Pre-Purchase Online Research and ‘Social Shopping’: Keys to Driving Sales

By Allan Pulga

The Internet is supplementing people’s shopping knowledge like never before; studies have shown more consumers are researching online prior to purchasing consumer electronics, including cellphones.

A joint Consumer Electronics Association/Yahoo! Study found that nearly eight out of ten consumers used the Internet to research or purchase consumer electronics (CE) products. Janet Pinkerton of Dealerscope magazine reported that the survey asked consumers about the paths they took to purchase five specific CE products: cellphones, computers, digital cameras, MP3 players and TVs.

Apparently the resources people consult to research their purchases haven’t changed much over the past five years, but the volume researching online has definitely gone up.

“Five years ago, household (Internet) penetration was in the mid-40s, and even from the beginning a lot of people were using the Internet to research products,” said the study’s director Tim Herbert to Dealerscope. “(Now) household Internet penetration is approaching 80 per cent and consumers have more opportunities to tap into resources on the Internet.”

The study found that cellphone buyers consulted the following resources before purchasing a product, from highest to lowest: friends/family, retail sales staff, search engines, retail store displays, manufacturer websites, spoke with current owner, retailer websites, reviews (e.g. consumer reports), TV ads, and magazine/newspaper ads.

Of those top ten pre-purchase resources for cellphones, the Internet applies to three (search engines, manufacturer websites, retailer websites) or four (reviews, if online).

Another joint study, conducted by Yahoo!/comScore, found that many shoppers use e-mail, instant messaging and social networking sites to talk about brands, products or categories they like to buy and thereby influence other consumers to purchase them.

This “social shopping” study found that:

• The Internet has significantly influenced how consumers talk about and recommend brands.
• Word of mouth, one of the most trusted sources of information, is amplified online to reach significantly larger audiences.
• “Brand Advocates” have emerged online as primary influencers, with at least a two-to-one rate of converting an actual friend or family member to buy the same product or brand.
• Brand Advocates are incredibly valuable to marketers because they are better connected consumer with a larger sphere of influence.

These studies indicate that as more people turn to the Internet to inform their purchasing decisions, manufacturers and retailers need to make sure they are taking the necessary steps to “acquire” these potential buyers. Are people talking about your product/store online? If not, what can you do to generate online buzz about your business? And if so, how can you increase the number of people consulting resources that benefit your business?