In a new survey, Gordon Haskett analyst Chuck Grom dives into consumer spending habits for July 2017. His report reveals that Amazon owns the majority of online traffic (13.7% more purchases than all other e-commerce retailers combined), however in the fashion space, in-store remains relevant and social media plays a huge role in buying decisions.
Below, five major takeaways from the survey:
- Amazon is the clear leader online…In-store remains relevant: Amazon commands the majority of online traffic with an equal (or greater) share of household purchases when compared to all other e-commerce retailers combined. The biggest difference was once again in music, book and movie purchases where 28.8% of respondents said they made a purchase from Amazon in the last 30 days vs. just 15.2% who made a purchase on another site. In other words, Amazon garnered 13.7% more purchases in the category than all other e-commerce retailers combined. Also, worth noting, while apparel sales are split nearly evenly between in-store (54.3% of all sales) vs. online (45.7%). According to survey results, the percent of in-store sales increased sequentially every month since April, with 59.1% of clothing purchases in the last 30 days being made in-store.
- Amazon Prime membership holds steady at 50%: About half of participants surveyed have an Amazon prime membership, however Amazon Fresh and Amazon credit card usage declined in July.
- BUT Prime Is Far Less Appealing To Lower Income Households: According to survey data, even at a discounted rate, Amazon may have a difficult time driving incremental Prime membership in the lower income demographic. To this end, households with a total annual income below $40K were polled, and data found that ~80% of the group is not willing to pay the current $10.99 monthly Prime fee and would still not pay the lowered $5.99 rate available for households receiving government assistance.
- Consumers use Amazon for discretionary purchases more than non-discretionary: Amazon is the dominant e-commerce player, but consumers tend to use the online retailer for their discretionary purchases more than their basic needs.
- Consumers’ purchasing decisions are impacted by social media: According to survey results, about two-thirds of consumers visit a social media website more than once per day with 23.7% of respondents saying they check the sites “a few times a day” and 43.2% visiting “many times a day.” Furthermore, over half of survey takers use social media to research products they are considering purchasing, with 24.9% doing it occasionally and 25.5% frequently. The implication is that connectivity is increasingly important for today’s consumer, and the more ways in which a brand can interact with its customer, the higher the likelihood they can influence the customer at various points in their journey.