omnishopping in the connected world - criteo · 2019-12-18 · 7. section 4 lessons for consumer...

Omnishopping in the Connected World

Consumer Electronics Category Analysis

2.

Executive Summary

Consumer Electronics (CE) is a category where the term “omnishopping” strongly applies. With a diverse array of products that enhance entertainment and productivity for home and work lives – everything from micro chargers to refrigerators – shoppers in this category make informed decisions about the purchase across channels and devices. Shoppers often go online to research, but then want to experience a complex product like a 4k UHD TV in a store. Mobile phones are both a defining product in the category, and the device that people increasingly use to buy products. Electronics stores are becoming more like showrooms that encourage shoppers to purchase online, and also convenience centers for those who choose to buy online and want ease of pick-up.

To better understand the influences on and behaviors related to shopping in Consumer Electronics, Criteo conducted a US survey of 2,500 buyers in key product categories: The Shopper Story. The survey focused on omnishoppers: people who research online but sometimes buy in-store but also do the reverse: see something in-store that they buy online. These people spend on average 22% more online than single-channel shoppers and 3% more in stores. The CE respondents had spent a minimum of $200 in the past three months. Criteo also analyzed data from its Sponsored Products network of leading US sites that sell electronics (Walmart, Best Buy, Target, Newegg) to uncover patterns in how people shop, and which products in CE they search.

$251

51%

Free return shipping is as important as discounts for determining where to purchase online.

People buy expensive CE products from their phones: one week before ChristmasCE carts converted on mobile.

FAST FACTS

Peak holiday average unit price on November 11, a week earlier than last year.

of Consumer Electronics buyers do NOT buy from the first website they visit.

3.

SECTION 1

Category Trends:Embracing the New

Here are a few of the CE trends Criteo sees emerging from product searches and the market overall:

• The leap into VR continued this holiday due in part to the release of more affordable headsets from companies like Samsung and Occulus as well as to the increasing amount of content available.

• In smartphones, Samsung and Apple both have new releases and it’s a battle for whose camera has more megapixels and what is being called the “zero edge screen“.

• 8K has been introduced, but the upgrade cycle in TVs is around 4K, with many models well below $500.

• Microbooks and combo tablets like the Microsoft Surface Pro will become more the norm.

• With the rise in Natural Language Processing and artificial intelligence, who needs Cinderella when you can command everything from TVs to Hoovers to refrigerators with voice activation? Frustrating remotes may end up in the trash as smart devices like the Chromecast, the Fire Stick and Apple TV make finding your favorite stream just an ask away.

• Every house now needs a hub. It used to the be the router, it’s now a smart device as consumers crave simplicity and a product that will control other devices. Amazon, Microsoft, Apple and Samsung all have smart speakers so shoppers will be deciding which connected home ecosystem to buy.

• Nostalgic Tech: While homes are expected to get more like the year 2020, there’s the contrasting trend of Millennials and Gen Z going retro with audio and photo. Turntables and portable phonographs are hot again. Polaroid and Fuji Instax are back in the instant photo market and Kodak has re-introduced film like Ektachrome for new camera enthusiasts (trained by their smartphones).

4.

SECTION 2

Category Trends:Omnishopping in Consumer Electronics

With some high relative price points and many complex details, CE tends to be a highly-researched product category. People compare details, availability and prices across sites, devices and channels. The Criteo Shopper Story survey revealed the breadth of omnishopping behavior among recent Consumer Electronics purchasers.

look forward to shopping in stores when they have time

prefer to do most of their shopping online

The most common ways that people shop across channels are “click and collect,”“Webrooming,” (researching online and buying in store) and “Showrooming” (see in store and buy online).

Omnichannel Shopping is The Norm (percent of total—frequency of cross channel purchasing)

17

25 63

63

75

12

21

45

563311

17

15

38

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Regularly On Occasion Never

Order goods online and pick them up in a retail store

Browse products online and then purchase them in a retail store

Make purchases online after seeing the product at a retail store

Make purchases on my phone from within a retail store on another retailer’s site (Amazon, etc.)

Make purchases on my phone from within a retail store from that retailer’s website

10

Source: Criteo Shopper Story, US, 2017

5.

Consumer Electronics omnishoppers were asked about what most influenced their purchase at three key stages in their shopping journey: First learn (awareness), go to learn more (consideration) and last influence (point of purchase). Websites and apps had the greatest impact for omnishoppers at every stage. While many marketers continue to rely on traditional advertising, the purchase – even if it is made in a store – is determined by online activity for these valuable shoppers.

