Online purchase behavior | KPMG | RU

Online purchase behavior

Online purchase behavior

The digital age and rise of ecommerce is driving unprecedented business model shifts for manufacturers and retailers.

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Partner, Head of Consumer Markets

KPMG in Russia

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Many traditional consumer businesses and new start-ups alike are moving away from models that are shop-centric or geographically-focused, to ones that are customer-centric and virtually borderless.

To help inform companies tackling this transformation, KPMG International’s recent survey of 18,430 consumers provides a unique, comprehensive index of consumer online shopping behaviors and sentiments across countries, products and generations.

Key global insights

  • Ecommerce is a rising trend: Online purchase frequency varies considerably by geography. Consumers in Asia, North America and Western Europe are most likely to shop online, while per capita online purchases in Eastern Europe and Russia, Latin America, and the Middle East and Africa are less frequent.
  • Generation X consumers are the most active online shoppers: Among the different age groups, Generation X consumers (born between 1966 and 1981) made more online purchases last year than any other age group, averaging nearly 19 transactions per online shopper per year.
  • Don’t underestimate the Baby Boomers: Compared to the digital-first Millennial generation, it is reasonable to presume that Baby Boomers (born between 1965 and 1946) are less inclined to shop online. However, the Baby Boomers surveyed in fact shopped online just as frequently as the Millennials.
  • Men spend more online than women: While men and women shopped with about equal frequencies, on average, the men spent more per transaction – men spent US$220 vs. US$151 for women on their most recent purchase.

Product categories

The online shopping landscape is gradually changing in terms of the types of products that are being bought online. Generally, consumers’ planned online purchases indicated a year over year increase for most product categories. These results signal a higher willingness to buy new product categories online, particularly those more traditionally sold in shops.

Greater options for shipping and delivery have made it easier and more common to buy bulkier products online – including furniture, appliances and even vehicles. Meanwhile, although ‘easier to ship’ products such as books, music, electronics, accessories and apparel remain the most popular online categories, relative growth in these segments is expected to be minimal.

Borderless shopping

Cross-border shopping is on the rise globally, driving international retail trade.

In many countries, the tendency to buy internationally is highest among Millennials. This could indicate potential growth for cross-border online shopping as consumers increasingly seek unique or specialized products from other countries. In the US, for example, 15 percent of Millennials’ recent purchases were imported, compared to 9 percent for Generation X and just 3 percent for Baby Boomers. It will be interesting to see how the new US administration’s proposed focus on domestic protectionism might affect the trend for younger US consumers to shop outside the country.

The rising power of e-tailers is also apparent around the world and contributing to global ecommerce. Their dominance is particularly evident in China and India – where over 80 percent of online purchases were from e-tailers – as well as in Japan (69 percent), Italy (68 percent) and South Africa (65 percent). The share for e-tailers in these countries is far above the global average of 50 percent.

A trend of younger consumers being less likely than Baby Boomers to buy from e-tailers could indicate a future slowdown in this platform’s growth. Fifty-four percent of Baby Boomers, who are less prone to shop around for price and who prefer to buy from familiar websites, made their most recent purchase from an e-tailer, compared to Millennials with e-tailer purchases at 48 percent. Conversely, Millennials were 30 percent more likely than the Baby Boomers to buy directly from a retail shop’s website.

About Russian online consumers

7 Insights to strengthen e-commerce strategy in Russia

1. Chinese e-commerce comes to Russia

17% of Russians already buy on Asian online shops. A significant share of the e-commerce market is still controlled by European vendors

2. The value of trust

Russians need assurance that the online retailer they are using is not run-of-the-mill.

3. Price is still king

Price (24%) has the greatest influence on final purchase decisions for Russians, above all other factors, including brand (15%), and peer influence (9.6%).

4. Products: a closer look

Consumer electronics is a leading category for buying online (56%), followed by books/music (46%), and accessories (43%).

5. Russians still prefer cash

A significant share (47%) of Russians prefer cash on delivery (COD), compared to 15% globally.

6. Consumers simply want a better experience

Over half (59%) of Russians consider the option to buy 24/7, usability (53%), and real-time delivery information (49%) as highly important elements when choosing which brand or retailer to buy from

7. Mobile is set to step up to the plate

While mobile internet in Russia is becoming an important part of life, shopping by smartphone or tablet still occupies a relatively low share – around 4% of the total. Mobile shopping in coming years is expected to double its share (to 8%), in line with the global trend.

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