Reasons why customers shop online
These are some of the most popular reasons people choose to shop online.
As store owners endeavor to create the best shopping experience for their customers, they must identify when and why their target audience chooses an eCommerce experience over other retail methods. It is important for retailers to recognize where they can be competitive in the retail landscape. If they cannot compete with same-day delivery, they may want to focus on customers or situations for which delivery speed is not the deciding factor. Retailers can offer competitive prices and selection and cater to shoppers that do not need the product today.
Ascertaining what their target audience cares about for each product and situation can help retailers understand why they do or do not shop online.
Why Shop Online / Price:
Price will always be a crucial factor for most products or services.
It is easier than ever to discover the store with the lowest price for the desired products.
If a customer is looking for the lowest price but must physically visit ten stores in their local area, they will often forgo this as it is too time-consuming, especially for an inexpensive item. A visit to Google Shopping, Amazon or a quick Bing search can present you with dozens or hundreds of stores selling the desired product, easily sorted by price. This also allows you to search and shop stores all over the country or world, giving you price options you would not have even if you visited all relevant stores in your city.
Many factors impact price sensitivity including the dollar value of the item. If you could buy a one-dollar snack for half price by walking a few blocks to a different store, you may pass because it is not worth spending the extra time to save 50 cents. If you are buying a new car and found out that you could get it for half price by walking a few blocks or even driving a few miles, you would likely be willing to spend the extra time to save thousands of dollars.
Shoppers may also be price sensitive if a similar product was competing against their preferred choice. A commodity item will need to be priced very close to or lower than its competitor to sell when both options are available.
Cost and other product options are two factors that influence how price-sensitive shoppers are regarding a specific product.
Shoppers’ situations have a tremendous bearing on how much they will pay for an item. In an emergency, people tend to be less price sensitive. When a selection of competing stores or other product options are available, the price is much more important. People may also view price differently while on vacation, at a sporting event or on a first date. The options available, the specific situation, or current mental state can each influence how price sensitive shoppers are regarding an item.
Often, people’s degree of price sensitivity does not rely on financial factors. The amount of money a person currently has influences how they think about price, but this is not the only persuading factor. People’s financial situations while growing up, their parents’ views about money or their general disposition all have an influence on the shopper’s price sensitivity. Even within the same culture, people’s ideas will vary at different times, ages and with different experiences.
Technology can produce items for less money and help transport items at a lower cost, and new business models can connect shoppers with the low-cost or better options. New business models, such as Google Shopping, are used to help find low prices. These models along with underlying Internet connections and affordable computers make this possible.
Advancing technology often stimulates new business models to emerge.
Even when retailers do not move ahead technologically, they can continue to come up with better ways of doing business that will reduce frictions and future costs. Business owners copy other models, learn through trial and error, and adopt improved business practices over time so innovation will continue with or without a faster Internet connection for customers or better factory robots. Advanced technologies don’t always bring the price down for the consumer, but in general, competition keeps the prices in check and some of the savings end up in the shoppers’ hands.
Everyone wants a lower price, but people care about it to different degrees at different periods in their life. After the stock market crash in 2008, it became popular for people to show how thrifty they were even if they were well off. This was less of a norm in 2006 or 2016 when more people had more money due to higher real-estate values. As people become more well-off in general, they may still be concerned with price, but for different items or in different situations.
Understanding how price sensitive your customers are regarding the products you sell is important for any business to maximize profits.
Why Shop Online / Selection:
Selection is another key reason people choose to shop online. One store can offer millions of products and the entire eCommerce ecosystem offers hundreds of millions to choose from. No single brick and mortar store or even an entire large city can offer anything close to the selection offered online.
Unlike at online stores, adding additional SKUs (product codes) at a physical store means building a larger shopping area for more products, having a cluttered space, or eliminating current SKUs.
If you skip visiting individual stores, you can start your search on Google and instantly browse much of the web or start at a marketplace such as Amazon or eBay and search thousands of trusted sellers.
Selection is not important for all types of products. Many people want a specific clothing item that fits their style, size, and checkbook. Commodity products such as printer paper are interchangeable and brand is not important. Shoppers who want tomato sauce that fits their exact needs and dietary requirements are not worried about what brand plastic forks the same store may have. Many commodity items do not demand a large selection but products featuring a specific fit, style or use might. There may be thousands of available shoe options but only a few options are necessary for toilet plungers.
A customer’s specific situation will have an impact on how choosy they are as well. When shoppers really need an item, selection will not matter. If it is raining and a store has only one raincoat left, most customers looking for one will not care what brand, color or style it is. When shoppers want or need a product to be perfect, a larger selection may be necessary. Everyone wants their favorite style shoes in the desired color and brand, in the size that fits.
