The online consumer evolution
by Jay Wilkinson
It's a consumer jungle out there with the Digital Natives running wild. Their purchasing habits are changing at a staggering pace and it's up to you to keep up
No matter how much our technologies advance, we always seem to come full circle. Consumer buying habits are no different. While the methods of gathering product information have certainly changed, the core principles behind how consumers decide what to buy today hearken back to those we saw hundreds of years ago. It is now up to us, the product providers, to take notice and accommodate as necessary.
In order to understand the purchasing habits of years past, we have to look at the landscape as a whole. A few hundred years ago, the majority of the earth was rural. Travel was difficult and rare, communication avenues were sparse and therefore people purchased items in their most immediate town centres. And the only way they learned of these products was from others in the community.
Should you buy that tool at the hardware store or the blacksmith? Consumers relied entirely on the experience of their friends and neighbours to answer that conundrum.
Fast forward a hundred years to the time of the first urban and suburban communities. With the advent of television and radio, people started listening to the 'experts'. They truly took heed of what advertisers and marketers had to say because they had no reason not to.
People were not yet jaded by false advertisements or bombarded by several thousand different messages in one day. In addition to this, new products were hitting the market in droves. Consumers listened to what advertisers had to say because their trusted word-of-mouth sources may have not yet used or experienced a product or service.
Present-day buying habits take us both forward and back. It's obvious our ability to learn about a product has vastly increased since the days of small villages. The advent of the internet has led to instant information and gratification.
However, who do we listen to in the online world? When was the last time you trusted what a commercial had to say? Consumer-driven websites are the modern-day village community, and consumers trust what these other buyers have to say far more than they trust a single word from your company.
How much does consumer-driven feedback affect buying decisions? According to Opinion Research Corp, 83 percent of shoppers said online product evaluations and reviews influenced their purchasing decisions. And Marketing Sherpa tells us 87 percent of respondents said they would trust a friend's recommendation over a review written by a critic. This is a huge shift in collective consumer consciousness from even a mere decade ago.
A lot more has shifted when it comes to consumer buying habits as well. And while the word-of-mouth decision process reflects on our past, the remainder of purchasing habits is positioned squarely in the future.
We have to remain hyper-aware of all of these purchasing trends in order to compete in today's market.
The models
Purchasing models of the past were focused on three fairly lengthy steps. Consumers first had to develop a need - then they had to understand and be aware of a company to fulfil that need. Finally, if the company had what they wanted and the price was right, they may or may not have decided to buy. However, with the advent of more advanced online shopping methods, companies are finding ways to shortcut this process.
Online companies like Amazon.com now offer one-click shopping. No need to fill out lengthy forms or credit card numbers, just find what you want, click "buy" and you're set. Also, products are suggested to the user based on previous purchases - no awareness or need required.
The methods
With the ever-increasing evolution of mobile devices, even the online shopping cart may soon be a thing of the past. The ability to purchase from a cell phone, BlackBerry or other mobile device will likely become more and more common.
Not only will mobile devices allow the consumer instant access to searching for and finding products efficiently, it will allow them to better explore and evaluate the products. Some mobile devices even allow the user to scan the bar code of a product to receive immediate information.
Even products that the public said would never sell online are making waves on the internet. In 2008, Skype surpassed AT&T as the largest provider of international calls. Prior to technology such as Skype (termed VOIP), the internet was said to have gotten us 80 percent of the way to total international connectivity. VOIP will take us the remaining 20 percent as the technology evolves even further.
The purchasers
While the true power and functionality of these mobile devices might be a bit foreign to you and me, the purchasers entering the work force (and thus purchasing office products) will not only understand the functionality, they will expect it.
The Millennial generation, also known as Digital Natives, are used to accessing information the moment they have the need. They are easily frustrated if they are unable to get what they want, the minute they want it.
According to Nicholas Negroponte: "A child born today will have access to tools and technology when graduating from college that are 1,000 times more powerful than those that we use today."
This will obviously dramatically change the way we advertise, display and provide purchasing options. The more the influences around us change, the more our buying habits will change.
The Influences
The final piece to this purchasing puzzle is influences. There are three categories that affect how we make purchases:
• Internal - Your personality, knowledge and lifestyle. The core of your belief system
• Marketing - The method in which a product is promoted, priced and distributed
• External - Groups, friends, family, cultures and life situations
As was discussed in the opening of this article, the village mentality was one where external influences affected our internal belief system and contributed greatly to what and how we buy. This slowly evolved into a landscape where marketing had a much larger contribution to our decision-making process.
Now, with the advent of the internet, external influences are back in favour. The only difference is that now they come from a much broader and more diverse online community where someone is bound to have an opinion on any product or service.
Consumer-driven websites, feedback, instant critiques and recommendations on social networks such as Facebook and Twitter have changed the way we make purchasing decisions. Online search sites such as Google may be the engine behind the online influencers, but social media is the vehicle. According to Netmarketer, 66 percent of these social networkers are more likely to buy a product as a result of a recommendation.
