Consumer Electronics: The Leap Year in Online Shopping. United States: Q4 2016 - Criteo
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Consumer
Electronics:
The Leap Year in
Online Shopping.
United States: Q4 2016
Preface Nearly 200,000 tech enthusiasts flooded the Las Vegas convention halls at this year’s Consumer Electronics Show to gape at driverless cars, phones, high def TVs, refrigerators with internet connectivity, drones and virtual reality goggles. There is something new in 2016: truly innovative products are more affordable and more widely distributed by a variety of manufacturers. This indeed will be the “Leap” year in which products that were considered sci-fi two years ago will become mainstream. Ecommerce will be the way that an increasing percent of goods like these will sold. CONSUMER ELECTRONICS WHITEPAPER 2016
Key Findings
17 Products: The number of product detail pages Video Gaming buyers look at before purchase
27% of Shoppers: Add more CE items to their cart they hadn’t planned on buying
72% of Shoppers: Say ratings and reviews motivate them to click the buy button
4x Increase: The highest increase over the norm for conversion: Black Friday Week
CONSUMER ELECTRONICS WHITEPAPER 2016
1 Category Trends. CONSUMER ELECTRONICS WHITEPAPER 2016
CE: The Most Digital of All Categories
Online shopping and Consumer Electronics are so intertwined that it’s impossible to separate the two. So many products
facilitate online commerce and in turn, online commerce is fueling the growth of the category. The US Census Bureau
announced that second quarter 2016 ecommerce increased 15.8% YOY, while overall growth was just 2%.**
Millennials will invest in VR. The AR phenomenon With the broadening of content shot in 4K and the
of Pokémon Go primed the potential audience for price dropping well below $1000, it makes sense for
these. They bring the gaming experience into new people to invest in that 54” ultra high-def TV before
dimensions of interactiviy. the Super Bowl.
Grandma will upgrade to an iPhone 7 with Bluetooth Desktops are history and notebooks old news, but
ear buds as her iPhone 5s needs an upgrade. combo tablets like the Microsoft Surface will likely be
even bigger hits this holiday than they were last.
Teens and Millennials will get their first drone for the
holidays with some models costing below $100 and Smart watches and fitness trackers are now so affordable
even dedicated retailers. and ubiquitous they may become stocking stuffers.
CONSUMER ELECTRONICS WHITEPAPER 2016It’s only a matter of time before product ordering via voice becomes
common and further pushes the shift to online product sales.
All of this adds up to double digit growth in the CE category.
When you also consider emerging How to ensure your product makes 2016 Q2 Year-Over-Year Retail Growth1
CE trends like voice activation it into more carts this holiday and
and AI plus iOT, it adds up to into 2017? Understanding the
extraordinary potential consumer behaviors of shoppers online can
spending. Already, 5% of Amazon help brands and retailers increase Ecommerce
Prime subscribers own Echos and sales in this pivotal “leap year” for 15.8%
are talking to Alexa while Google Consumer Electronics. The Criteo
attempts to get into the game with Exchange is the largest ecommerce
Google Home this season. It’s only media exchange globally and has
a matter of time before product a rich shopper data set that reveals In-Store Retail
ordering via voice becomes details like purchase cycles and 2%
common and further pushes the
product consideration. In this
shift to online product sales. US and UK from mid-July through Shopper Survey, which asked
whitepaper, Criteo analyzed the
mid-August. This behavioral data is purchasers of electronics about
Just wait till Q4. eMarketer believes behaviors of 600,000 ecommerce
complemented with insights from their buying habits.
