According to new research from PricewaterhouseCoopers, U.S. teens are spending a considerable amount of time online, but rarely spend it shopping.
The international consulting firm’s latest “E-Retail Intelligence System” survey showed that only 2 percent of 13 to 18 year-old Internet users cited shopping as their primary reason for going online.
While 76 percent of adult Internet shoppers have made a purchase online, only 31 percent of connected teens have bought something from an Internet shopping site. Another 25 percent of teens have browsed online shops without making a purchase.
Online merchants should not give up on capturing some of the billions of dollars (US$) spent annually by teen shoppers, according to Mary Brett Whitfield, principal consultant and director of the PricewaterhouseCoopers E-Retail Intelligence System. She said, “E-retailers who capture teens’ attention can tap into a market of Internet savvy customers whose purchasing power is sizeable today and will undoubtedly increase in years to come.”
According to the survey, teens are tech-savvy, but do not go online quite as often as adults do. Only 38 percent of teenaged Internet users access the Web more than once a day, compared with 52 percent of adult Internet users. Another 24 percent of teens connect just once a day and eight percent go online less than once a week.
Additionally, according to PricewaterhouseCoopers’ consumer research, families with teens are more likely to have Internet access than other households.
The good news for e-tailers is that once teens get online, they tend to stay connected. Survey results indicate that more than one in four teens stay online for at least an hour during a typical visit. The challenge for online retailers is to convince those teens to spend their dollars while they browse the Web.
The length of time spent online also corresponds to how often a teen enters cyberspace. Teens accessing the Internet more than once a day are more likely to spend an hour or more on each online visit. Conversely, teens accessing the Internet on a weekly basis are likely to spend less than 30 minutes online.
Parents Hold the Purse Strings
One big reason for the discrepancy in online spending is that a teen frequently has to ask a parent for a credit card to buy something on the Internet. According to survey, 78 percent of teen purchases were paid for with parents’ charge cards.
“The fact that most teenagers are not independent consumers presents e-retailers with a unique set of challenges,” said Whitfield. “When teen Internet users were asked to identify the three biggest challenges they have with online shopping, parents not letting them make online purchases topped the list. This suggests that online retailers seeking to capture a teenage market may want to make an effort to target parents as well.”
Whitfield suggested that e-tailers come up with “creative methods to e-commerce enable teens.” She said, “Digital wallets and other prepaid online spending accounts may take the risk away from parents who are hesitant to give teenagers access to their credit cards, while giving teenagers budgetary responsibilities.”
In addition to parental restrictions, teens cited several other obstacles to shopping online, including the inability to touch or try products before purchase, cumbersome return procedures, lack of money, and privacy issues.
“Very few teens admitted to having no problems with online shopping,” said Whitfield. In fact, one in five teens said that nothing would make them more likely to purchase online in the future.
What Teens Are Buying
The survey also revealed that when teens spend their money online, they tend to purchase the same products as adults.
The top five types of purchases made by teens, based on sales volume, are CDs/cassette tapes, clothing, books, computer software and toys.
While the majority of adults purchase the same types of products, they have different priorities when shopping online. Adults’ top five purchases, based on sales volume, are books, CDs/cassette tapes, computer software, toys and clothing.
The fact that clothing is number five on the adults’ shopping list, but number two for the teens, represents an “obvious opportunity for teen apparel retailers,” according to PricewaterhouseCoopers.
What Teens Are Doing Online
The primary reason for going online given by 44 percent of teens was to send and receive e-mail. Other reasons included researching information, cited by 19 percent of teens; playing games, 10 percent; using chat rooms, 10 percent; downloading music or videos, 6 percent; shopping 2 percent; and reading news, 4 percent.
The survey showed that while few teens are spending money online, 70 percent of them are accessing online shopping sites to take advantage of their other features, including e-mail, online newsletters, articles, reviews, celebrity interviews, fashion advice, and store and product information.