What We’ve Learned About Online Holiday Shopping So Far This Year

Sucharita  Mulpuru

As retailers approach the homestretch of the 2010 holiday shopping season, we thought it would be useful to share some insights from consumers about their Web buying activity. Forrester and Bizrate Insights teamed up in late November/early December to survey online customers, and here are a few of the findings:

  • Free shipping with a threshold is most popular (though people would, naturally, prefer to have no threshold). One interesting fact is that the threshold (in addition to adding units to transactions) attracts higher-income shoppers. Households with incomes over $150k are nearly twice as likely to use “free shipping with a threshold” than households with incomes less than $40k.  
  • 9% of shoppers say they belong to some shipping club (e.g. Amazon Prime, ShopRunner) and participation skews up with income. 13% of households with incomes over $150k say they have this type of membership.
  • Email still rules. From our Cyber Monday research with Bizrate Insights, 43% of consumers who shopped online on that day found out about deals through email. This was by far the most popular way that people found out about deals, greater than search, Facebook, or even word of mouth.  The second biggest source of finding out about deals was a retailer’s own site. 
  • It’s about women and gifts during the online shopping season. Again from our Cyber Monday research with Bizrate Insights, 69% of online shoppers were women. Only about half of men purchased gifts for others that day, but 78% of women purchased gifts that day. 
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What 1D Product Codes Did Consumers Scan This Shopping Season? Toys ...

Julie Ask

ScanLife reported that the amount of scanning traffic was 30x higher during Thanksgiving weekend than one year ago. Wow! Product purchases from the application were also up nearly threefold. Books were most purchased. Toys were most scanned. See this story on PR Newswire. This Forrester report offers our perspective on a developing technology.

Cyber Monday Post-Mortem

Sucharita  Mulpuru

Enough with the Groupon madness this week.  Let’s talk about things that actually impact our businesses.  Like holidays sales to date, and in particular, a quick post-mortem on Cyber Monday now that the week is over.  Forrester fielded some questions to consumers in conjunction with Bizrate Insights (the findings will be available in full to clients in a few weeks) and here are some quick takeaways as teasers: 

  • Most people don’t buy on Cyber Monday (though many would like to), so the Cyberweek deals like Amazon has are always a good idea.  62% of the 3,200 shoppers we surveyed said that they didn’t shop on Cyber Monday.
  • Of those who shopped but did not buy (45% of shoppers who were trolling eCommerce sites on Cyber Monday!), 28% wanted to buy but didn’t see any products that they wanted. Product selection is king.
  • Social, schmocial.  Not such a big deal yet.  Only 7% of people who found deals on Cyber Monday found them through social networks or Twitter, versus 51% who found them from emails from the retailer.
  • Some people live under rocks. Kidding. But one-fifth of the people who didn’t shop on Cyber Monday said “They didn’t know there was anything special about that day.”  How that is possible I have no idea, but I’ll give them the benefit of the doubt and assume they don’t have time in their lives to squander away time online like the rest of us.  But for anyone really wondering what this “special day” is about, check out this link (see the full slideshow here) — these are screen shots of the top 50 merchants’ home pages from this past Monday.
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Two Of The Hottest Words In Mobile: eBay And 2D Bar Codes

Julie Ask

I was really lucky this morning. I've been spotting the yellow eBay buses around town (San Francisco) recently. I love it when companies like eBay promote new services like their mobile application -- it does so much to raise awareness and eventually demand for new services. There was one stopped next to my car when I got out of Starbucks this morning. Yay! I quickly set down my tea and reached for my phone to get a photo. The ads are promoting eBay applications for mobile phones. What I hadn't noticed were the individual QR codes helping people find the applications and download them. Companies like Target, Best Buy, and eBay using QR codes will increase awareness first of 2D bar codes and QR codes and second of the ability/option to connect with online content through your phone.

 

More importantly, eBay was in the news today because it reported a 146 percent jump in mCommerce sales on Cyber Monday. (See press release.) It has been public with its expectations of generating more than $1.5 billion in gross merchandise volume in 2010 compared to $600 million in 2009. I think this qualifies it as one of the hottest names in mobile commerce at least.

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Mobile Enables New Businesses ... Can You Name One?

Julie Ask

I was in San Diego airport this past weekend on my way home to San Francisco. A nurse in the airport was offering vaccinations and flu shots. Not so interesting I know. What was interesting is that she was using an iPad with a "Square" (see product description or https://squareup.com) to collect payment with a credit card. I stopped, of course, to talk with her about her experience.

