Despite growing interest in marketing to customers who buy offline after researching online — multi-channel shoppers — such consumers might be less worth pursuing than originally thought, according to a new study from Jupiter Research.
The findings from the New York-based researcher — which is a unit of INT Media Group, the publisher of this site — concluded that shoppers who purchase through more than one of a brand’s channels are indeed more valuable to e-commerce marketers. The group purchases more, and more often, than single-channel buyers. As the thinking goes, they’re also more brand loyal than single-channel shoppers.
But true brand-loyal, multi-channel consumers represents a far smaller group than many might think, according to Jupiter. While an estimated 66 million consumers use the Internet for purchasing and researching offline purchases, only about 16 million frequent the same brands on- and offline.
Instead, most multi-channel shoppers tend to be brand-agnostic, making their channel and purchasing decisions based more on price than brand loyalty. Because they’re more savvy, they’re also more aware of price discrepancies between different retailers and different channels.
They also tend to consume a disproportionate amount of marketers’ and e-tailers’ online customer service and presentation services — cutting into their profitability for sellers.
Additionally, brand loyalty among multi-channel shoppers will continue to wane, in tandem with the sheer decline in numbers of shoppers who buy via online and offline channels. By 2006, total spending impacted by Web activity will total $582 billion, according to Jupiter. Multi-channel, brand-loyal shoppers will continue to account for about 19 percent of this total, although cross-channel shoppers showing no real loyalty to a retail brand will grow from 56 percent now to 64 percent.
That’s due to the fact that brand-loyal multi-channel shoppers — which Jupiter calls “actives” — tend fall in the 19-to-35 age demographic, three-quarters of which is already online. On the other hand, the seniors coming on the Internet for the first time are expected to increase the number of multi-channel consumers that pay less heed to the retail brand.
As a result, e-commerce marketers that spend large amounts of resources to woo and retain multi-channel buyers might want to rethink their strategy, wrote Juliana Deeks, lead author of the report.
“Retailers should avoid the temptation to equate customers’ willingness to transact across multiple channels with store loyalty,” she wrote. “To maximize online profitability, each retailer must vigilantly segment and analyze its customers, and thereby determine how much its own multi-channel buyers merit attention and resources beyond those allocated to other online shoppers.”
The report comes following the rollout of products geared toward marketing and retaining multi-channel buyers by a number of online marketing services and analytics companies.
Data giant Experian and DoubleClick’s Abacus unit, for instance, each recently debuted services geared toward helping clients track and market to the on- and offline spending of its customers. Online loyalty plays CoolSavings and E-centives also recently launched products that tie together traditional and Internet communications.
To the extent that such products could help marketers track the habits of cross-media buyers, they could prove a boon, according to Jupiter. But expensive efforts in profiling, cross-media couponing and redemption, and extensive on-site presentation tools might need to be rethought, the report concluded.
Reprinted from Internet Advertising Report
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