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Do online retailers have a better chance of beating the global recession than their bricks-and-mortar counterparts?
It's no secret that consumers are cutting back big time. Frugality is the new chic. Tight budgets and high fuel prices are leading to an increase in cocooning that can't be wholly attributed to bitter winter weather. Even New York City is reporting subway ridership has scaled back to levels not seen since the 1950s, as workers lose jobs and shoppers don't leave home to shop.
Hard to find bright spots in such scenarios, but grim economic times could bode better for online retailers than their beleaguered meatspace counterparts. A recent Penn, Schoen & Berland Associates survey finds 26 percent of consumers saying they'll shop more online if their personal financial situation worsens in the coming year.
These so-called "recession shoppers" aren't just buying online to save shoe leather and tire treads. They're hunting for rock-bottom prices, deep discounts and solid deals.
Most of all, recession shoppers love coupons.
- 68% of "recession shoppers" (and 79% of "weekly shoppers") purchased something online they wouldn't have otherwise because of a coupon or discount.
- 64% of "recession shoppers" (and 70% of "weekly shoppers") said they purchased something from a particular online retailer they wouldn't have otherwise because of a coupon or discount.
Additional findings include:
- 74% of online shoppers receive e-mail alerts from their favorite retailers
- Recession shoppers are 17 points more likely to research products or services online several times a week than average users
- Consumers - 34 year olds make more online purchases every month than any other age group
- 34% of those surveyed plan buy more online in 2009 than they did last year
While on the surface these findings would seem to bode well for online retailers, there are more than a few caveats and unknowns tied up in the findings. Where's the ROI? Where's the customer loyalty?
In short, are recession shoppers the customer segment retailers should work, and spend, to attract during tough times? Sales are sales, and orders are order. But the bottom line is still the bottom line, and profit matters. Navigating the treacherous waters of a recession is hard enough without being held hostage by customers insisting on ever-deeper discounts and ever-sweeter deals before they'll hit that 'buy' button.