CAPE TOWN – Online shopping through sites like Kalahari, BidorBuy, Takealot or Zando may be booming this Christmas, but research by Google Insights on South African shopping habits reveals that nine out of ten consumers still prefer to purchase big ticket items in person.
This does not discount the role of the internet. The same research notes that roughly 50% of big ticket purchases are influenced by research that is done online. Google dubs this “research online, purchase offline (ROPO)” and says it is a growing trend. It is one that will probably please bricks and mortar retailers who have lagged in their development of online shopping facilities.
According to Google, of the consumers who buy electronic products, 75% will have done some online research ahead of the purchase, but just 12% will order that product online. Similarly, 53% of shoppers looking for items for their houses and gardens will do preliminary online research, and 8% of them will order online. The entertainment sector is the clear outlier. Of the 65% of consumers who search entertainment offerings online, over a third will buy tickets online.
One company to take advantage of this trend is the price comparison website Guzzle founded by entrepreneurs Ric Meulemans and Oliver Bryant. Comparison websites are not a new thing. Pricecheck.co.za is probably the best known, but shopmania.co.za and uprice.co.za offer similar services. Guzzle is different in that it is not comparing the prices of goods found online, but of goods that bricks and mortar retailers like Game, Makro, PnP and Shoprite are promoting.
Consider the reams and reams of advertising broadsheets that are currently inserted into all the mainstream newspapers and lie around homes and offices. Can you remember which retailer was offering what and at which price?
Guzzle lists all the price promotions from all the major retailers in a way that makes searching – by specific product, generic category, by retailer or by retail broadsheet – simple. The promotions are updated weekly and prices are easy to compare.
At this point in time Guzzle is not charging the retailers for the service. But the site has been running for 14 months and now attracts about 10 000 unique visitors a day. Each visitor spends roughly six minutes on the site. This kind of critical mass has to be worth something. “We know exactly how many customers clicked on a catalogue and which individual products were viewed,” says Meulemans. The company has developed a ‘dynamic advertising’ offer which it expects to be a big hit with retailers.
In the past month the top searched retailers on the site were Game, Clicks, Pick n Pay, OK and Makro. The top searched products were the iPhone 5; iPad 3/ iPad; iPad Mini, Wii U and Samsung Galaxy S3. The top broad shopping related search terms are catalogues, specials, fridges, appliances and washing machines. The top food searches are chicken, leg of lamb, gammon, potatoes and tomatoes and unsurprisingly, the top drink searches were wine and beer.
“This reflects the shopping behaviour of about 200 000 users and is very reflective of what is important to consumers right now,” he says.
While consumers are using the internet to research prices on big ticket items, they are also comparing the prices of smaller items – like groceries. More and more consumers are accessing the site using their smartphones . “They don’t spend as long browsing, but they are definitely looking for the best offer.”