CE is a highly competitive category and there is a high degree of cross-shopping, both within a retail site and across sites. What makes them switch sites? It’s not just price: 34% say they wanted better selection, and 24% wanted more information. With so much cross-shopping, it’s no surprise that in Consumer Electronics persistent carts are important: 25% of shoppers put items in carts without purchasing the item right away.

Websites/Apps (Net) Retail Stores Advertising (Net) People in Real Life (Net) Social Media (Net)

First learn Learn more Influence at

purchase decision

100%

80%

60%

40%

20%

0%


Online is the Key Influence for Customer Electronics Omnishoppers (influences on the purchase (percent of total): How did you...)

6.

SECTION 3

What are they looking for?

When you look at the list of the top terms searched within the past two holidays for CE, they reflect a mix of old and new technologies.

New launches dominate in both years, with Xbox One and the iPhone X rising to the top of the 2017 list.

Classic gift items are also popular, with many gaming systems and accessories, headphones and wrist devices – both of the Apple and Fitbit varieties – present. Drones and hoverboards continue to be popular holiday items.

Finally, CE staples likes laptops (#1) and TVs appear several times in different forms (smart TV vs. 4k TV).

Holiday Research Nov 2017Holiday Research Nov 2016

laptoptv

Nintendo Switch

PS4Xbox One

smart tv

PS4 gamesheadphones

Notebook

hoverboardiPhone X

Fitbit

PlayStation 4iPhone 6

4k tv

iPhone 7Xbox One XNintendo

printerSamsung tvXbox One games

droneXboxApple Watch

wireless headphonesiPhone 8iPad

Super Nintendo Classic

Onelaptop

tvNintendo Classic

Nintendo3DS2DS

Xbox Onesmart tv

laptopsPS4

headphoneshoverboard

FitbitcameraiPadspeakerdroneKeurigBluetoothvacuumMinecraftTalkphones

tablets

Source: Criteo Sponsored Products network

7.

SECTION 4

Lessons for Consumer Electronics from Holiday 2017

Since Q4 is the biggest season for Consumer Electronics sales, it’s important to look at the behaviors gleaned from Criteo’s online purchase data in 2017.

With the rise of omnishopping, people can buy anywhere, anytime, and they do. Research for all products begins as early as August, because it’s so easy to do online. The number of people browsing from November through Cyber Week had minimal growth: 1.5%. In contrast, the number of people who bought had a much bigger increase. The difference between these numbers indicates they had “pre-shopped” online or in stores before the big days. They converted as deals were triggered: the average increase in purchasers throughout the period was 7.7% with days like Thanksgiving (+25% YoY), Black Friday (+13%), Cyber Monday (+13%), and Black Saturday (+12%).

Ecommerce is changing the seasonality and shopping patterns of retail due to its 24/7, always-on nature. The days that had the biggestyear-over-year growth in the number of purchasers occurred earlier in November. There was a post-Election year pop on 11/7 –11/9 of (+50 %) and 11/13 – 11/15 when major retailers triggered deals early to get a jump on Amazon with price-sensitive shoppers.

Change in Purchasers YoY

11/13 11/14 11/15 11/16 11/17 11/18 11/19 11/20 11/21 11/22 11/23 11/24 11/25 11/26 11/27

29%

16%

22%

10%

25%

13%

-10%

The Thanksgiving mobile commerce phenomenon

CyberMonday

Waiting for Cyber Monday deals

Early Black Fridaysales triggered

Source: Criteo Sponsored Products network data, November/December 2017

8.

But Black Friday and Cyber Monday are huge in terms of the number of shoppers we see as well as the number of purchasers. If you look at the data as compared to the month of October, before holiday truly takes off, you see the growth.

Within Consumer Electronics specifically, sales started to really rise during Black Friday week, with the category seeing the same incredible spike on Thanksgiving Day. Sales on Black Friday and Cyber Monday were nearly the same amount.

Average unit prices show some early peaks (and a high above $250), with dips coming later as hot sales prices took effect.

With Amazon changing consumer expectations to 2- and 1-day shipping – and more retailers matching those delivery capabilities – people are shopping closer to Christmas, as seen by the upticks in the days just prior.

Change in Purchasers vs. October 2017

11/23 11/24 11/25 11/26 11/27 11/28 11/29 11/30

CyberMonday

Black Friday

PurchasersShoppers

3.03.4 3.4 3.3

2.32.12.32.4 2.11.9 1.8

3.12.8

6.25.7

7.5x



9.

