Mother’s Day Online Spending Hits $4.4 Billion in 2005
VeriSign, the e-commerce infrastructure provider, announced that Mother’s Day-related spending hit US$4.4 billion this year, during the period from April 25 through May 8. That represented a 24% increase over Mother’s Day 2004. I didn’t see a detailed category breakdown (i.e., flowers vs. apparel, etc.), although apparently jewelry purchases increased by 79 percent.
So does this simply mark the inexorable march of e-commerce—or something more complex? As you might have guessed, I’m prone to think the latter.
I didn’t see any more data on the buying patterns than what I reported above. However, I’m going to speculate about the drivers of this impressive spending. First, I think convenience figures prominently here. Many people live in places other than where their mothers live (I do). With a few clicks, buying online takes care of the hassle of shipping something out of state or across the globe (if that applies).
I sent my mother flowers from a local florist in her area. There was no e-commerce on the florist’s site—I sent an email telling them how much I wanted to spend and to call me in the morning to get my credit card number, which they promptly did at 7:30 a.m.! (Question: is that an “online transaction”? Answer: maybe.)
Also under the heading of convenience (or efficiency), online shopping can—and does— take place during work hours, as two recent studies have reported. According to a December 2004 BURST! Media consumer survey, roughly 35% of workers with Internet access have done price comparison shopping at work, while slightly more than 31% have purchased products at work. Similarly, a Websense May 2005 survey indicated that 52% of respondents shop online at work.
Then there’s the “life events” Web behavior pattern. I wrote about that recently in our Local Media Journal. Briefly, comScore recently documented what directory publishers have known for a long time— life-cycle events drive usage and spending. Events such as getting married, buying a home, having a child, and so on, were mapped to increased online activity and buying.
But wait, you say Mother’s Day isn’t a “life event.” That’s technically true, but consider it a mini life event. Accordingly, holidays might be considered second order life events that drive e-commerce for some of the same reasons as major life events, including efficiency.
So, at a broad level, I’m arguing there are probably a set of variables that, if present, suggest whether consumers are likely to buy online vs. offline. In the Mother’s Day context, the combination of convenience (shipping), the ability to shop and buy at work (efficiency) and the holiday trigger (time pressure) suggest the outcome VeriSign reported—higher online spending. (Also, the heavy offline spending precedent with Mother’s Day is another indicator.) I would also add that the average price of Mother’s Day gifts is not likely to require high consideration, which would otherwise favor offline buying.
Where some combination of these factors are present—the need for efficiency, time pressure, convenience, relatively low consideration—it’s more likely that consumers will buy online. However, if there’s no similar time pressure or the items under consideration are more expensive (US$500 is something of a threshold), I might well shop online (at work) but complete the transaction offline (after work).
I’m not suggesting a rigid formula, rather a predictive set of variables.
To some these might be obvious or banal observations. If so, it’s probably because my thinking has been dulled by infomania.