A Tale Of Two Consumers - online shopping - Statistical Data Included

American Demographics, Sept 1, 2001

The study carves online shoppers into six segments: Hooked, Online & Single (which Harris estimates at 16 percent of total online shoppers), Hunter-Gatherers (20 percent), Time-Sensitive Materialists (17 percent), Brand Loyalists (19 percent), E-Bivalent Newbies (5 percent) and Clicks & Mortars (23 percent). According to eBates' Isolani, four of the six Harris segments fall neatly into either the Bargain Hunters or Convenience Shoppers categories. Here's a profile of which segments fall into which group.

BARGAIN HUNTERS

The groups classified as Hooked, Online & Single and Hunter-Gatherers (which together account for 36 percent of all online shoppers) are most likely to agree with the statement: "If it's the lowest price, I'll buy from a company I don't know." They are also the most likely to "compare prices of various merchants" and to "use the Internet to figure out exactly what product they want."

According to Harris, Hooked, Online & Singles are mostly 18- to 29-year-old males who earn between $50,000 and $90,000 a year. They are by far the most technologically sophisticated users and spend $120 a month online, the second-most of all the segments. They like auctions and tend to buy from almost every product category. They've been online for five years on average, and started cyber shopping two to three years ago. They are discriminating consumers who value high-end products. And, like Chris Nolte, they play ball with coupons, rebates and other discount offers. Flexo Hiner & Partners, a market research company based in Long Beach, Calif., calls this group e-discounters - affluent folks, mostly male, who are well-educated and early to adopt new technology.

Hunter-Gatherers are older and more price-conscious. They tend to be married, between the ages of 30 and 49, with children in the house. Hunter-Gatherers resemble the general population, and therefore are less tech savvy. At the time of the survey (June 2000), they had made their first purchase online only six to 12 months before. They tend to use fewer coupons and rebates and seldom visit price comparison sites, like MySimon or Bizrate. But they're still relatively fearless online. They don't mind going to sites they don't know, and don't worry about the hassle of making returns.

Hooked Online & Single and Hunter-Gatherers do not go uncourted online. The many sites and services that cater to price-sensitive shoppers are evidence of their proliferation. Dozens of e-mail notification services, such as SmarterLiving.com and Colonize.com, fill inboxes with the cyberspace version of direct mail coupons. "Price is a tangible way to differentiate among offerings," says Steve Hans, associate vice president of brand marketing at MySimon, a company that trawls the Net for products that it lines up against each other to save bargain shoppers time.

Price competition obviously doesn't help any company's margins, but it's a natural byproduct of the Internet, says eBates' Isolani. PricewaterhouseCoopers, in a survey conducted during the 2000 Holiday shopping season, found conclusively that, "relative to Internet shopping, savings or a low price is one of the most compelling reasons that consumers shop online."