Free Shipping Tops E-Commerce Purchase Considerations, ComScore Says
Mobile phones and tablets accounted for 9 percent of online spending in Q2, according to comScore’s “State of the U.S. Online Retail Economy Q2 2012.” For the year, e-commerce retail sales are up 16 percent to $87 billion, said Gian Fulgoni, chairman of comScore, on a webcast, and online retail is growing at nearly four times the rate of total consumer spending. In Q2, 15 percent growth in e-commerce was seven times higher than the growth in consumer spending in comparable categories, Fulgoni said, saying e-commerce now accounts for roughly $1 or more out of every $10 of discretionary spending.
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By income level, mid-income consumers ($55,000-$99,000) represent 43 percent of online revenue, followed by upper-income consumers ($100,000 and above) with 34 percent and low-income shoppers (under $50,000) at 23 percent, comScore said. While all segments posted double-digit growth in the quarter over Q2 2011, there were slight dips across the segments from Q1 of this year, Fulgoni said. The percent of consumers who viewed the economy as “poor” hit its highest point this year at 56 percent in July compared with 49 percent in April and 54 percent in January, Fulgoni said.
Deals factored heavily into purchase decisions during the period, and the average price per daily deal grew from $56.98 per deal in Q2 last year to $76.33 per deal this year, Fulgoni said, citing data from Local Offer Network/dealradar.com. Flash sale sites continue to see growth in unique visitors with baby site Totsy.com listed as the fastest-growing flash site at 881 percent growth, with 785,000 unique visitors in Q2, he said.
Free shipping is the leading draw for online shoppers, data showed. The percentage of transactions with free shipping fell to 42 percent in Q2 from 49 percent in Q1, according to data, but 55 percent of consumers in a recent comScore survey said if they reached the payment page of a transaction and free shipping wasn’t offered, they'd cancel their order. Sixty-one percent of online shoppers said they'd rather pick up a product in-store than pay for shipping to their home. Free shipping led the list of factors influencing an online buying decision at 37 percent, followed by knowing when a delivery would be made (18 percent), an easy-to-understand returns process (14 percent), express shipping options (10 percent), availability of environmentally-responsible products (8 percent), ability to select a 2-hour delivery window (7 percent) and ability to re-route a delivery package to another location while in transit (6 percent), according to data.
Mobile purchases are growing at a brisk pace, Fulgoni said. More than 4 million new smartphones were activated in Q2 in the U.S., taking the total audience to more than 110 million. Nearly two in five tablet owners have made an online purchase via their device in the past 2 months, more than double the number of smartphone owners, which Fulgoni attributed to more screen real estate. Some 43 percent of tablet owners researched products online in the survey period and 42 percent price-shopped with their tablets, he said, compared with 21 percent and 22 percent, respectively, for smartphone owners.
The survey was done the week of July 30, covering buying habits through June 2012. Consumer behavior information comes from comScore’s panel of 2 million consumers whose behavior the market research company tracks “with explicit permission” including search behavior; advertising exposure and effectiveness; demographics, lifestyle and attitudes; mobile Internet usage and behavior; media and video consumption; transactions; and online/offline buying, it said.