E-commerce is "social commerce" as online shoppers, particularly younger generations, are heavily influenced by social media and Web 2.0 technologies. Online retailing is being profoundly impacted by the integration of social media into what historically has been a transactional experience," said Joshua Reynolds, worldwide technology practice director, Hill & Knowlton and co-author of the report.
According to the "Future of Commerce" report from Hill & Knowlton, key factors influencing behavior include:
-- Experience counts: 83 percent of respondents said "personal prior experience" has the greatest impact on where they choose to shop online. Trailing behind experience were the following sources: family member (48 percent); friend (44 percent), and an online offer or ad from the online store itself (43 percent).
-- Social media is "Word of Mouth 2.0" for younger generations: Younger generations are predominantly influenced by social media channels: 27 percent of Gen Y are influenced by an "online community or blog" compared to 19 percent of Gen X and only 9 percent of Baby Boomers.
-- Traditional media remains universal driver of influence: Traditional, offline media remains the most effective vehicle for reaching mass audiences: 19 percent of all survey respondents were influenced by an "article in a newspaper or magazine" and 12 percent by "radio or broadcast TV program."
-- The link between thought leadership and corporate valuation: An analysis of more than 300 traditional news articles covering the industry's top e-commerce leaders over a year-long duration indicates strong linkage between companies who talk about the industry - and not just themselves - and increased brand valuation. For example, e-commerce companies that discussed macro environmental topics, such as the evolution of e-commerce, scored highest in "brand presence," perhaps an indicator of the positive impact of establishing a position and maintaining a strong voice in a changing market.
The most effective way to reach consumers online is with highly-targeted campaigns tailored to engage micro communities that form around common interests," said Julie Mathis, vice president, consumer technology, Hill & Knowlton. "One-size-fits-all marketing is not a viable communications approach in today's PR 2.0 world." The economy is having a heavy impact on consumer online shopping habits according to the report:
-- Shopping is down: When asked how consumers have changed their everyday item purchases since the economy has receded, 46 percent of consumers said they shop less overall, whether online or offline. The older the consumer, the less likely they are to shop overall.
-- Value is key in a down economy: Fifty percent of respondents said they are shopping online more to look for better bargains. And, Gen X and Y are more likely than Baby Boomers to shop online for better bargains in a down economy.
Our research indicates that online shopping increases in a downturn, providing a potential offset for offline retailers experiencing revenue losses in the downturn," added Reynolds.
Getting to know the online consumer is vital for future success. Social media is by far the best way to understand your future customers and to be able to provide the products and services they want and need.
Data through May 2009, released July 28, 2009 by Standard & Poor's for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, show that, although still negative, the annual rate of decline of the 10-City and 20-City Composites improved for the fourth consecutive month in 2009.
The 10-City and 20-City Composites declined 16.8% and 17.1%, respectively, in May compared to the same month last year. These values are improvements over April's data, which show annual declines of 18.0% and 18.1%, respectively. After 16 consecutive months of record annual declines, beginning in October 2007 and ending in January 2009, the indices have now shown four consecutive months of improvement in annual returns.
“The pace of descent in home price values appears to be slowing," says David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. "There is a clear inflection point in the year-over-year data, due to four consecutive months of improved rates of return, after the steep decline that began in the fall of 2005. In addition to the 10-City and 20-City Composites, 17 of the 20 metro areas also saw improvement in their annual returns compared to those of April. Looking at the monthly data, 13 of the 20 metro areas reported positive returns; and the 10-City and 20-City Composites reported positive returns for the first time since the summer of 2006. To put it in perspective, these are the first time we have seen broad increases in home prices in 34 months. This could be an indication that home price declines are finally stabilizing."