While the trends fluctuate throughout the season, unit prices on mobile are generally lowest, for the second year in a row. The likely culprit is omnishoppers who have done their research, and are ready to pull the trigger when a perceived price threshold is crossed. Prices on tablets stay highest for nearly all of November and December.

Prices on Mobile are Lowest(average unit price)

Mobile Tablet Computer

11/1

11/3 11/5

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5

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7

11/1

9

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9

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$300

$280

$260

$240

$220

$200

$180

$160

$140

$120

$100

Consumer Electronics Holiday Sales(revenue and average unit price)

$300

$250

$200

$150

$100

$50

$0

11/1

11/3 11/5

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9

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1

Sales Revenue



10.

SECTION 5

Optimizing CE Commerce

From what Criteo data shows, there are key techniques to increase conversions in this omnishopping world:

Understand the increasing importance of free return shipping The hassle of returns is probably the last major impediment to the sale and free return shipping ranks even higher than discounts as a factor in determining where to buy online. There is a cost/benefit involved as this is an expensive challenge for retailers in a category with large items. In store returns for goods bought online solve the cost issue and can provide another opportunity to upsell.

Bring the products to life This is the category that invented online demos and consumers have high expectations. 77% of Consumer Electronics omnishoppers say videos are important. 89% say something as simple as more appealing product photos can make the difference.

Importance of Factors on Websites (percent of total)

Free return shippingDiscounts available

Appealing photosProduct reviews organized with the most relevant first

Website optimzed for mobile devicesWebsite has many unique products

360° product imagesWebsite shows how the products can be used

Videos of product usage/demonstrationsProduct recommendations based on my purchase history

The retailer has a specific appOnline chat so i can communicate with a real person

Very Important Somewhat Important Not Important

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

686447444934283440252121

5589917181821273538

48


5448

39

4144

4842

4745

3227

11.

Optimize reviews to make the sale 91% of omnishoppers say reviews ranked on relevance are important. That’s great news for brands selling on retail sites, as it means that shoppers put a high value on the retailers and other shoppers to validate the items under consideration. Brands should leverage Sponsored Products to reinforce their products during this crucial search for information.

Increase the “genius” level of in-store personnel This is a category where consumers hop back and forth between online merchandise and in store purchase. Consumers may very much want to test that TV and smart fridge in-store. 42% of omnishoppers said that knowledgeable salespeople were a top reason to shop in-store – close to the 50% who value discounts.

Make sure the campaign extends through the full length of the purchase cycle Consumers spend considerable amounts of time on the highest price point items. Make sure you are in market to sway them throughout their shopper journey, which so often goes beyond the standard 30-day window.

Facilitate cross-purchasing According to the Criteo Shopper Story, 54% of purchases in Consumer Electronics are made on impulse, which is excellent news for CE brands. What it means, especially during Festive Season, is that shoppers are open to purchasing goods that aren’t on their list. Criteo Sponsored Products enable CE brands to cross sell to encourage shoppers to buy the protective case with the mobile device and the cables with the television.

Create the online version of in-store display For Consumer Electronics, with so many competing products in subcategories like TVs, Tablets, Smartphones and Wearables, visibility on the site is crucial. Criteo Sponsored Products draw attention to goods in a way similar to displays in electronics stores.

Reach the shopper, not the device or channel Activate your CRM data with Criteo to ensure a seamless consumer shopping experience across devices. And, with Criteo Shopper Graph, you can focus on people-based vs. device-centric marketing efforts. Fueled by three types of granular shopper data, Criteo Shopper Graph pools identity data from 700 million active online shoppers who use multiple devices to shop, and over 10,000 global websites that share their data with us. It’s the ultimate enabler of omnichannel marketing. It’s the ultimate enabler of omnichannel marketing.

Take advantage of the breadth of Criteo offerings Criteo offers a full suite of performance marketing products for brands and retailers. Reach your customers with the most relevant ad experience. Criteo Sponsored Products increase product visibility as busy shoppers sort through thousands of options across retail sites. Brands benefit from the lift in sales, retailers from the incremental revenue. Criteo Dynamic Retargeting can not only recommend the best offer from your entire product catalog in real-time — serving up personalized ads for maximum sales — it can also drive shoppers back to your site once they’ve wandered away. We keep your products top-of-mind when they’re ready to buy. Getting shoppers what they need and love?

It’s what Criteo does best.

12.

About Criteo

To learn more about how the Criteo Commerce Marketing Ecosystem drives sales and profits for thousands of brands, retailers, and publishers worldwide, visit criteo.com/about.

Contact us at [email protected]

omnishopping in the connected world - criteo · 2019-12-18 · 7. section 4 lessons for consumer...

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