While 2011 saw a general increase in online shopping compared to 2010, Internet users are still reluctant to go the e-commerce route when buying Consumer Packaged Goods.
Are Internet users reluctant to go online to do their everyday shopping and purchase consumer packaged goods (CPGs)? Some are, certainly, says a study carried out jointly by the Integer Group, a marketing agency and M/A/R/C Research, a brand development firm. The study shows that only 25% of people who buy on the Internet say they have bought groceries in an e-supermarket. Among the reasons cited for this lack of enthusiasm, first place goes to concerns over product expiry dates, followed by worries about potentially high delivery costs. According to Craig Elston, Senior Vice President of Integer, "Grocery shopping online is a concept most shoppers have yet to adopt, which means there are conventions ingrained in their shopping behaviour that must be disrupted," if such day-to-day shopping is to move online.
Over-40s out in front
Although for several years the younger generations have been in the forefront of online shopping, the study shows that the “baby boomers” are starting to make inroads. According to the study, the age bracket most likely to purchase CPGs is the over-40s. More than half of all 50-54 year-olds shop online for their health and beauty products while 29% of the 45-49 year-olds go online to buy general food and beverage products. According to Craig Elston, these consumers are happy to embrace online purchasing “because they know the products that suit them, especially when it comes to health and beauty products”. Given that one of the prime reasons for buying online is to find a discount deal, “it goes without saying that as more people in this age bracket become Internet-savvy, the more they’ll lean towards e-commerce,” he argues.
Reaching a larger market
Should the primary target market then be the over-40s? Not according to the study. The researchers point out that in 2010 online purchasing increased overall for all age brackets. Young working people should also be targeted. “The flexibility and simplicity of shopping online becomes even more appealing the busier people get,” underlines Randy Wahl, Executive Vice President at M/A/R/C Research. His first advice to e-tailers is to get rid of all delivery charges, particularly those for CPGs. While up to now it’s been seen as a competitive advantage to grant free delivery for online purchases, the scale of free shipping these days means that the few sites still charging shipping costs are now putting themselves at a disadvantage. Randy Wahl concludes:"We believe that manufacturers and e-tailers have the most to gain if they can help shoppers get over their online purchase barriers."