Web impacts furniture buying habits
By Kay Anderson -- Furniture Today, December 25, 2005
The Internet has become an integral part of the economy. That's a not-so-surprising conclusion from a new report issued by the Census Bureau in October.
But before saying "duh," consider it took 18 years for color TVs and PCs to make their way into half of American homes. By comparison, it took only five years for more than of Americans to hook up to the Internet.
Americans have always liked new gadgets, but this one has been adopted faster than the speeding bullet that Superman could outrun. The effects on America's shopping habits have been dramatic and far-reaching and marketers ignore them at their peril.
In 2003, the Census Bureau reports that 55% of U.S. households had Internet access, up from only 18% in 1997.
Furniture¦Today's own Consumer Buying Trends survey shows that even more households planning to buy furniture that year had Internet access, an average of 67%.
It was only 1995 when eBay and Amazon launched their first Web services. In the second quarter of 2005, the Department of Commerce estimates that 2.2% of all retail sales took place online.
Cambridge, Mass.-based Forrester Research expects e-commerce will represent 13% of total US retail sales in 2010.
A Harris Poll conducted in November 2004 revealed that 38% of Internet users go online "often or very often" to gather information about products and services and another 38% "sometimes" do. As for shopping online, 16% say they shop online "often or very often" while another 31% "sometimes" do.
The numbers are sure to increase as Internet technology continues to improve. By 2010, 62% of U.S. households will have broadband access to the Internet, according to Forrester. The faster load times offered by broadband will offer more opportunities for better visual presentations of furniture — for example, detailed three-dimensional representations of furniture and floorplans showing furniture in the consumer's own room.
It's not just jewelry or electronics or books that consumers are going online to find out about either. Today, when a consumer googles (already a verb and a company on the NASDAQ) furniture, no less than 87 million sites turn up, offering a plethora of choices. The impact of the Internet is enormous, even if consumers want to perform the "sit test" at their local store.
In the fourth quarter of 2004, 11.7 million shoppers researched furniture online before making a purchase at a local store, according to Milwaukee-Wis.-based Dieringer Research. These online researchers wanted to:
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save time shopping
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form opinions about products
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decide which stores to visit
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determine how much to pay
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save money at stores by identifying discounts
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check store inventory for availability
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find driving directions to stores
Overall, Dieringer estimates 76.4 million U.S. consumers made offline purchases impacted by online information during 2004, up 27% from the prior year. Called Web2Store shoppers, Dieriner's research shows they are serious shoppers — 75% of shoppers who researched home furnishings (furniture, accessories such as lamps and wall art, as well as home textiles) online said they had made a local shopping trip within the week following their online research.
The Dieringer research also underscores the need for retailers to have their own Web sites — 82% of Web2Store consumers checked out retailers' sites before heading to the store.
In a time-pressed society, consumers use the Internet to short-circuit the process: a Harris poll conducted in June 2005 found that 43% of online adults consulted an online search engine to find a local store from which to buy a product. And 74% used a search engine to learn more about a product before they set out to buy.
"Businesses are debating their online strategy," said Carrie Johnson, vice president of Forrester Research. "Many believe they became too focused on sales. Now they're looking at their Web sites as a way to drive in-store traffic and increase their engagement with customers.
Johnson said this represents a huge shift in philosophy as e-commerce enters a more sophisticated phase. "But it's also creating tension as CEOs demand ROI for expensive Web sites with hard-to-define metrics such as loyalty and brand."
| Households with Internet access, 2003 | |
|---|---|
| % of households in each group with Internet access | |
| Source: U.S. Census Bureau |
|
| By age of household head | |
| under 25 | 47.1% |
| 25 – 34 | 60.4% |
| 35 – 44 | 65.3% |
| 45 – 54 | 65.1% |
| 55 – 64 | 56.6% |
| 65 and over | 29.4% |
| By race/ethnicity | |
| Non-Hispanic white | 59.9% |
| African-American | 36.0% |
| Asian-American | 66.7% |
| Hispanic | 36.0% |
| By education | |
| Less than high school | 20.2% |
| High school graduate* | 43.1% |
| Some college or associate's degree | 62.6% |
| Bachelor's degree | 76.8% |
| Advanced degree | 81.1% |
| * or General equivalency diploma | |
| By family income | |
| Less than $25, 000 | 30.7% |
| $25,000 – $49,999 | 57.3% |
| $50,000 – $74,999 | 77.9% |
| $75,000 – $99,999 | 85.8% |
| $100,000 or more | 92.2% |
| By region | |
| Northeast | 56.4% |
| Midwest | 53.6% |
| South | 51.7% |
| West | 59.2% |
| Impact of online information on furniture shoppers' interest in purchasing a specific product or brand at a local store | |
|---|---|
| Source: The Dieringer Research Group , 2005 U.S. Web2Store Benchmark Survey |
|
| Much more interested | 41% |
| Somewhat less interested | 43% |
| No effect | 12% |
| Somewhat more interested | 4% |
| Online resources used by home furnishings shoppers for local shopping | |
|---|---|
| % of Web-to-store shoppers using prior to local shopping trips | |
| Home furnishings shoppers include consumers shopping for furniture, accessories such as lamps and wall art, and home textiles, such as beddings, towels and linens. Examples were given for "Major Web search engines" (Yahoo, Google, MSN), "E-commerce Web portal shopping sites" (Yahoo Shopping, MSN Shopping, AOL Shopping, etc.),"Shopping comparison sites" (shopping.com, pricegrabber), "Popular Web destination shopping sites" (Amazon, cdnow.com, buy.com, etc. ), "Product review or consumer opinion sites" (Consumer Reports, e-pinions.com, about.com) and "Web sites that specialize in local store sale information" (ShopLocal, Cairo, etc.). Source: The Dieringer Research Group , 2005 U.S. Web2Store Benchmark Survey |
|
| Retailer Web sites | 82% |
| Major Web search engines | 80% |
| Manufacturers' Web sites | 53% |
| Mail-order catalog sites | 33% |
| Popular Web destination shopping sites | 32% |
| Shopping comparison sites | 31% |
| Web portal shopping sites | 24% |
| E-mail promotions | 22% |
| Product review/opinion sites | 21% |
| Online Yellow Pages | 21% |
| Web sites that specialize in local store sale information | 8% |
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