120 Million Web Users Shop Online

Nearly 120 million of the estimated 300 million worldwide Internet users have already made a purchase or transaction online, with as many as one in four purchases made on impulse, according to an Angus Reid Group study of Internet users in 34 countries. The study found that, contrary to popular belief, the vast majority of shoppers were very satisfied with their online experience and only a minority voiced concerns about fraud and security issues.

“The online encryption and security industry has done a terrific job reducing concerns about online shopping,” said Brian Cruikshank, senior VP in charge of Angus Reid’s “Face of the Web” study. “Still online credit card payment is more of a North American phenomenon than a global one.”

According to the study, barely half of shoppers outside the US and Canada use credit cards, compared with 75 percent in North America. Cash on delivery and bank drafts are almost as popular as instant credit card payments in Asia and Europe.

Forty percent of all Internet users, about 120 million people worldwide, have made at least one purchase online, the study found. More than half (54 percent) of all online transactions were made in the US. The typical American online shopper made seven purchases over the past three months for a total of $828, compared to the global average of less than $500. As well, three-quarters of Internet users around the world expect to spend more online this year than last. The majority of online shoppers planned their purchases and knew exactly where to find what they were looking for, but 24 percent said they found a product by chance in the course of a routine Internet session.

“Advertising and word-of-mouth work,” Cruikshank said. “But I wouldn’t discount the sheer pleasure and fun of random surfing. That’s the beauty of the Web: you never quite know where you’ll end up and what you’re going to do next. Internet users have become avid window shoppers.”

The most frequently mentioned use of the Internet in relation to shopping was gathering information about products and services, done by 52 percent of Internet users. Forty percent have taken the plunge and purchased a product or service directly online. Other commercial services, such as chat lines (37 percent) and sampling or downloading music (36 percent), have also attracted many Internet users, especially among the younger users. Financial transactions, such as banking (20 percent) and stock trading (8 percent) also attract a sizable base of global users.

“One interesting development is that the American market is beginning to lag behind in certain sectors — for instance, online banking is more widespread among Internet users across most of Europe, or in South Africa and Brazil, while downloading music files has really taken off in Latin America, Asia, developing countries such as Turkey or Egypt,” said Clay Braziller, a VP in Angus Reid’s Interactive Research Division.

The goods most frequently purchased online included books (37 percent), computer equipment and software (21 percent), music or music CDs (20 percent), and clothing (17 percent). Two-thirds of the online purchasers in the survey had bought something online in the past 30 days.

Internet information gathering is potentially as important as actual transactions, according to Braziller.

“Using the Web to get information about products or services, whether just to ‘window shop’ or plan a future purchase, can be a springboard to a whole series of future transactions that can take place on- and offline, using either old or new distribution channels.”

Online shoppers show every sign of making the Internet a regular part of their shopping behavior. Among those who said they were likely to buy books, music recordings, travel tickets, or computer software in the next 12 months, nearly half indicated they would make their purchase online, while most of the remainder planned to use the Internet for gathering information about the products they intended to buy elsewhere.

Global Internet users who had made an online purchase also registered a high degree of satisfaction with the process — 71 percent described themselves as “very satisfied” with their last online transaction and another 22 percent were “somewhat satisfied.” The majority (60 percent) of global online purchasers cited convenience as their motivation for using the Internet over traditional shopping methods.

“Like so many other aspects of the Internet, online commerce is hard to give up once you have tried it,” Braziller said. “A few people are still reluctant to try shopping online because of security concerns, but this is starting to recede as more attention focuses on privacy issues.”

The global study is based on a sample of 28,374 Internet users and consumers. It was conducted by telephone or face-to-face using conventional research techniques and full random sampling in 34 countries in December of 1999. Some of the data were collected before the 1999 holiday season where a number of Web sites experienced major customer service and delivery problems.

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