Individual shoppers have different preferences as well. Some people want specific design styles, colors, sizes or ingredients and will settle for nothing else. A vegan will not accept just any menu item and a home decorator will only accept just the right color chair. Other shoppers might not care about food or home furnishings selection but instead, demand a specific bicycle or skateboard.
Knowing which products demand a large selection for your audience will help provide them the best shopping experience and result in additional profit for the retailer.
New business models and the technology that drives them help create shops that not only have a broad offering of products but also a large selection of a particular type of product. A site that sells every pair of basketball shoes ever made would have a very extensive selection while a shop that sells a few shoe options for every sport would likely not offer as extensive of a selection for each sport.
The Internet allows for business models that present both broad and extensive selections of products.
Why Shop Online / Convenience:
Many people would rather make a few clicks sitting on the coach than spend time driving around town stopping at various stores. Other people would love to get out of the house and window browse. Convenience means different things to different people, in different situations, in relation to different products. Both eCommerce companies and brick and mortar stores work hard to make the purchasing of products as easy and enjoyable as possible for their target audience.
Amazon was clearly thinking about this dilemma when they filed the “1-Click” shopping patent. Stores realize that if they are more convenient than their competitors, customers will choose them and spend more each time they shop. Customers love convenience because it saves them time and removes the hassle of remembering what to buy.
Technology lets us shop anywhere, at any time, for anything.
It’s now possible to buy clothing while on the train and a new computer while sitting in the woods. We have come to expect that we can purchase almost anything, anywhere, at any time.
We now have new device inputs inducing screens, voice, scan and usage data. Each of these technologies has the potential, through the appropriate business models, to introduce additional levels of service and convenience to our shopping experiences.
Business features such as same-day delivery, auto-reorder, recommended items, and access to accessories make it easier for shoppers to find what they want and provides a more convenient shopping experience. Auto-reorder is great for items purchased regularly such as food, household disposables, and office supplies. Same-day delivery can save a trip to the store before evening guests arrive and recommended items can help shoppers find the correct battery that will fit a specific toy. Some of the new business features are based on better algorithms that are available due to larger data sets, faster data processing, and innovative machine learning.
As shopping convenience increases, people begin to expect the same type of experience for all transactions.
If Amazon makes it easy to order a soda, book, and computer mouse in fifteen minutes, shoppers may expect other stores to do the same, even if the item is not time sensitive.
Amazon is working hard to make shopping as convenient as possible.
It’s now possible to scan a barcode or product with a phone camera and find the item for sale on Amazon. Click the virtual or physical “Dash Button” to have the item delivered. Order by voice, easily reorder products or just walk out of the physical Amazon Go store with your products purchased online. These are just some of the services Amazon offers or is working on expanding.
Amazon wants customers to be able to scan barcodes of products in their homes and add them to a list. Drones may soon be delivering products. Cashiers may become a thing of the past now that customers can not only grab their food, pay for it online, and walk out of the store, but can also place a physical push-button next to the toilet to order more toilet paper which will arrive in a day or two.
Why Shop Online / Information:
Online and physical stores deliver distinct types of information. The best shopping choice depends on the type of product, the business use case, and the individual shopper. In some situations, shoppers cannot find all the needed information online as they need to see, touch or try on the item to know if it is right for them and feel secure about their choice. In other situations, shoppers can find a great deal more information online about the product they need. Reviews, spec sheets, and in-use videos are often unavailable at brick and mortar stores but are easy to access online.
Online information that may be difficult to get in stores:
● Video of the product in use
● Reviews or testimonials
● Company Information
● 3D renderings
● Multiple-angle photos
● Line drawings
● 3D CAD files
● “Call the expert” advice
● In-home augmented reality
● Frequently Asked Questions
People often demand quality and trusted information for complex, unique, expensive and specialty products.
When shopping for a new car or pair of shoes, customers require a lot of detailed information. Cars are expensive and complex products and shoes need to be the right size and appropriate for their purpose. Paper clips are rather standard commodity items and unless a special size, shape, or material is desired, there is no need for a CAD drawing, tech data sheet or videos about how to use them.
Technology and new business features have helped to lower the costs of creating, transferring, and sharing product information. Now, it’s much easier to find expert advice, user testimonials, photos of products in use and to download CAD files because of new technology and the business built on it.
Why NOT shop Online
Many of the obstacles involved when using eCommerce will change over time as the technology, store models and norms evolve. Here are a few of the reasons people say they choose not to shop online.
● Chance for errors
● Delivery hassles
● Not enough of or the wrong type of information
Every reason behind why people do not currently shop online is an opportunity for innovative stores to fix or eliminate these roadblocks and create new and better shopping experiences.
Why NOT shop online / Anxiety:
The possibility of having your credit card information stolen after putting it in cyberspace is a serious concern for some shoppers. Even if users trust the store or the people that have access to the credit card information at the store they want to shop at, hackers may gain access to the information. Companies large and small have digitally stored data of some sort and even companies such as Target have been susceptible to data breaches.
