Convenience, Not Price, Drives Online Holiday Shopping

Online shopping’s primary appeal is its convenience - the ability to shop anytime during the day - according to 81 percent of nearly 1,000 respondents to the Nielsen Online Pre-Holiday Survey, which was fielded online, reports MarketingCharts.

Saving time was the next most popular reason to shop online, with 77 percent of respondents saying so, followed by the ability to comparison-shop and find things easily - cited by 61 percent and 56 percent, respectively, according to the survey (pdf).

Only a minority of respondents, 46 percent, listed low prices as a reason to shop online rather than in-store. Even fewer respondents, 24 percent, cited low shipping costs.

“Coming into the holiday season, retailers are keenly focused on promotions, which certainly have the ability to move the needle in the short term,” said Ken Cassar, vice-president, industry solutions analytics, Nielsen Online.

“In the long run, however, convenience keeps people coming back to the internet during the holiday season. It’s available whenever consumers are ready to shop, offers a wide selection, and obviates the need to fight the crowds at the mall.”

Online Share of Holiday Budget

Respondents said their 2007 online holiday spending would make up about the same share of their total holiday budgets as in 2006 (see table):

• 35 percent of respondents, the largest group, reported they will spend 25-50 percent of their holiday budget shopping online.
• 33 percent of respondents expect to spend less than 25 percent of their overall holiday budget online.

“The fact that consumers expect to allocate the same share of what may be a shrinking overall holiday budget to the web suggests that online sales growth may not live up to the 20 percent annual growth rates we have seen in years past,” Cassar said.

Favorite Retailers

Among the most heavily trafficked online retailers, Dell was ranked as the highest in customer satisfaction, with 79 percent saying they were “very satisfied” with their experience.

Barnesandnoble.com and Netflix followed close behind, with 77 percent of respondents saying they were “very satisfied.”

(See table of online retailers’ customer-satisfaction rankings.)

Category Trends

For those looking for gift ideas, the pre-holiday survey found that the gifts most people would like to receive include those in the following categories:

• Apparel, shoes, accessories
• Home electronics
• Books
• Gift cards

Compared with their 2006 spending, online holiday shoppers expect to increase their spending the most in the toys & videogames and gift certificates & cards categories.