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1 February 2008
Auckland
Clothes/Shoes - Fastest Growing Internet Buys
"Visa" the Most Popular Credit Card Payment Method
More than 85 percent of the world’s online population has used the Internet to make a purchase - increasing the market for online shopping by 40 percent in the past two years - according to the latest Nielsen Global Online Survey on Internet shopping habits. Globally, more than half of Internet users have made at least one purchase online in the past month, according to Nielsen.
“The Internet is no longer a niche technology - it is mass media and an utterly integral part of modern life. Almost no aspect of life remains untouched by online media. As our lives become more fractured and cluttered, it isn’t surprising that consumers turn to the unrivalled convenience of the Internet when it comes to researching and buying products,” said Jonathan Carson, President, International, Nielsen Online.
“When The Nielsen Company conducted its first global survey into Internet shopping trends two years ago, approximately 10 percent of the world’s population (627 million) had shopped online,” said Bruce Paul, VP, Customized Research, Nielsen U.S. “Within two years, this number has increased by approximately 40 percent (to 875 million).”
Among Internet users, the highest percentage shopping online is found in South Korea, where 99 percent of those with Internet access have used it to shop, followed by the UK (97%), Germany (97%), Japan (97%) with the U.S. eighth, at 94 percent. Additionally, in South Korea, 79 percent of these Internet users have shopped in the past month, followed by the UK (76%) and Switzerland (67%) with the U.S. at 57 percent.
Globally, the most popular and purchased items over the Internet are Books (41% purchased in the past three months), Clothing/Accessories/Shoes (36%), Videos / DVDs / Games (24%), Airline Tickets (24%) and Electronic Equipment (23%).
Among New Zealand Internet users, 44% said they bought Airline Tickets/Reservations, 33 percent had bought Books and 29% Clothing/Accessories/Shoes and Event Tickets (second in the Asia Pacific region after Australia) in the past three months. Seven percent had purchased groceries.
The number of Internet consumers buying books over the Internet has increased seven percent in the past two years but the biggest increase has been in Clothing / Accessories / Shoes which increased from 20 percent to 36 percent. “Some of the biggest buyers of books on the Internet are from developing countries - China, Brazil, Vietnam and Egypt - indicating massive growth potential for online retailers that can specifically target these fast-growing markets,” said Carson.
Internet shopper interest in buying Videos/DVDs and airline tickets/reservations rose two and three percentage points respectively over the Internet in the past two years - today one in four online shoppers globally said they had purchased these on the ‘Net in the past three months.
More than 70 percent of Indians and more than 60 percent of Irish and UAE Internet users said they bought airline tickets/reservations on the Internet in the last three months, making travel the fourth most popular shopping category on the web.
“Travel is a category extremely suited to the Internet due to the latter’s ability to provide efficient access to an extremely wide range of comparable information. Whilst certain areas of the travel industry were initially slow to utilize the benefits of the Internet, it is now one of the undoubted success stories of online, playing an integral part in the arrangements and experience of today’s traveler,” said Carson.
Payment Methods for Internet Shopping
Credit cards are by far the most common method of payment for online purchases - 60 percent of global online consumers used their credit card for a recent online purchase, while one in four online consumers chose PayPal. Of those paying with a credit card, more than half (53%) used Visa.
Turkish online shoppers (who represent the economic elite in that country) topped global rankings for credit card usage (91%) for online purchases followed by 86 percent of Irish online shoppers and 84 percent of Indian and UAE online shoppers. “Shopping on the Internet with the ease of a credit card is especially appealing to consumers in emerging markets who simply cannot find or buy items they want in their retail trade. The Internet has opened up a whole new world of shopping for these consumers,” said Paul.
While Latam and Asian online shoppers are also more likely to use credit cards than any other form of payment, debit cards are most popular among UK (59%) and U.S. (40%) online shoppers.
Eighty one percent of Kiwi Online shoppers use credit cards - well above the Asia Pacific regional average of 59 percent, with Visa being the most popular credit card (69%).
Selecting Online Shopping Sites
According to Nielsen, online shoppers tend to stick to the shopping sites they are familiar with, with 60 percent saying they buy mostly from the same site. “This shows the importance of capturing the tens of millions of new online shoppers as they make their first purchases on the Internet. If shopping sites can capture them early, and create a positive shopping experience, they will likely capture their loyalty and their money,” said Paul.
In New Zealand, 66 percent say they regularly buy from the same site; matching the Asia Pacific regional average.
In selecting sites on which to shop, one-third used a search engine or just surfed around to find the best online store. One in four relied on personal recommendations.
“Recommendations from fellow consumers - whether they are people they know or fellow online shoppers - play an enormous role in the decision-making process. The explosion in Consumer Generated Media over the last year means that this reliance on word of mouth, over other forms of referral, looks set to increase,” said Carson.
This is also true for New Zealand, were 34 percent relied on personal recommendations.
Chart 1: Internet users who have purchased online
Chart 2: Most Popular Online Purchases
Chart 3: NZ Shopping Categories – Research & Purchase Behaviour for the month of December 2007 – NZ Nielsen Online Retail Monitor 
Chart 4: Top Online Retailers in New Zealand for the month of December 2007 – NZ Nielsen Online Retail Monitor
Source: NZ Nielsen Online Retail Monitor, December 2007
About The Nielsen Global Online Surve
The Nielsen Global Online Survey is the largest half-yearly survey of its kind, aimed at gauging current confidence levels, spending habits/intentions and current major concerns of consumers across the globe. The latest survey, conducted from October to November 2007, polled 26,312 Internet users in 48 markets from Europe, Asia Pacific, North America and the Middle East. The survey is representative of all Internet users aged 15+.
About Nielsen Customised Research
Nielsen Customized Research, operating in more than 100 countries, provides clients with survey research, analytical and consulting services, including measures of consumers’ attitudes and purchasing behavior, segmentation, brand equity, pricing, packaging, advertising effectiveness, customer satisfaction & loyalty and other marketing issues.
About Nielsen Online
Nielsen Online, a service of The Nielsen Company, delivers comprehensive, independent measurement and analysis of online audiences, advertising, video, consumer-generated media, word of mouth, commerce and consumer behaviour, and includes products previously marketed under the Nielsen//NetRatings and Nielsen BuzzMetrics brands. With high quality, technology-driven products and services, Nielsen Online enables clients to make informed business decisions regarding their Internet, digital and marketing strategies. For more information, please visit www.nielsen-online.com
About The Nielsen Company
The Nielsen Company is a global information and media company with leading market positions in marketing information (ACNielsen), media information (Nielsen Media Research), online intelligence (Nielsen Online, which is comprised of NetRatings and BuzzMetrics), mobile measurement, trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with headquarters in Haarlem, the Netherlands, and New York, USA. For more information, please visit, www.nielsen.com
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