November 27, 2015 marked a major moment in shopping culture, because over 103 million consumers shopped online during the Black Friday, opposed to 102 million who went out to stores, according to the NRF Thanksgiving Weekend Survey. This marked the first time the eCommerce customers outnumbered the physical shoppers during the biggest shopping day of the year. The holiday tradition of going out to the stores with friends and family is now matched equally to the new tradition of shopping online.
However, while online shopping has never been easier or more popular, it seems that most consumers still prefer to shop in brick-and-mortar stores. According to a recent PwC survey, only 27% of consumers make a purchase online at least once a week, compared to more than 40% who buy in-store every week. The survey also revealed that around 60% of those consumers prefer the physical store because they want to have the item immediately. The fact is, people want instant gratification, because they are fond of seeing, feeling, touching and purchasing the item at the same moment.
Gratification and Expectation: Online vs. Physical
Buying online has given people the control over what and from whom they buy – but the actual product in question is maybe the most important factor. While certain niche online manufacturers and retailers are able to thrive in today’s marketplace, consumer psychologist Philip Graves explains that consumers are likely to buy familiar, branded with qualities they can predict online. Basically, if the item is not familiar to the consumer, chances are they will buy it in person. The most common reason is the likelihood that an unknown will need to be returned if purchased without seeing it or feeling it in person, outweighs the convenience of online shopping.
Small business owners strategically use stimulating in-store retail displays and other visual marketing tactics in order to promote the products and take advantage of instant gratification. A recognizable, branded product that the customer has probably bought before, and can find anywhere, may be more cost-efficient to sell online only. Conversely, those proprietary and new-to-market products that consumers need to see in person to buy may justify storefront real estate and inventory costs, if sold only in-store.
What Consumers Want: Convenience vs. Experience
When people buy in person, they are willing to give something up – whether it is the time, the money or something completely different - just because they believe that there is some unique payoff. It may be the luxury of leaving a store with exactly what they need in your hands, or it may be the access to personal assistance in the buying process. Whatever the case may be, customers are willing to take the risk that a store does not have the item they are looking for in stock, and because of some perceived value that shopping in person tends to offer.
On the other hand, while buying online requires minimal effort, the customer’s expectation is not necessarily different. A customer comes to a physical store, expecting the attention and trained staff, while a person that visits an eCommerce website may be driven by a similar desire to find whatever they are looking for as quickly as possible. Online customers expect choice, information about the inventory levels and the ability to compare prices, read user reviews and promotional offers. In addition, recent Walker Sands findings reveal that 8 out of 10 consumers will opt for online shopping, if the seller offers free shipping.
The Importance of Connecting: Instant vs. Human
For some people, shopping is more than just consumerism – it provides an opportunity to spend an afternoon with friends, and to alter the way you are perceived temporarily by changing your physical appearance. Despite the growing popularity of buying online, these emotional aspects of the shopping process maintain the appeal of buying in person. In fact, according to a 2013 study from the retail strategy firm - WD Partners, 75% of consumers cite the experience of human connection as the number one reason they buy in-store.
All in all, shopping online is different from shopping in person - but we cannot say that one is necessarily better than the other. Simply by recognizing the deeper reasons people buy in each channel, small business owners can be more strategic in what, where, to whom and for what price they sell their unique products.