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The Internet Will Lead Consumers' Research and Purchase Behavior in What Could Be a Lower Holiday Spending Season

Posted on: Monday, 1 October 2007, 12:00 CDT

According to a recent survey by Burst Media, the percent of consumers who expect to complete either a portion or all of their holiday gift purchasing online this year has surged to more than half (50.7%), up from 37.6% in 2006.

While increasing use of the Web for holiday shopping is a positive sign for Internet retailers, there are also signs of economic uncertainty among consumers. Survey results indicate holiday spending is likely to decline from 2006 levels for many consumers. Among survey respondents, one-quarter (25.6%) expect to reduce spending, 36.1% will spend the same amount as the prior year and only 16.8% expect spending to increase. These conservative spending estimates are true even among the highest income segments.

In September 2007, Burst Media, a leading provider of advertising representation, services and technology to independent Web Publishers, conducted an online study of 2,400 web users 18 and older about their expected use of the Internet for the 2007 holiday season. This web-based survey examined how people plan to use the Internet to research and purchase products online for the holidays.

The survey revealed many interesting findings about consumers' online shopping habits. These include:

Window shopping is a critical part of Internet shopping: Survey findings show over two-thirds (68.6%) of consumers shop online and use the Internet as a resource to research products. Online shopping, however, does not always result in online purchasing. Online shopping is split between Internet "window shoppers" and active online purchasers; with one-half (49.4%) of online shoppers researching and making purchases online, while 50.6% "window-shop" only. Popular online "window shopping" activities are: researching and comparing features of different brands (54.5%), comparing different retailers to find the best price (52.3%), and finding the closest store location to make a purchase (33.3%). Men are more likely than women to say they use the Internet to research and compare features of different brands (56.9% vs. 52.1%).

Use of the Internet as a research tool varies with household income: All age segments shop online, including the oldest segment (65 years+), of which 62.6% use the Internet to shop. Use of the Internet as a shopping tool increases with household income (HHI), rising from 62.3% among respondents reporting HHI less than $35,000, to 73.1% of those earning between $35,000-$74,999, and peaking with respondents reporting HHI of $75,000 or more (81.6%).

Security concerns are the biggest impediment to online shopping, but logistical concerns also factor into the decision: Seven out of ten online shoppers (70.7%) cite credit card security as their greatest concern when shopping online. The privacy of personal information is also a concern of online shoppers (60.8%), and is a greater concern among women than men (63.2% vs. 58.0%). Other concerns preventing people from purchasing more online are: shipping costs (64.6%), product quality issues (52.4%), sites' return policies (45.9%), shipping issues and/or delays (45.8%) and product availability (34.8%).

"Consumers are flocking to the Internet and the web is now an integral part of their holiday season shopping," said Jarvis Coffin, CEO and co-founder of Burst Media. "While spending plans for the holiday season may be lower, the Internet retail space will still experience a huge influx of holiday consumers and their spending dollars. It is critical for marketers to understand how to effectively use their ad dollars to maximize awareness and capture consumers' attention during the coming months."

About Burst Media

An online media and technology company founded in 1995, Burst Media (www.burstmedia.com) is a leading provider of advertising representation, services and technology to independent Web Publishers. Burst Media levels the playing field for these independent web publishers and enables advertisers to reach finely segmented, engaged consumers as they visit Burst's extensive number of interest-based sub-channels. Through its Burst Network and Burst Direct offerings, the company represents the broadest and deepest number of interest-based websites online. Burst also markets its ad management platform, AdConductor ™, which empowers content web sites, online ad networks, and web portals to manage the complete process of ad sales and service. Burst Media is headquartered in Burlington, Massachusetts, with offices throughout the United States and in London, UK. For more information, visit www.burstmedia.com or call 781.272.5544.

Source: Business Wire

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