that overall sales will increase 17% shoppers representing $218
the third annual Criteo Online
this season over last.*** million in sales across both the
CONSUMER ELECTRONICS WHITEPAPER 2016 Source:
** census.gov/retail/mrts/www/data/pdf/ec_current.pdf US Census Bureau
*** emarketer.com/Article/Holiday-Retail-Ecommerce-Sales-Will-Grow-17-this-Year/10145292 Shopping Behaviors. CONSUMER ELECTRONICS WHITEPAPER 2016
Consumer Electronics 20
Average Product Detail Pageviews 1
may have the most
Video Gaming & Mobile Phones require the most research
before purchase, hence the higher pageview count
15
distinct shopping 10
behavior in ecommerce. 5
With high relative price points and many product details, 0
Ov Vi Ca V De
CE is the most-researched product category. Twenty-seven era de Mob Aud Tabl Lapt Telev Hea Acce me ideo Print skt
ll o G ile io ets op isio dp ss ras ,C op
am Ph s h o o
percent of shoppers say that they spend from two weeks to ing one ns one ries py, S Com
s s ca pu
n ter
six months thinking about the purchase (compared to 18% for s
the average product) before they even go online.* When you
compare the category as a whole to other types of products,
Electronics takes more days from first browse to purchase
and in that time more products are looked at than in any
other category. Index of Average Purchase Cycle 2
154
Overall, an average of 14 product detail pages are viewed in
the shopping process for an Electronics product. By sub- 131 114 100 83
Video
76
Accessories
category, more product detail pages are looked at in Video Tablets Audio Cameras
Video Gaming
Gaming and Mobile Phones than other categories. This likely
reflects both the competition in the category and the amount
of detail consumers are likely to want. Tablets and Audio
equipment are the next most-researched purchases. 137 115
131 115
115 131 115
113 131
86 77 44
Laptops Laptops Laptops
Headphones Desktops Print, Copy,
Mobile Phones Tablets
Laptops Tablets
TVs Tablets
Scan
Likely reflecting the longer-term investment some of these
products require, Video Gaming has the longest purchase
cycle (54% longer than the category average) while the
purchase cycles of Mobile Phones and Tablets
are 37% and 31% longer than average, respectively.
CONSUMER ELECTRONICS WHITEPAPER 2016 1, 2
Criteo Exchange Data: 7/18 – 8/18/2016What do consumers say influences conversion in Electronics? The Criteo Online Shopper Survey delved into consumer attitudes on the subject. The hurdle of actual touching the CE product before it is invested in has become less relevant to the Product description is key. 30% of Ratings and reviews have outsized Video is important. 18% rated it very majority of consumers: two years ago shoppers browsed another site due to impact. 72% rated this as very important important versus 14% on average. 52% said they did not make a specific the inadequate product description — for making the purchase as compared to Consumers want to see Consumer CE product purchase online because 10 points over the average. Sixty-six the average of 55% of online shoppers. Electronics in action. they couldn’t touch and feel it. Now percent of online shoppers say product that number has dropped to 44%. description is a top three factor that What motivates consumers to go from drove the actual purchase as compared browse to buy? to 57% on average. CONSUMER ELECTRONICS WHITEPAPER 2016
3 Top Terms by Sub-Category. CONSUMER ELECTRONICS WHITEPAPER 2016
What are They Searching For?
When you look at the list of the top 25 terms searched within CE, they reflect a mix of old and new technologies. With innovations like 4K getting
so affordable, consumers are in the middle of a big upgrade cycle and “TV” is the top searched for term. It surpasses the number of searches for
the top two and three terms (“Laptops” and “Tablets”), combined. “Desktop,” which typically made the top list up to a year ago, has become a more
niche product driven by gaming enthusiasts.
Coming in at number four is “Phone/ by “TracPhone,” the pre-paid wireless Top-Searched CE Sub-Categories
Smartphone.” But with only a quarter option, at number 19.
PS4 keyboard Chromebook
Wii
tablets iPad
TV
the number of searches as TV, this
Plenty of technology dated back to the
laptops
could reflect the lack of new products
iPhone
printers
19th century shows endurance: “cameras”
introduced over the summer: Apple
(#9) and “radios” (#20) make the list. mouse
and Google waited until September and
phones/
Seems that smartphones, despite their
October to launch new handsets.
DVD
GoPro
Swiss Army Knife quality have not killed Roku
router
Branded terms that resonate among
consumers that make the list include: the
off these products, or even GPS Devices
(#17). Despite the push to touchscreens,
smartphones
radio
“PS4,” the “iPhone,” “Roku,” “Macbook,” the “mouse” is still hot even 46 years cameras TracFones Macbook
“Wii,” “Chromebook” and new to the after its invention, as are DVD players
headphones
Beats
drone
GPS
list: “Beats.” “Headphones” have clearly (#13) and “printers” (#5).”
become a highly sought after product. CD player
A portent of the season to come, “drone”
The term comes in at number six
lands on the list at number 25. Expect
overall. The whole US does not have
Drones to get hotter as the holidays near.
a wireless subscription as evidenced
CONSUMER ELECTRONICS WHITEPAPER 20164 Lessons from Holiday 2015. CONSUMER ELECTRONICS WHITEPAPER 2016
Consumer Electronics Traffic
Conversions are more than four times the
300 Thanksgiving, Black Friday
& Cyber Monday
baseline during the week of Black Friday.
