It used to be so easy. Retailers knew they could sell articles like apparel and footwear in bricks and mortar stores. Books and music have been a force in online retailers for a while but that's not all consumers are buying online. Because everything is changing, marketers need to make sure their ad budgets are targeting channels properly.
One of the biggest stories in online retailing this year has been the rise of online sales in beauty and personal care products. According to A.T. Kearney, between 33% and 45% of consumer budgets for this category is now spent via the Internet. The research shop estimates that this represents about $3 billion annually.
The online marketplace is heating up in a few other categories as well. Here’s how many consumers have purchased products and services online by category:
- Books: 81%
- Apparel: 74%
- Music/TV shows/movies: 65%
- Beauty/personal care products: 59%
- Footwear: 54%
- Consumer electronics: 52%
- Spa/Salon service: 34%
- Jewelry: 24%
- Furniture: 18%
- Household cleaning products: 16%
One might think that peer reviews would play a big role in online sales of the beauty product category but researchers discovered that other attributes were more important. Finding specific products (96%), free shipping (93%), and finding favorite brands (92%) were at the top of the list for most shoppers.
From a marketing perspective, one of the concerns is where shoppers are buying these products. Amazon (28%) is at the top of the list, followed by Sephora.com (18%) and drugstores and mass merchants (11%). Marketers need to consider what this means for the future. Until now, they have invested in trade promotions with their retail partners and in exchange are assured of good shelf placement. As more shoppers seek products online, marketers must determine the best way to manage promotions, one that protects and enhances brands.[Source: A.T. Kearney Ecommerce Study. Atkearney.com. 5 Jun. 2012. Web. 23 Jun. 2012; Multichannel is a Must. Emarketer.com. 25 Jun. 2012. Web. 29 Jun. 2012]