A year ago they accepted cash or check only. Now they accept credit cards. They used the software provided by Square to build out an application that allows one to choose the vaccinations. The application compiles an itemized bill. The card is read by the Square and processed. The customer signs with a finger on the iPad. And . . . the customer can get a receipt via email immediately. End result? More accurate records. Real-time bookkeeping. More revenue b/c more payment options.

Intuit and others offer payment mechanisms through mobile phones and other portable devices with connectivity. These innovations will continue to enable small businesses and entrepreneurs to pursue new ideas . . . and in this case simplify the payment process. Totally cool. I love seeing ideas like this. Please post comments to this blog if there are others I should see.

Why Google Buying Groupon Is a Bad Idea

Sucharita  Mulpuru

So the latest rumor is that tomorrow Google will buy Groupon for $5 billion.  You're not alone if you think that's crazy.  Here’s why:

  • $5 billion is an absurd valuation for a company that is in a business with virtually no barriers to entry and is younger than my toddler. 
  • That’s more than what they paid for YouTube, which had a heck of a lot more traffic when it was acquired than Groupon has now.
  • It’s a huge chunk of the cash that Google has on hand.  That’s a lot of money. 
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Amazon Follows Typical US Online Retailer Expansion Path With A New Site For Italy

Zia Daniell Wigder

Amazon today launched a localized site for Italy, its first new international offering since acquiring Joyo back in 2004 (Amazon’s UK and Germany sites were launched in 1998, France and Japan in 2000 -- the Canada site came in 2002. Full timeline available here). According to today's press release, the new offering has more categories than any new Amazon Web site has ever launched with -- not surprising given the six years that have elapsed since the last international launch.  

As part of its new offering, Amazon is pushing its selection of “hard-to-find Italian language items” to cater to local consumer needs -- indeed, Amazon has tended to excel in its localized offerings, ranging from its varied payment methods by country to its semi-localized categories (note the “Auto and Motorcycle” category on the German Web site or the “DIY” link on the UK one).  

Amazon’s choice of European markets mirrors many US online retailers’ expansion into Europe. Of the top 50 online retailers in the US, some 19 operate dedicated transactional Web sites for the UK, 14 operate sites for Germany, 12 for France and 14 in Italy. Less than 10 operate eCommerce sites localized for Spain. See the graphic from our recently published Establishing A Global Online Retail Footprint below.

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Target: Mobile Retailer Of The Year

Julie Ask

Target was just named the "2010 Mobile Retailer of the Year" by Mobile Commerce Daily (see article). Hard to believe eBay wasn't in the top three with their anticipated $1.5B revenue on the mobile channel this year, but they won last year. This speaks to the fact that it isn't just about revenue. In fact, among companies we've surveyed, offering convenient services to customers to engage them more, improve satisfaction and loyalty, etc. top the list of near-term objectives. If the services aren't convenient (see research), consumers will not adopt and use the services. If this doesn't happen, companies won't see the revenue growth or cost savings they are anticipating.

One of the top questions I get from clients is, "Who is best in class?" Any of these three retailers could take that honor. What really impresses me about Target is their breadth of innovative services, the quality of the experience, and to top it off . . . they sell to mainstream America. My favorite service: building a shopping list with the bar-code-scanning technology. Remember that example we've all heard about the smart refrigerator? You remove and throw the empty milk carton out, and "milk" is automatically added to your shopping list. This doesn't do that exactly, but it comes closer than any other application I know. There is also tremendous consistency in experience from online to mobile Web to the applications -- at times, it is so good that it's indistinguishable.

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The Co-operative Bank Tops Forrester's 2010 European Bank Customer Advocacy Rankings

Benjamin Ensor

A few months ago I blogged about how the UK’s Co-operative Bank had come top in our UK Bank Content & Functionality Benchmark. The bank has now done it again by coming top in our 2010 European Bank Customer Advocacy Rankings.

Customer advocacy is the perception among customers that the bank does what’s right for them, not just what’s right for its own bottom line. In every country we survey in our Consumer Technographics® research, we’ve found that customers who view their main bank as a customer advocate have more accounts at their main bank, are more likely to consider their bank for their next financial purchase, and are more likely to recommend it to others.

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Forrester's Online Holiday Retail Forecast Projects 16% Increase Over '09

Sucharita  Mulpuru

Forrester’s "US Online Holiday Retail Forecast, 2010" launches today, reporting quite a bit of optimism this shopping season. November and December alone are expected to pull in nearly $52 billion, a 16% increase over 2009. Several key factors contribute to this projection:

  • Consumers are shifting more and more to online retail.
  • Offline retail is still a significant player.

Consumers are cooperating, too. They’re looking to spend more this season and do so through a variety of means (mobile, apps, etc.).

Retailers are responding with numerous strategies, such as larger promotional budgets, honing in on key dates, and experimenting with new shipping options.