Shoppers that purchase items priced at $500 or more are spending less time on the path to purchase than they have in the past, according to data from Synchrony Financial. These “major purchase” journeys took 63 days on average in 2016, five days less than the 68-day average last year. This purchase path is a full 17 days shorter than it was two years ago, when it lasted an average of 80 days.
While these consumers are making their decisions more quickly, their interest in deals remains sky-high even in an improved economy:
90% of Synchrony cardholders compare prices and promotions to ensure they get the best prices;
82% still wait to make a purchase until they get the best deal; and
59% would never pay full price for an item.
“During the recession, we closely tracked how the pressure put on consumers was impacting their deal orientation,” said Ronda Slaven, VP of Market Research and Consumer Insights at Synchrony Financial in an interview with Retail TouchPoints. “So many of them had to buckle down or became wary about making sure they got the best deals. The number of value-driven consumers slowly started to increase coming out of 2010 and 2011 and they got to a point where more than 80% said they were looking for value every time they made a purchase. We thought we would finally max out as we exited the recession, but we’re way past that as the market today is still uneasy about the economy.”
These attitudes toward the economy make financing a viable consideration for many shoppers making a major purchase. Nearly half of all shoppers surveyed in the report said they would not have made the purchase, or would have gone to another retailer, if financing options were not available.
Online Research Sparks Shorter Purchase Journeys
The shrinkage of major purchase journeys may be aided by the consumers' increased ability to find the information they need about merchandise online. As many as 85% of major purchase shoppers report starting their research online in 2016, compared to 80% last year. Additionally, online buying among major purchase shoppers surveyed rose to 18% from 13% last year, showing that consumers are becoming more comfortable spending significant capital on merchandise they haven’t yet seen in person.
“As shoppers are conducting more online research, we’re seeing that deal orientation is growing,” said Slaven. “I truly believe there is a connection there, which is that consumers tell us they’re finding better deals online, and they’re finding better value. It’s no surprise then that we’re training consumers to be more deal oriented and to have that mindset.”
The research process spans multiple digital assets:
68% of shoppers surveyed visited the retailer’s web site;
More than 60% used search engines;
More than 50% also viewed the manufacturer’s site; and
Approximately 40% used aggregators to compare products and reviews.
“If you’re a retailer that plays in both channels, you definitely have to be thinking about that online channel and what you need to have there, whether it’s optimizing the search engine strategy or the web site,” Slaven said. “It’s getting harder for brands over time with all the noise and options consumers have online.”
To craft its 5th Annual Major Purchase Consumer Study, Synchrony explored the shopping and spending preferences of more than 2,700 consumers who made a purchase of $500 or more in the first six months of 2016. The purchases varied across 13 retail categories: appliances; automotive service and products; electronics; eyewear; fine jewelry; flooring; home improvement; furnishings; bedding and mattresses; lawn and garden; musical instruments; sewing; and sports and fitness equipment.