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Wednesday, October 20, 2004

Online Info Spurs Offline Spending

Online product research by consumers this past year was responsible for driving $180.7 billion in offline spending, compared to $106.5 billion in direct online consumer spending according to The American Interactive Consumer Survey conducted by The Dieringer Research Group.

Thomas E. Miller, senior consultant at The Dieringer Research Group, said "The new annual spending data indicate that at least $1.70 is spent offline after doing online research for every consumer dollar spent directly online. In reality, the offline spending impact is far greater because many consumers also go online to research financial and insurance products that are not reflected in the retail spending total."

According to the new research, nearly 15% of total U.S. retail spending (excluding gasoline, food services and inventories) is currently influenced altogether by the Internet, a much higher ratio than is commonly cited.

The study also found that Internet-influenced offline spending is now growing faster than direct online spending. Internet-influenced offline sales grew 31% last year and direct online sales grew 14%, while total U.S. retail spending grew only 5% during the comparable period.

"The data confirm that the Internet's role as a consumer product information utility is much larger than its role as a direct selling medium," Miller explained.

Internet Influenced Spending
US Consumers 2002-2004 (billion dollars)

Source: Dieringer Research Group, October 2004

The survey also found that 17% of all U.S. consumers who opened new financial service accounts or took out new insurance policies the past year used the Internet in their product decision-making process. "Those decisions by online consumers affected literally billions of dollars in financial services revenues, making the total dollar impact of online information far greater than anyone is talking about," concluded Miller.

You can find out more here.

Research Brief for Wednesday, October 20, 2004:
http://www.centerformediaresearch.com/cfmr_brief.cfm?fnl=041020

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