Just a few weeks back, I wrote about the role of trust in e-commerce. In that article, I presented data provided to me by ScanAlert. The data shows that people are doing more and more comparison shopping today then they did just a couple of years ago, and they are taking longer and longer to make their buying decisions.
This attracted the attention of HealthPricer.com, which provided me some data on how its site performs with respect to conversion delay. What is notable about this data is how much lower the time to transaction is over the sample of 2,288 orders. This sample was for pharmacy buyers who bought something through the HealthPricer.com site between June 1, 2007 and July 10, 2007.
Below is the raw data provided to me by HealthPricer.com:
|Time||Transactions||% Transactions||Average purchase value||Average time conversions||Total minutes|
|1-10 minutes||1,297||56.70%||$94||6 minutes||7,782|
|11-30 minutes||604||26.45%||$123||15.6 minutes||9,422|
|31-60 minutes||95||4.15%||$151||41 minutes||3,895|
|1-24 hours||140||6.12%||$126||8.5 hours||71,400|
|1-3 days||22||0.90%||$160||45 hours||59,400|
|more than 3 days||130||5.68%||$173||354 hours||2,761,200|
For purposes of comparison, below are the ScanAlert numbers, normalized to also show transaction times in the same format at the HealthPricer.com data shown above.
|1 to 60 minutes||43%|
|1 to 3 hours||13%|
|3 to 12 hours||7%|
|12 to 24 hours||7%|
|1 to 3 days||4%|
|3 to 7 days||8%|
|7 to 21 days||12%|
|More than 3 weeks||6%|
Comparing the Two Studies
Note how much longer the transaction times are in the ScanAlert study. On HealthPricer.com, 87.3 percent of the transactions where completed in less than 60 minutes from the initial visit to the site, and these transactions took place in an average time of 10.5 minutes. The ScanAlert data shows that 82 percent of the transactions took up to 7 days to complete.
This does not mean the ScanAlert study is inaccurate. It measured the average transaction times across a wide range of different e-commerce sites. Some of these sites involved products or services that required more thought before purchase; whereas the HealthPricer.com site is focused on products where people were more likely in buy-it-now mode (products included prescriptions, contact lenses, supplements, and nutrition and hygiene products).
The ScanAlert study shows that trust plays a key role in consumer shopping decisions. The HealthPricer.com shows the impact of addressing the comparison-shopping needs of the consumer in a single place. For example, a May 2007 survey by Accenture shows that 68 percent of the participants compare prices online. This backs up the conclusions of both studies. Ultimately, since consumers want to comparison shop, presenting them with all their options on a single site is a very powerful thing to do.
E-Commerce Market Growth
The e-commerce market continues to expand rapidly. Below are some of the latest industry statistics on that growth.
- eMarketer reports that 85 percent of online shoppers will also be online buyers this year.
- A JupiterResearch report indicates that U.S. online retail sales will grow by 16 percent in 2007 to reach a total of $116 billion. The same report indicates that over the next five years, U.S. online retail sales will reach $171 billion.
- ThirdAge Inc. and JWT Boom collaborated on a survey that indicates adults aged 45 years or more like to shop online. The study shows that 73 percent of respondents put shopping as their top online activity.
The Importance of Meeting Customer Needs
Given this environment, and the increasing awareness that consumers have multiple options online, it is more critical than ever to meet the needs of your customers efficiently and effectively.
Comparison-shopping sites help meet the needs of shoppers who want to see all the price comparisons on a single screen, resulting in a shorter time to conversion. The contrasting results of the two studies help show just how powerful an impact this can be on a shopper's experience and decision making.