AP NEWS

IRI Finds Consumer Confidence Making Big Impact on E-Commerce Growth

February 5, 2019

CHICAGO--(BUSINESS WIRE)--Feb 5, 2019--While 2019 got off to a rocky start, with a partial government shutdown and trade challenges attributed to tariffs, consumers at the close of 2018 were buoyed by their strong household financial health and were spending accordingly. The latest IRI Consumer Connect survey results find that nearly 55 percent of consumers report their households were in good financial shape in Q4 2018, up 4 percent from Q3 2018 and 2 percent from Q4 2017. Hand-in-hand with consumer confidence is the growing and evolving e-commerce channel. In fact, 2018’s e-commerce sales increased by a whopping 35.4 percent, according to IRI’s new research, .

Consumers are increasingly comfortable with online purchasing, and retailers of all stripes are upping their online offerings, working to enhance the shopper experience with simple navigation, assortment, good values and delivery options.

“Millennial and Gen X consumers are more at ease with online purchases than older generations, and as e-commerce becomes more of a routine, those shoppers are migrating offline efforts to save money to their online practices,” said Joan Driggs, vice president of Content and Thought Leadership for IRI. “Online offers a lot of additional outlets for smart shopping, including easy comparison shopping and keyword search for more informed purchases.”

E-commerce sales are shining star of CPG omnichannel universe

E-commerce sales for the latest 52 weeks ending Dec. 30, 2018, were $58.9 billion, a 35.4 percent increase from a year ago. These sales account for only 11 percent of total CPG retail sales; however, e-commerce accounts for 64 percent of total omnichannel growth.

“Pure-play retailers garner more than half of all online CPG purchases, but traditional brick-and-mortar retailers continue to invest and win share of the e-commerce pie,” said Sam Gagliardi, head of e-commerce for IRI. “It is incumbent upon the future success of these traditional retailers to invest in the shopper experience both in-store and online.”

Non-food items, particularly personal care and home care products, are tops in online purchases. IRI E-Market Insights reports that vitamins, pet food and supplies, and skin care products are the top- selling items. Pet food and supplies are often bulky items that are inconvenient to purchase off store shelves. Vitamins, typically purchased for specific health benefits, are likely considered easier to shop for online through keyword search and with access to additional information.

Specifically, Q4 Consumer Connect survey respondents say buying online allows them to find lower-priced beauty and personal care product options — 29 percent of total U.S. consumers, 45 percent of millennials, 35 percent of Gen Xers, 27 percent of boomers and 14 percent of seniors. These results closely mirror thought on home care products, with 30 percent of total consumers, 43 percent of millennials, 36 percent of Gen Xers, 27 percent of boomers and 19 percent of seniors saying they find lower-priced options online.

While fresh and frozen items rank among the bottom of e-commerce sales categories, there are signs of significant growth, indicating that retailers — likely with the support of such flexible options as click-and-collect — are starting to crack the code on delivering fresh and frozen items via online.

Millennials and Gen Xers, the two generations most likely to find value in shopping online, are also the generations that report having the most difficulty affording needed groceries (34 percent of millennials, 36 percent of Gen Xers). More than half — 54 percent — of millennials and Gen Xers report they are less likely to make impulse purchases when buying online. With this in mind, e-commerce should be touted as a tool for helping shoppers stick to their budget. Overall, 50 percent of total respondents report they are less likely to make impulse purchases online, including 49 percent of boomers and 44 percent of seniors.

It’s no surprise that 38 percent of all consumers like ordering online and picking up in the store, because it is convenient and is a good way to avoid shipping fees. In fact, 49 percent of millennials, 48 percent of Gen Xers, 38 percent of boomers and 24 percent of seniors feel the same.

In addition to purchases of bulky or heavy items, such as pet food, shoppers are increasingly going online for more sensitive purchases. IRI E-Market Insights reports that gastrointestinal and adult incontinence products are among the largest e-commerce growth categories. These products are not what people imagine themselves needing, so when these occasions arise, it’s both a comfort and a convenience for shoppers to learn about and order products online.

“E-commerce sales will continue to climb in 2019 and beyond, with retailers increasingly investing in better ways to engage shoppers, including with improved navigation and mobile access, delivery and payment options, and endless aisle assortments,” added Gagliardi.

Helpful Links:

IRI Consumer Connect Analysis since 2016: https://www.iriworldwide.com/en-US/Insights/Publications/Consumer-Connect

E-Market Insights 3.0 Press Release: https://www.iriworldwide.com/en-US/News/Press-Releases/IRI-Announces-Enhancements-to-Industry-Leading-E-Commerce-Measurement-and-Insights-Solution

About the IRI Consumer Connect Survey

IRI provides new survey results at the end of each calendar quarter covering shoppers’ behaviors and attitudes as they directly relate to their strategies for learning about, purchasing and utilizing CPG and health care products, as well as information regarding perceptions of economic conditions and their ability to provide for their families. For more information about customizing the research for a particular category or industry, please email IRIMarketing@IRIworldwide.com.

About the IRI Partner Ecosystem

IRI fundamentally believes that delivering differentiated growth for clients requires deep, highly integrated partnering with a variety of best-of-breed companies. With this in mind, IRI works closely with a broad range of industry leaders across multiple industries and sectors to create innovative joint solutions, services and access to capabilities to help its clients more effectively collaborate and compete in their various markets and exceed their growth objectives. IRI is committed to its partnership philosophy and continues to actively enhance its open ecosystem of partners through alliances, joint ventures, acquisitions and affiliations. The IRI Partner Ecosystem includes such leading companies as 84.51°, Adobe, Boston Consulting Group, Clavis Insights, comScore, Data Plus Math, Edison, Experian, GfK, Gigwalk, Google, Ipsos, Jumpshot, Mastercard Advisors, MaxPoint, Omnicom, One Click Retail, Oracle, Pinterest, Research Now/SSI, Simulmedia, SPINS, Univision, Viant and others.

About IRI

IRI is a leading provider of big data, predictive analytics and forward-looking insights that help CPG, OTC health care organizations, retailers, financial services and media companies grow their businesses. A confluence of major external events — a change in consumer buying habits, big data coming into its own, advanced analytics and personalized consumer activation — is leading to a seismic shift in drivers of success in all industries. With the largest repository of purchase, media, social, causal and loyalty data, all integrated on an on-demand, cloud-based technology platform, IRI is empowering the personalization revolution, helping to guide its more than 5,000 clients around the world in their quests to remain relentlessly relevant, capture market share, connect with consumers, collaborate with key constituents and deliver market-leading growth. For more information, visit www.iriworldwide.com.

View source version on businesswire.com:https://www.businesswire.com/news/home/20190205005150/en/

CONTACT: IRI Contact:

Shelley Hughes

Email:Shelley.Hughes@IRIworldwide.com

Phone: + 1 312.474.3675

KEYWORD: UNITED STATES NORTH AMERICA ILLINOIS

INDUSTRY KEYWORD: OTHER CONSUMER TECHNOLOGY ONLINE RETAIL DATA MANAGEMENT PROFESSIONAL SERVICES CONSULTING RETAIL CONSUMER

SOURCE: IRI

Copyright Business Wire 2019.

PUB: 02/05/2019 09:05 AM/DISC: 02/05/2019 09:05 AM

http://www.businesswire.com/news/home/20190205005150/en

AP RADIO
Update hourly