By Tamera Mendelsohn, analyst, Forrester Research
This article originally published in Self-Service World magazine, May/Jun 2006.As online shopping becomes an increasingly mainstream activity, still only the savviest of consumers actively bounce back and forth from the Web to stores.
Today's most experienced cross-channel consumers see shopping as a multistage process, with the online and offline channels bringing distinct value to components of their shopping experiences. The online channel offers myriad rich sources for product research that consumers readily consume and interact with, and stores provide the tactile experience and instant gratification that the online experience will never fully re-create.
Fifty-five percent of U.S. online consumers have cross-channel shopped — meaning they have researched a product online and then purchased that same product offline. This equates to more than 40 million consumers — an 8 percent increase over 2004.
While these shoppers represent both genders proportionately and are only slightly younger than other online consumers, they tend to have a higher education, earn significantly more money and are more likely to embrace technology in their lives than consumers who don't cross-channel shop.
Cross-channel shoppers also are more pressed for time than the rest of the online populace, with 40 percent reporting that they're always pressed for time. This means they'll pay a premium for convenience: Compared to only 25 percent of non-cross-channel shopping consumers, almost 40 percent of cross-channel shoppers are willing to pay more for products that save time and hassles and are more likely to use self-service technologies.
Power Shoppers
So why are cross-channel shoppers important? As these shoppers crossed from the Web to stores, they spent more than $125 billion in brick-and-mortar stores in 2005 — a 23-percent increase over 2004.
Depending on the product price point and complexity, certain categories lend themselves to cross-channel behavior more than others. Cross-channel shoppers research high ticket, commodity items online but buy them offline, in particular consumer electronics, major appliances, and computer hardware. Combined, these categories capture more than $44.5 billion of cross-channel shopping.
Price, immediacy, information and convenience are the primary motivators of cross-channel shopping. Cross-channel shoppers want the right product, at the right cost, and they don't want to wait for it.
Top reasons that consumers research online before buying in a store include the desire to compare prices among different retailers, the need for more information than is available in stores, and the ease of comparing their options without having to trek to five retail locations.
Immediacy was the top motivation for buying in stores, with 47 percent of cross-channel shoppers stating they bought offline because they wanted the product immediately.
While cross-channel shoppers spend big bucks in stores, they're disloyal when they cross channels: 49 percent of cross-channel shoppers report buying their last cross-channel purchase from a different offline retailer than they used to conduct their online research. This brand crossover not only represents the loss of highly qualified and high-spending shoppers, but also a rich opportunity for upsell: $16 billion of the $126 billion that cross-channel shoppers spent in stores after researching online was on products in addition to what they had researched.
How can retailers keep these precious shoppers loyal? Use in-store technologies to meet their demands for content, control and consistency.
Tamara Mendelsohn is an analyst on Forrester's consumer markets team.
