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Online Shopping – How it’s Changing the Way Consumers Traditionally Purchase and Act

laptop with shopping trolley on top


14.12.2012

A quick survey of the Auckland office showed that we have all made an online purchase in the past three months; whether it is a BBQ, clothes, shoes (we love shoes), food, make-up… It’s all readily available at our fingertips 24/7.

Just how big is online shopping in New Zealand?

In the past 12 months, New Zealanders have spent $5.6 billion shopping online. Now that’s a lot of shoes!

Whether it is through a mobile app, an online banner, through Facebook promotions, or advertising while viewing a video on YouTube – It’s no longer just a physical threshold, there are multiple doors through which a customer can interact with a business online.

Since the introduction of smartphones, online shopping has simply become easier as consumers now have the option of doing pretty much anything on the go. When out-and-about looking for that perfect pair of shoes, why not whip out your smartphone and find out what the most affordable place to make your purchase? No longer do you have to go home to do your comparative research on the internet, research  in store and compare prices, sales or eStore options. Purchasing from overseas stores (many of which have free shipping) often works out to be not only cheaper, but you are offered more variety than what we have in little NZ .

So where exactly are Kiwis spending their money online? Roy Morgan research shows us that in the past 12 months the five major categories of online expenditure were:
• Travel Products (including tickets and accommodation) – $1.5 billion
• Entertainment and Leisure Products (including tickets, music and DVDs) – $1 billion
• Electronic Products (including home entertainment, computers and software) – $675 million
• Fashion Products (including clothing and footwear) – $405 million
• Food & Beverages (including supermarket and alcohol) – $393 million

42% of people who went on a holiday in the past 12 months used the Internet to book, compared to 18% who booked via the phone and 13% who booked in person.
 
We’re so comfortable with online shopping. Rather than booking through a travel agent it’s become second nature to make online reservations based on the reviews of others. No longer do we trust the uniformed agent, paid commissions to promote one product over the other. Instead we want to hear peer recommendations on  hotels, tours, airlines, etc. from people who have actually been there and experienced it, rather than from someone just trying to make a sale.

Word-of-mouth has become WOLRD-of-mouth as opinions and ideas aren’t just shared amongst your direct circle of friends; social media, forums, Google/review sites and the online stores themselves rate products and services across the globe for free, on the world-wide-web.

• 12% of New Zealanders reading ratings and reviews
• 4% posting reviews themselves, and
• 1.4% saying they have purchased as a direct result of advice from a social network”. – Roy Morgan, 2012.

What do you think? Will advertising become merely brand reminders that build recognition and inform rather than influence consumer choices?

Such easy access is impacting not only how we shop but also how we pay our bills. Why go into your telco or local post office when you can pay the phone bill online? Don’t waste your precious Saturdays waiting in line at the bank for 20 minutes, just to transfer money when you could do it online in less than a  minute?

Business savvy companies will already be online if they want to stay front-of-mind with consumers. And if they aren’t, they need to get their a-into-g and do so quick fast, otherwise they will not be offering the level of service consumers now expect in this ever-evolving digital world.

Google now has the ability to ‘tag’ a qualified lead who clicked on an ad, and follow that prospect around the internet for up to almost a year. This shows that having an online presence driving your brand is paramount in being front-of-mind, not only for consumers, but against your competitors.

Twitter has also developed this kind of technology to provide users with recommendations based on their online viewing habits.

Tracking behavior reveals consumer insights which brands and platforms will use to target users with specific ads. It’s both scary (in a rather stalker type way) and extremely clever at the same time…. So that’s why ads for women’s clothing and shoe stores keeping popping up!

With the growing popularity of online shopping, purchasing vouchers and the ease of agent-free bookings, are shopping malls and travel agencies going to become things of the past?
 

Written by:
Kristina Lindsay, Advertising Executive
Andrea Conell, Advertising Executive
Sharon Visesio, Advertising Executive
 

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