JupiterResearch Finds Social and Community Network Sites Have Little Impact Influencing Online Retail Sales

Business Wire, July 2, 2007

NEW YORK -- JupiterResearch, a leading authority on the impact of the Internet and emerging consumer technologies on business, has found that despite the growth of social networks and online communities, they have little effect on influencing online retail sales. Outlined in a new report, "US Retail Consumer Survey, 2007," social and community sites are only driving about 12 percent of online shoppers to buy more than planned.

The effectiveness of social and community sites, like MySpace, in driving retail sales is still emerging. Because 53 percent of online shoppers go directly to the retailer website while they are shopping, in contrast to the only three percent utilizing blogs, it's clear online shoppers continue to seek out direct access to locations where they can purchase a product or the source of that product when researching and purchasing both online and off-line.

"From a branding and advertising perspective, social and community sites are garnering a great deal of influence online," explained Patti Freeman Evans, Senior Analyst with JupiterResearch. "But when researching a product online, shoppers are looking for fundamental information, not entertainment or social interaction. In the end, the consumer is still interested in convenience and efficiency and social and community sites are just not that efficient."

According to the report, social and community sites help reaffirm purchase decisions as 29 percent of online shoppers say they make better decisions after using these sites. Yet retailer must also manage their expectations with regard to incremental sales potential. In this increasingly competitive retail market, those that use an affiliate model will maximize opportunity with appropriate social and community sites.

"There is a propensity to gravitate toward what is considered to be the latest and greatest method of getting noticed without knowing for certain that this particular tactic will work," said David Schatsky, President of JupiterResearch. "Retailers would be better served to take a step back and evaluate how effective tactics really are - and with whom - to make a stronger impact with the right audiences rather than succumbing to trends."

The complete findings of this report are immediately available to JupiterResearch clients online at www.jupiterresearch.com. For details on JupiterResearch's methodology, visit www.jupiterresearch.com/bin/item.pl/methodology or email press@jupiterresearch.com to request a detailed methodology statement. For additional information on this report or JupiterResearch's Retail research service, visit www.jupiterresearch.com or contact Kieran Kelly, Senior Vice President of Global Sales and Client Service, at 1-800-481-1212 or researchsales@jupiterresearch.com.

About JupiterResearch

JupiterResearch provides unbiased research, analysis and advice, backed by proprietary data, to help companies profit from the impact of the Internet and emerging consumer technologies on their business. The company helps online businesses make critical decisions about technology selection, spending, staffing, and Web site effectiveness; advises consumer-facing companies with online advertising, marketing, and customer service strategies to understand, attract, convert and retain customers; and guides technology vendors and service providers on market opportunity, positioning, product definition, and pricing. JupiterResearch is headquartered in New York City and has offices throughout the US and Europe. For more information, visit www.jupiterresearch.com.