200
100
The week after Thanksgiving with Cyber
0
11/2 11/9 11/16 11/23 11/30 12/7 12/14 12/21 12/28
Monday leading into it is about two and a
Week of
Baseline: 100
half times higher than the October norm.
Consumer Electronics Traffic
Since Q4 is the biggest season for But in this category, Black Friday and
400 Thanksgiving, Black Friday
& Cyber Monday
Consumer Electronics sales, it’s important Cyber Monday deals are particularly
300 to look at the behaviors gleaned from important: Conversions are more than
200 Criteo’s online purchase data in 2015. It four times the baseline during the week of
100
shows that ecommerce sales are not Black Friday. The week after Thanksgiving
entirely focused around Black Friday is about two and a half times higher than
0
11/2 11/9 11/16 11/23 11/30 12/7 12/14 12/21 12/28 and Cyber Monday, though the week the October norm.
Week of of Black Friday is the most trafficked
period. Indeed, shoppers start early in Average cart value and the number of
Baseline: 100
this category and continue to purchase items per cart actually peak the first
through December: the traffic index is week in November: Consumers are likely
above the October baseline from the locking in hot items to ensure availability.
beginning of November through the end Cart size goes back up after Christmas:
of December. consumers may be using gift cards and
are more impulsive to splurge on things
they didn’t get under the tree.
CONSUMER ELECTRONICS WHITEPAPER 2016Looking Ahead
Average Cart Value vs. # of Items Per Cart
2.3
$250 $233
Average Cart Value
at Holiday 2016
$200 $185 1.6
2
Items per Cart
$150
$100 1
$50
$0 0
11/2 11/9 11/16 11/23 11/30 12/7 12/14 12/21 12/28
Week of (2015)
Online shoppers seem confident that that the "This Holiday Season, I Plan to Spend..."
season will be merry for those they plan to gift.
Eighty-eight percent say they will spend the
same or more. Where will they spend it? They
project that Electronics is the category they will
increase spend on while other categories will
62% 26% 8% 4 %
stay the same or decline very slightly. Electronics "About the same "More"
is now 2 points shy of the perennial favorite gift: as last year"
Clothing & Accessories for the percent of those
who plan to purchase online (34%).
"Unsure"
"Less"
Source: Criteo Online Shopping Survey, 2016
CONSUMER ELECTRONICS WHITEPAPER 20165 Conclusions. CONSUMER ELECTRONICS WHITEPAPER 2016
Electronics is a fully mature category within ecommerce,
but due to increasing product innovation and affordability,
one that offers extraordinary opportunity for marketers.
Each season consumers make the leap to buy new CE
products and competition in key categories like TVs and Your Product
Tablets is fierce. But with lots of time spent on product
research, there is plenty of room for brands to support
Create the online version Native ads on mobile mean
ecommerce sales. Criteo Sponsored Products can help of an in-store display your product never gets lost,
brands drive consideration along that involved path to by adding many angles regardless of screen size
purchase. Since we know consumers often use shopping and product shots BUY
carts as product “holders,” retargeting is an especially Featured
Campaigns should run
effective marketing tactic. throughout the purchase
cycle since Electronics
require more research
than other categories.
Make sure the campaign extends through the full length of the purchase cycle.
Consumers spend considerable amounts of time on the highest price point Put native ads to work on mobile. Consumers are increasingly researching on mobile.
items. Make sure you are in market to sway them throughout their online Native in-stream is the proven format in mobile and Criteo Sponsored products are
journey. relevant to the shopper and the products shopped.
Create the online version of in-store display. Vsibility on the site is crucial. Criteo Improve the shopper search. For sub-categories with lower conversion efficiency,
Sponsored Products can increase it. retailers should find ways to simplify the searching process, via better navigation and
information. Criteo Sponsored Products have the added impact of helping to boost
rankings in organic shopper searches.
CONSUMER ELECTRONICS WHITEPAPER 2016About Criteo
Criteo (NASDAQ: CRTO) delivers personalized performance marketing at an extensive scale. Measuring return on post-click sales, Criteo
makes ROI transparent and easy to measure. Criteo has 2,000 employees in 31 offices across the Americas, Europe and Asia-Pacific, serving
12,000 advertisers worldwide with direct relationships with 17,000 publishers.
Criteo ads reach over 1.2 billion unique Internet users (comScore, January 2016).
This and future whitepapers may be found at:
www.criteo.com/resources
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