The Online Consumer: How Buyer Behavior is Influenced Online
With the increasing power of technology in today’s consumer environment buyer behavior has changed significantly. Websites provide round-the-clock availability where customers can come to learn more about your business or make a secure purchase. In addition, they can find out more about your service quality through social media platforms like Facebook (likes and positive feedback), Yelp.com (customer reviews and ratings), or LinkedIn (recommendations from colleagues) which can directly influence their purchase decision. For example, two recent studies at The University of Maryland and Georgia Tech cited significant increases in the influence leading to a consumer purchase based upon a product rating system.
Traditionally, consumer purchasing models have revolved around a basic series of stages:
1. Problem recognition
2. Information search
3. Evaluation of alternatives
4. Purchase decision
6. Post-purchase behavior (satisfaction or remorse)
While these traditional stages of consumer behavior still apply, the availability of online information coupled with the ease and security of purchasing have condensed and facilitated the consumer purchasing process. What might have taken a few days for a consumer to make an educated purchase now can take a matter of hours.
According to the AIUAPR model listed below, there are a number of factors to consider when marketing to consumers from a psychological standpoint:
Once again, a changing online consumer environment means that in order to effectively market to potential / existing customers, companies must be aware of how to reach consumers, how to educate them and how to make it safe and easy to purchase their product. The online environment also allows for an expedited feedback loop so that not only can companies teach consumers but consumers can teach companies.
The Internet’s effect on consumer behavior
According to Forrester Research, this year the web will influence 46% of all retail sales in the United States and help drive a total of $1 trillion dollars in sales. In addition, that trend is predicted to rise at a rate of about 2 percent per year moving over 50% in the next few years. The following table illustrates how many people are online and making purchases:
(Age Group: Percentage Online, Percentage Purchasing Online)
12-17 years old: 93%, 38%
18-32 years old: 87%, 71%
33-44 years old: 82%, 80%
45-54 years old: 79%, 68%
55-63 years old: 70%, 72%
64-72 years old: 56%, 56%
(source Pew Research)
From this data we can see that a lot of people are online and more generations are making purchases online. So what can companies do? The best thing is to understand your potential and existing customers and what they’re doing online. Then use that research and basic consumer behavior psychology to cater to their needs. Below are some more trends that help to illustrate certain trends and attributes of today’s online consumer.
- 63% of consumers indicate they are more likely to purchase from a site if it has product ratings and reviews. (Major consumer electronics retailer/iPerceptions study, January 2008)
- The average consumer mentions specific brands over 90 times per week in conversations with friends, family, and co-workers. (John Moore, WOMMA, 2010)
- In a study conducted by social networking site myYearbook, 81 percent of respondents said they'd received advice from friends and followers relating to a product purchase through a social site; 74 percent of those who received such advice found it to be influential in their decision. (Click Z, January 2010)
- 75% of US online adults are active online social participators. (Forrester, 2008)
- 64% of consumers have made a first purchase from a brand because of a digital experience such as a web site, microsite, mobile coupon, or email. No other medium has so impacted—or altered—the traditional marketing funnel this way. (Razorfish Digital Brand Experience Study, 2009)
How PPC campaigns and a focused online marketing strategy can help pull it all together
The fact is there are a lot of people online today and with that, there is a lot of clutter. Understanding the online consumer as well as the online environment is critical to helping your firm’s message find the right people. Developing a focused and targeted pay-per-click campaign can help. Using the right online search marketing strategies and techniques, your company can be found and furthermore, conversions of traffic to sales will increase. In addition, with the proper online (analytics, form-fill, etc.) and phone tracking methods (call-tracking) you are better able to understand what is working and what is not, adjust your campaigns based upon those trends and continually achieve a positive ROI (return-on-investment).
Let us come to you! NetSearch Direct can help your business navigate the online environment to better understand today’s online consumer. We can help you to develop a focused online marketing strategy that includes campaign development, analysis, adjustment and reporting. If you’re interested in learning more we’d love to come and talk to you! To setup an informational session, please contact Kate Snowa at 1-800-418-8505 or email@example.com.