What inspires consumers to buy products online?
Marketers and small businesses are faced with more and more ways to reach their audiences. Understanding which mediums are most likely to influence consumers’ online behavior is critical as they allocate marketing budget. Typically, research tries to provide guidance to this dilemma by asking a group of seasoned marketers which mediums they plan to invest in.
In this research, customer experience automation company ActiveCampaign surveyed consumers to directly understand what drives their online buying behavior. The study assumes that the first action an online shopper will take to express interest in a product can be:
- Click a link to learn more
- Type in the brand domain directly
- Run a search for the product or brand
In this study, we refer to this phase of the buying process as ‘research’. With that concept defined, we wanted to identify:
- Which mediums are most effective at inspiring shoppers to start that research phase?
- If a shopper doesn’t buy at first glance, which mediums are most effective at re-engaging them and driving to purchase?
- Which mediums are most effective at inspiring repeat online product purchase?
Out of 11 different common advertising and promotional mediums, 546 online shoppers said social media ads are most effective at inspiring product research, product mentions are most effective at re-engaging abandoned shoppers, and emails from brands are most effective at inspiring repeat purchases.
An online survey was administered to a sample of 546 U.S. consumers. Gender and age demographics match the distribution found in U.S. census data.
Respondents were asked a series of questions about their online shopping habits when shopping for products priced under 200 U.S. dollars. Possible responses to questions were randomized to avoid order effects.
Notably, this research used a sample of U.S. consumers rather than business analysts or marketing experts. The intention was to better understand the relative influence of different advertising mediums on purchase behavior.
Social media ads are most effective at inspiring product research
Social media ads most frequently inspired product research.
The three mediums that most frequently inspired product research were:
- Social Media Ad (23%)
- Product Mentioned in an Article (21%)
- TV Ad (15%)
This study found that social media ads were the most frequent inspiration to research a product, followed closely by product mentions in articles. Of consumer respondents, 23% listed “Social Media Ad” as the medium most likely to inspire product research.
Social media ads are an extremely popular method of marketing – and the low cost of entry makes such ads accessible to small businesses. Research from AdEspresso found that Facebook ads have low cost-per-click (CPC) relative to other channels. Other research has found that Facebook ads can positively impact purchase intention.
Television ads placed third on the list of mediums that inspire product research. The popularity of digital channels may lead marketers to focus more of their attention online. However, research from Nielsen suggests that TV advertising still has greater reach than digital-only marketing. Although the minimum spend for TV ads is substantial, one report from Effworks (using data from the IPA Databank) suggests that reach and mass marketing are still powerfully effective for those who can afford them – and Digiday reports that some direct-to-consumer (DTC) brands are allocating more budget towards television.
This research found that TV ads can inspire new product research. Notably, the effectiveness of TV ads changed substantially based on demographics. TV ads were most effective at reaching respondents above 45 years old.
Product mentions are most effective at re-engaging abandoned shoppers
Products mentioned in articles were the most likely to recapture customers who did not make impulse purchases.
If shoppers did not purchase the first time they viewed a product, these mediums were most effective at winning their purchase:
- Product Mentioned in an Article (28%)
- Social Media Ad (16%)
- Email from Brand (15%)
This study found that product mentions in articles most frequently inspired product purchases, followed distantly by social media ads and emails from brands. Of consumer respondents, 28% listed “Product Mentioned in an Article” as the medium most likely to inspire product purchases.
Having a product mentioned in an article may help expose that product to new audiences. Additionally, third-party publications may be more credible than materials produced by a brand. A DemandGen Report suggests that B2B buyers, in particular, place more importance on peer reviews, third-party publications, and user-generated feedback.
Intuitively, when combined with this study’s findings on product research, it’s easy to imagine the consumer experience:
- Via a third-party article, find out about a new product that seems interesting
- Research the new product (and likely encounter additional third-party articles)
- Make a purchase decision based on research
Social media ads appear again in the top three mediums, this time occupying the number two position.
Social media ads are effective at inspiring product purchases, likely because of their high relevance and low friction. Facebook releases some information about its own targeting capabilities – and reporting by Wired suggests that the scope of Facebook’s targeting is quite a bit larger. Some research suggests that it may be possible to target people based on their personalities. Research published in the Journal of Consumer Research found that targeted ads become more persuasive when consumers realize that they are being targeted.
Finally, 15% of consumers stated that email marketing from brands most frequently inspired product purchase.
Email is the digital extension of direct marketing, which is marketing characterized by sending an individual message to each consumer. Research reported in AdWeek shows that email marketing is the most popular form of direct response today. The Direct Marketing Association reports that email has an average return-on-investment of $38 for each dollar spent.
In the 2018 Adobe Consumer Email Survey, 50% of respondents listed email as their preferred way to receive messages from brands. Further research shows that consumers are more likely to respond to emails that are personalized and relevant. Email marketing is likely effective because it allows marketers to communicate directly with consumers.
Emails from brands are most effective at inspiring repeat purchases from a brand
Email marketing was most likely to inspire people to purchase from a brand again.
What inspires people to purchase from a brand more than once? The three mediums that most frequently inspired repeat purchases from a brand were:
- Email from Brand (28%)
- Product Mentioned in an Article (18%)
- Social Media Ad (14%)
This study found that emails from brands most frequently inspired repeat product purchases, followed by product mentions in articles and social media ads. Of consumer respondents, 28% listed “Email from Brand” as the medium mostly likely to inspire repeat product purchases.
As discussed in the previous section, email marketing is likely to be effective because it allows marketers to communicate directly with potential customers. Because email marketing lists often include a high percentage of past customers, it seems reasonable that email marketing would be the channel of choice to inspire repeat purchases.
Research shows that one-third of retail email list subscribers have made a purchase from that retailer. Additionally, according to Adobe, “In the US, 40% of revenue comes from returning or repeat purchasers, who represent only 8% of all visitors.” For email marketing in particular, sender familiarity plays a role in open rates.
Demographics were again relevant to medium rankings for this question. Respondents under 45 years of age ranked “Recommendation from a Social Media Personality” as influential far more often than those in the 45+ demographic. Among the 44 and under crowd, recommendations from social media personalities rose to the third most influential advertising medium, displacing social media ads.
Appendix: Purchase size and frequency
This research was intended to examine the role of various advertising mediums in affecting purchase behavior. As such, additional questions were asked to determine:
- How often respondents purchased products online
- How much product research respondents conducted before purchases of up to $200
The majority of respondents made online purchases at least a few times per month.
In this research, 81% of respondents reported making online purchases at least a few times per month.
The high frequency of purchases and representative nature of this sample suggest that understanding mediums that influence purchase behavior could have substantial benefits for ecommerce businesses.
The effect of purchase size on product research
Respondents were asked about the purchase behavior in their first time researching products of different costs. Specifically, respondents were asked about four price points:
- Purchases of 25 U.S. dollars or less
- Purchases between 25 and 50 U.S. dollars
- Purchases between 50 and 100 U.S. dollars
- Purchases between 100 and 200 U.S. dollars
The results supported the expected trend – respondents were less likely to purchase expensive products in their first research session.
43% of respondents “often” or “very” often purchase a <$25 product in their first research session.
35% of respondents “rarely” or “hardly ever” purchase a $25–$50 product in their first research session. 36% of respondents made such purchases “about half the time.”
60% of respondents “rarely” or “hardly ever” purchase a $50–$100 product in their first research session.
73% of respondents “rarely” or “hardly ever” purchase a $100–$200 product in their first research session.