Thursday, December 22, 2016

Retail Physics

Online shopping is on a roll. Today around eight-in-ten Americans are online shoppers. 79% have made an online purchase of any kind, 51% have bought on a cellphone and 15% have purchased by following a link from social media sites. These are among the findings of an interesting survey from Pew on how new technologies are impacting a broad range of Americans’ commercial behaviors. Back in the first Pew online shopping survey of 2000, only 22% of Americans had made a purchase online.

The story within the story, is that human fundamentals remain just that. What stands out is that US shoppers still prefer physical stores. All things being equal , almost two thirds of US consumers prefer to visit physical stores. 20% report never shopping online, 15% say an e-commerce purchase happens weekly, 28% report buying online a few times each month, and 37% less often.

Looking beyond this, technology is a game changer, price is a pretty big deal, and your phone is pretty smart. When considering a purchase, around two thirds Americans  typically compare the in-store price with the online price  and pick the cheapest. About one fifth say they would buy from stores without checking prices online. About one seventh would typically buy online without checking prices at physical stores first. Notable is that half of U.S. adults under 50 routinely check online reviews before buying new items, even though many are concerned whether these reviews are trustworthy.

In the physical shopping environment, the mobile is a magic multitasker. Pew: 59% of US consumers use it in a physical store to call or text to talk over a purchase, 45% research reviews or other product info. Another 45% search online for cheaper, and 12% use their mobile to buy in-store. The future of shopping is coming around the corner. It’s a fun fest of format variations where convenience, cost and customization meet touch, and care and warmth. The trick for retailers is to find the sweet spots.