Online shoppers value customer service options and reputation above price and are willing to pay more if they feel they will be getting a good deal overall, according to a new survey from online comparison site GetPrice.
The survey of 3,000 people, which was analysed by research firm CoreData, also found that businesses need to start advertising on mobiles and deliver promotions through social networks, with 47% of users now accessing the internet on their mobiles.
GetPrice marketing director David Whiteman says the survey shows consumers aren’t just thinking about price when they shop online – respondents indicated they take into account a number of different factors, such as customer service levels and a product’s reputation, before they buy.
In fact, the survey shows that customer service options are the most important factor for consumers, followed by familiarity with the brand, user reviews and ratings and cost of delivery. Having the lowest price was only the fifth most important factor.
While 82% of respondents said that price was the determining factor for research products online, 73% said that it saves them time and 67% said it was the easiest way to compare offers. Another 67% said it allows them to shop after hours, and 51% said they do so because they can take as long as they want.
“It’s not all about price,” Whiteman says. “I think it’s quite interesting that there has been a lot of talk about GST, margins and damage down to retailers. But there are a lot of factors here.”
“Retailers just can’t compete on price. People are willing to pay a bit more sometimes, and that’s what businesses need to look at.”
GetPrice chief executive Chris Hitchen agrees, saying consumers value “familiarity with the name and brand… the big guys are conscious about wanting to compete on price, but they don’t necessarily need to be the cheapest offering”.
The survey comes as the Government announced yesterday it will host an online forum dedicated to helping smaller businesses gain a presence online.
The research shows that online consumers are rapidly accessing shopping sites on their mobiles and track brands through social networks.
It found 47% of respondents access the internet on mobile devices, and those that do stay connected to social media when doing so. Just under 25% follow brands on social networks.
The majority of those users accessing the internet on mobiles are aged between 21-30, with 68% saying they do. The next biggest category were the under-20s, with 62% saying they access the internet through mobiles.
Of those that visit sites on mobiles, 51% said they visit social networks, the most popular option. This is followed by 44% visiting news sites, while 30% use mobiles to shop.
Whiteman says the growth of mobiles suggests businesses need to start incorporating mobile tech into their strategies.
“This didn’t actually surprise us that much, but the strength of this segment, and that rate at which it is growing, is pretty rapid. We’re seen that usage now in our own site analytics, and half of our sample are shopping on their phones pretty regularly.”
The survey found 43% of mobile shoppers use an iPhone, with 23% using another type of mobile phone, followed by 18% with another smartphone. Only 7% use a type of Android device.
Hitchen points out that while 30% of smartphone users are using their phones for shopping, only 29% are using mobile search engines.
“The fact that people on mobiles are using retail sites more than search engines is pretty amazing. It could be comparison sites, it could general retailers, but it shows the segment is growing.”
The survey also reveals a large take-up of tracking brands through social networks. About 25% of respondents are tracking companies through sites such as Twitter and Facebook. Males are more likely to do so, with 86% of respondents saying they track brands.
Whiteman says there is a huge untapped opportunity for businesses here to start gaining followers through social networks and deliver them deals or information on a regular basis.
“That figure is actually consistent with what’s coming out of the US. It’s a good number and suggests that people are open to receiving promotional messages or materials from brands, as long as it is relevant and helpful.”
The survey itself breaks down consumers into a number of different categories and sections, revealing a wide range of character traits.
It found 96% of respondents used the internet to research products, while 99% had actually bought a product online.
The survey also found online consumers are heavy users of other mediums, with respondents spending an average of 11 hours per week online for personal use and leisure, 11 hours for watching television, nine hours spent online for work and seven hours spent listening to the radio.
In comparison, online users rarely use traditional mediums, spending an average of two hours every week reading newspapers and one hour on magazines.
Online consumers are 64% female, but are spread across all age groups. About 53% of the respondents are over 40 years of age, and 47% are under 40.
As for household income, 25% of respondents earn under $50,000, but the majority at 41% earn between $50,000 and $100,000. A further 23% earn between $100,000 to $150,000, while only 11% earn above that amount.
More than 70% of online consumers are in the work force, with only 13% saying they are self-employed.
But the survey also repeats some old problems for online retail – shoppers say they usually choose to buy offline because they like to experience a product before purchasing, and many say they require an item immediately, and cannot wait for long shipping times.
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
