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Study: European Online Buyers Growing at Fast Clip

12 Jan, 2003 By: Joan Villa

More than 100 million Europeans use the Web to research product purchases, including DVDs and videocassettes, and the 40 million who actually buy online regularly are growing at a brisk clip.

These new consumers search for bargains, demand fast delivery and don't hesitate to switch retailers to find what they want, according to a new study of online habits by Forrester Research.

The report shows that early last year there were more people shopping the Web than there were new users signing up for Internet access. In the first six months of 2002, Net shopping grew four times faster than online access in seven European countries, jumping from 18 percent to 22 percent -- a 22 percent growth rate -- compared to online access's increase from 44 percent to 46 percent, reflecting 5 percent growth, revealed the study headed by lead researcher Reineke Reitsma.

The shopping surge is attributed to Web users taking about 18 months to gain experience and feel comfortable enough to buy online, Reitsma said. But once they do, they use the Web assertively, often to research a variety of products that they intend to buy either online or offline. In fact, the study concluded that the Net drives offline sales, because 26 million Europeans bought in traditional stores after researching online first.

“The good news for click-and-brick retailers is that these consumers are hot prospects, fully ready to buy when they reach the offline store,” Reitsma said. However, “48 percent of cross-channel shoppers defect to a competitor store between online research and offline purchase,” she added.

Video is very much a part of the trend, ranking as the sixth most popular online purchase. While 15 percent of European Web shoppers bought a VHS or DVD title online within three months of the survey, up from 13 percent a year earlier in 2001, nearly 31 percent used the Web to research a movie purchase. And online video purchases were among the three top 10 Web categories to experience growth in online buying in 2002.

The top item purchased online was books. In second place were four categories: music, clothing, event tickets and leisure travel, each claiming about 16 percent of online shoppers' spending. Software, hardware, video games, gifts/accessories and toys rounded out the top 10.

Using 22,638 respondents in seven markets -- France, Germany, Italy, The Netherlands, Spain, Sweden and the United Kingdom -- contacted during spring 2002, the study analyzed consumers' shopping habits and found that 22 percent of Europeans have shopped online at least once. Regular online consumers, or those that made at least one purchase in the past three months, represent 17 percent of all Europeans, up from 14 percent a year ago, the report found.

The typical shopper in Northern Europe is still young, male and well-educated -- most likely a professional with a higher-than-average income. Regular online shoppers cite convenience, price and availability as top reasons to buy on the Web, but they tend to be bigger consumers than their peers overall and also spend more than average in traditional stores, the study concluded.

The United Kingdom has the highest penetration of online shoppers, but Germany wins on numbers, with almost 16 million regular online shoppers, the report revealed.

In the United Kingdom, for example, 53 percent of the population has online access, and 54 percent of those consumers actually purchase on the Web, out of the 85 percent who conduct product research online. Spain has the biggest gap: While 24 percent of the country is online, only 15 percent use the Web for shopping.

The biggest challenge to all online stores is consumer defection, Reitsma said, as 48 percent of respondents admitted to buying offline from a different company to the one they used to research the product online. In the Netherlands, where most big online retailers have no brick-and-mortar stores, the defection rate reaches a high of 75 percent.

These cross-shoppers also are sensitive to the perception of Net security and feel less comfortable spending money online, she said. Credit-card security issues are the second most common reason for researching, but not buying, online. The No. 1 reason most say they'd rather wait to purchase at a store is because they want to see or feel the item.

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