The fear of hackers, malware, viruses, and other security concerns can be enough for some people to forgo shopping online entirely.
This fear may or may not be a legitimate concern in all cases but it is something that is a very real issue in the minds of some shoppers.
Others worry about not being able to easily return an item if it is not what they wanted. Expensive, non-returnable, breakable or questionable products pose an extra risk for the online shopper.
If the website does not look credible, many shoppers will not trust it. If a company has plenty of reviews, a professional design, or is a well-known brand, it will lower the customer’s fear of giving their credit card information to a person they’ve never seen face to face.
Brand experience or perception translates from the traditional store to the eCommerce store.
Technology is helping to lower the risks, and in turn, the shopping anxiety. New and safer forms of payment and customer identification help ensure that mutually beneficial transactions occur. Business features such as free 365-day returns, third-party store or seller reviews, and credit cards that limit the buyer’s risk encourage more people to feel safe in the new area of shopping. Children who grow up their entire life with an Internet connection and smartphone in the home may not think twice about conducting all transactions online. This new generation will continue to do more of their shopping on eCommerce sites, both at home and for business.
In some areas of the world, people only risk shopping online if they are able to pay using COD (collect on delivery) payments. As stores add this option, many new people will feel safe taking advantage of what online retail has to offer.
Why NOT shop online / Chance for errors:
Even if shoppers do not worry about cybersecurity, they may worry about shopping errors. Will the package be delivered? Will it have a defect? If there’s an issue, can it be returned? What if the wrong color or size is sent? Who pays return shipping? Will I need to go to the post office and stand in line? Do they have a restocking fee?
Shoppers know that they could have just gone to a local store but an online error is an even larger hassle.
Many larger online stores that also have a brick and mortar store gain some advantages as customers can fix errors in person and get a refund and a new product the same day.
Items that need to be perfect, but look the same as others may have a high chance of error.
A computer charger, odd-sized batteries or unique repair parts come with additional risks when ordering online.
Time sensitive-situations can be risky if the product is late or the wrong size.
Shoppers do not want to hold up a constructions crew or receive their wedding tuxedo two weeks late.
Business Features that make service and reliability a priority help to eliminate or reduce retail errors. Both Amazon and eBay have strict rules for their marketplace and encourage sellers to provide reliable service. Customers may become more accepting of the errors because of other online benefits or they may demand better service and stop shopping at retailers that are not top notch.
Why NOT shop online / Delivery Hassles
Having to wait for an item can be a reason to shop at a nearby physical store. For other people, receiving deliveries can be difficult.
A box left sitting on the front porch is not recommended in all neighborhoods or for all items.
Products that can spoil, need to be kept at a certain temperature or are illegal to send in the mail may best be delivered by traditional retail methods. Time-sensitive items, last-minute shoppers or emergency supplies are not always appropriate for traditional delivery methods.
Technology including better analytics software for modeling product demand and new forms of delivery such as drones or robots will change some of the current delivery method limitations. For now, shopping for time-sensitive products online should be avoided unless shoppers live in larger metro locations serviced by Amazon’s two-hour delivery or other similar services. Those living in less than safe neighborhoods will not want larger packages sitting by their front door for half the day.
New technologies such as driverless vehicles and drones will impact how shoppers feel about deliveries and help eliminate some of the hurdles.
Business features such as in-store pickup, lockers, independent services and “deliver to car” are eliminating some of the roadblocks, especially related to last-mile product delivery.
Why NOT shop online / Not Enough Information:
Seeing what you are buying in person first can make a huge difference for many items people want. Does the clothing fit? Is it the right color? What does the fabric really feel and move like? Is this chair comfortable to sit in? What condition is this used jacket really in?
The information desired will depend on the person, situation, and type of item.
For those who work at an online store that sells products people prefer to try on, see in person, or touch, it can be challenging to answer all of the questions shoppers may have.
Purchasing products such as clothing, furniture or artwork may require information best experienced in person. It is difficult to know whether the colors are right or if the suit will really fit.
Technology such as augmented reality creates new ways for the customer to “try” products in the environment where they will be used. In some cases, this new technology gives you more information about the product than you could gather through a brick and mortar experience. The wayfair.com augmented reality app allows shoppers to see items in their house virtually before buying online.
Business Features removing risk by providing better and new forms of information and lowering the risk of ordering the wrong product can influence the amount of information needed or available to make a purchase. Access to hundreds of product reviews and free, no-question returns may both give users more information than they could have gathered previously and also eliminates some of the risk involved in purchasing without additional information.
As customers grow more accustomed to shopping online, their positive or negative experiences will shape what they are comfortable buying with the information available.