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Majority of US Consumers Research Online, Buy Offline

  |  October 6, 2004   |  Comments

Most online shoppers convert offline, and spend more in the process.

There are those who walk into a store not knowing what they may find. Then, there are those that come in to a retailer already knowing exactly what they want because they've done their product research online.

Forrester Research has a name for it: "cross-channel shopping." It's rapidly becoming a force to be reckoned with. In a report titled "The US Consumer 2004: Multichannel and In-Store Technology" the research firm details a number specific shopping characteristics and behaviors particular to cross-channel shoppers. The analysis was based on a survey of 8,000 online consumers.

Cross-channel shoppers actually comprise the majority of all online consumers, 65 percent in 2004. Of these, 51 percent are characterized as active cross-channel shoppers who made at least one purchase in the past three months. The trend is bound to continue; the number of new cross-channel shoppers in the past year was 30 percent.

Stakes for retailers are particularly high. Cross-channel shoppers spend an average $458 on products they research online and buy offline. When they do hit the offline store, 47 percent end up spending more, $154 on average for additional products.

Cross-Channel Shoppers Spend Billions Offline
Cross-channel
transactions
per year
(millions)
x Average
transaction
size
= Cross-channel
Shopper
Spend
millions
Consumer Elec. 50 $430 $21,573
Appliances 25 $516 $12,870
Hardware/Software 19 $423 $7,979
Home Goods 22 $314 $7,053
Apparel/accessories 38 $91 $3,492
Books/Music/DVD/
Video Games
64 $50 $3,203
Other 86 $400 $34,501
Total 305 $90,670
Incremental in-store spending $11,972
Grand Total $102,643
Source: Forrester Research

"What surprised us the most was the additional spending of consumers [the $154 figure] once they are in the store," Charles P. Wilson quantitative associate at Forrester Research told ClickZ. "This stat shows how important customer retention across channels is. If retailers fail to do so, they not only lose the sale of the product researched online, but also the sale of these incremental goods. Right now, we see consumers switching retailers half the time when they switch channels, hardly an encouraging sign."

Active Cross-Channel Shoppers are Younger
and Wealthier Than Other Online Consumers
Have Never
Cross-channel
Shopped
Less Than
5 Years
5 or
More Years
Age 48 44 42
Household income (US$) $56,476 $58,818 $73,669
Married or partnered 72% 81% 77%
Household size 2.60 2.92 2.65
Has college degree 26% 28% 48%
Has broadband at home 21% 30% 43%
Made purchase online in
the past three months
40% 61% 76%
Source: Forrester Research

The cross-channel shopping demographic is comprised of wealthier, younger and more experience online consumers. This group earns 22 percent more than non cross-channel shoppers and is five years younger. Adoption levels for online purchasing are 75 percent higher for cross-channel shoppers than their one-channel counterparts, with 71 percent making an online purchase in the past three months.

Reasons cited by cross-channel shoppers for buying offline include, as 48 percent noted, they want to actually see the item before purchasing it. The least noted reason was the need to talk with a salesperson before buying, which only 16 percent gave as a reason for buying offline.

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