented sites would benefit from wish lists and wide selection

Figure 30: Motivations behind online shopping, by gender, March 2010

REASONS NOT TO SHOP ONLINE

Key points

Key reasons for not shopping online not diminished

Figure 31: Reasons not to shop online, February 2009 and March 2010

Shipping charges more likely to deter women

Figure 32: Reasons not to shop online, by gender, March 2010

Older shoppers more resistant to purchasing remotely and shipping fees

Figure 33: Reasons not to shop online, by age, March 2010

Lower-income respondents may be less willing to take online risk

Figure 34: Reasons not to shop online, by household income, March 2010

COMFORT WITH ONLINE SHOPPING

Key points

Increasing comfort with online shopping leading to more purchases

Figure 35: Comfort with online shopping, February 2009 and March 2010

Under-35s more concerned about delivery times

Figure 36: Comfort with online shopping, by age, March 2010

Highest earners more willing to try unfamiliar web stores

Figure 37: Comfort with online shopping, by household income, March 2010

ROLE OF ONLINE REVIEWS

Reviews represent a strategic draw

Figure 38: Attitudes toward online product feedback, by household income, March 2010

MOBILE SHOPPING

Key points

Mobile shopping still limited to early adopters

Figure 39: Attitudes toward mobile shopping, March 2010

25-34-year-olds, higher earners most likely to use phones for shopping

Figure 40: Attitudes toward mobile shopping, by age, March 2010

Figure 41: Attitudes toward mobile shopping, by household income, March 2010

PRICE-COMPARISON SITES

Key points

Price comparison users are fragmented among multiple sites

Figure 42: Popularity of price-comparison sites, March 2010

Men more likely to use price-comparison sites

Figure 43: Popularity of price-comparison sites, by gender, March 2010

25-34-year-olds are key demographic for price-comparison sites

Figure 44: Popularity of price-comparison sites, by age, March 2010

Higher-income household members sophisticated at price comparison

Figure 45: Popularity of price-comparison sites, by household income, March 2010

CHECKOUT SERVICES

Online payment usage follows from frequency of purchase

Figure 46: Usage of checkout services, by gender and age, March 2010

PayPal remains dominant provider of checkout services

Figure 47: Popularity of checkout services, by age, March 2010

RACE AND HISPANIC ORIGIN

Key points

Skew in online adoption strongly linked to income disparity

Figure 48: Incidence of internet purchase, by race/Hispanic origin, 2009

Asians early adopters but financially risk-averse

Figure 49: Comfort with online shopping, by race/Hispanic origin, March 2010

Online Asians and Hispanics more likely users of price-comparison sites

Figure 50: Popularity of price-comparison sites, by race/Hispanic origin, March 2010

Asian respondents more active in searching for online coupons

Figure 51: Attitudes toward online promotions and coupons, by race/Hispanic origin, March 2010

Asians and Hispanics more likely to adopt cell phone commerce

Figure 52: Attitudes toward mobile shopping, by race/Hispanic origin, March 2010

APPENDIX: OTHER USEFUL CONSUMER TABLES

Motivations

Figure 53: Motivations behind online shopping, by household income, March 2010

Comfort with online shopping

Figure 54: Comfort with online shopping, by gender, March 2010

Popularity of online retailers

Figure 55: Popularity of online retailers, by gender, March 2010

Shopping with cell phones

Figure 56: Attitudes toward shopping with cell phones, by gender, March 2010

Checkout services

Figure 57: Use of checkout services, by household income, March 2010

APPENDIX: TRADE ASSOCIATIONS

Abstract

Brands must be wholly transparent. Or else.

The ongoing fallout of the credit crunch has provided a series of reminders that there are dangers everywhere, and few organizations in which consumers can place total trust. The world of politics has been suffering from a transparency deficit pretty much from day one.

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