State of Online Shopping 2010

Sara Kleinberg, Google’s Group Product Marketing Manager: Retail & Tech

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1 What we learned from Holiday 2009

2 What’s the same?

3 What’s new?

4 Recommendations for Holiday 2010

Content

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1. Shopping starts early and ends late

2. Coupons still reign

3. Holiday search volume is rising

Holiday 2009

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Shopping starts early and ends late

4

Had already started holiday shopping.

44% Had yet to start

holiday shopping.

14%

As of August, 30, 2009… As of December 20, 2009…

Source: Google/OTX Consumer Pulse Check, 8/09-12/09. Base: Those who plan to shop/research or purchase this holiday season (Nearly 9 out of 10 plan to shop/research or purchase.) [1] Have you started your 2009 Holiday shopping/researching? [2] Have you started your 2009 Holiday purchasing? Please think of any gifts that you may shop for or purchase during the Holiday Season, as well as those you may shop for or purchase after the holidays. .

Google Confidential and Proprietary

Coupons still reign

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Average Monthly Coupon Searches on Google:

coupons bed bath and beyond coupons best buy coupons victoria’s secret coupons lowes coupon jcpenney coupons dominos coupons pizza hut coupons enterprise rental car coupons home depot coupons printable coupons macy’s coupons target coupons kohls coupons michaels coupon

Non-Holiday Months

coupons bed bath and beyond coupons best buy coupons victoria’s secret coupons lowes coupon jcpenney coupons dominos coupons pizza hut coupons enterprise rental car coupons home depot coupons printable coupons macy’s coupons target coupons kohls coupons michaels coupon old

38%

Holiday Months

Source: Google Internal. Average monthly search volume on top 100 coupon-related terms on Google for February through September 2009 compared against the average monthly for October through January.

Google Confidential and Proprietary

Holiday search volume is rising

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“Black Friday”

“Cyber Monday”

+20% Searches for ‘black friday’ increased 20% last holiday season.

Searches for ‘cyber monday’ increased 60% last holiday season.

+60%

Searches on key dates increased substantially in 2009.

Source: Google Insights for Search, 2009; comScore Press Release, 12/09.

Data from google.com/insights/search

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1. Shoppers like hot products

2. Holiday is in full swing

3. Key shopping dates

What’s the same?

Google Confidential and Proprietary 8 Source: Google/OTX State of Shopping research, May 2010. Q: What is one item that you are most excited about shopping for this year?

Consumers want electronics, apparel & travel

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Products to watch: 3D TVs

300% growth in 3D TV searches since the beginning of 2010.

Source: Google Internal data. Search volume reflects weekly averages from January 2010-July 2010.

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Products to watch: Tablets & eReaders

An estimated 11 million tablet PCs and 10 million eReaders will ship this year worldwide.

Source: ABI research (July 2010) and Digitimes research (March 2010).

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Rising product searches: Retail

Apparel, Clothing Labels & T-Shirts

Silly bandz Mens wallets sandals Flip flops

crocs

Golf shoes Summer dresses

swimsuits Bathing suits shorts

Toys & Video Games

Super soaker hammock Water table sandbox

Ben 10

Hammock stand Toys r us

Harry potter lego kites Little tikes

Gems & Jewelry

& Watches

Mothers rings Mood rings Tiffany engagement rings Chrome hearts

Turquoise ring

Platinum engagement rings Swarovski crystals

Indian jewelry

Mario galaxy 2 Mario galaxy

Opal rings Sapphire engagement rings Michael kors watch Ceramic watch

Halter dress Free weezy shirt

Source: Google insights, rising product searches Apr – Jul 2010. Apparel, Clothing Labels, T-Shirts, Toys, Video Games, Gems & Jewelry, Watches categories.

Data from google.com/insights/search

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Consumer Electronics

& Accessories

lcd tv 1080p home projector ipad blu ray player

3d tv

klipsch image s4 flip

ipod touch kindle reader bose sounddock portable

Computers &

Accessories

dell streak sony tx5 toshiba nb305 sony vaio notebook

sony vaio z

hp tablet lenovo tablet

hp dv2000 macbook pro sleeve dell mini 10

Mobile Phones

& Accessories

iphone 4 htc evo 4g samsung vibrant htv incredible

htc aria

nokia nuron motorola i1

iphone 4 cases

macbook pro dell latitude

nokia 5230 samsung galaxy htc droid nokia x6

nook outdoor speakers

Source: Google insights, rising product searches Apr – Jul 2010. Consumer electronics, laptops and mobile phones.

Rising product searches: Tech Data from google.com/insights/search

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By the end of summer, 1 in 3 consumers will have started shopping

Start of holiday shopping/research

Already Started by

May

June-August

Sept

Oct

Nov

Dec

Xmas/ Holiday Season

Source: Google/OTX State of Shopping research, May 2010. Q: When do you plan to start your 2010 Holiday shopping/researching?

21%

14% 12%

18% 21%

9%

5%

35%

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Holiday 2009 Key E-Commerce Days ($ Millions), % Growth (YoY) Mon Tue Wed Thu Fri Sat Sun

Nov 23 24 25 26 27 28 29

30 Dec 1 2 3 4 5 6

7 8 9 10 11 12 13

14 15 16 17 18 19 20

21 22 23 24 25 26 27

Thanksgiving $318, +10%

Black Friday $595, +11%

Cyber Monday $887, +5%

Thanksgiving Weekend $805, +5%

$886 $797

$828 $852

Green Monday $854, -1%

Green Tuesday $913, +21%

$874 Free Shipping Day $809, +6%

$803

Weekend Before Christmas $767, +13%

2009 Online Holiday Sales

Source: comScore Press Release, 2009.

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1. Thrill of the hunt

2. Rise of the personal shopper

3. We’ve made new friends

What’s new?

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Thrill of the hunt

Private Sales Sites Group Buying Sites

+2x site visits YoY $900M in 2010 revenue

+72x site visits YoY $350M in 2010 revenue

Source: Assorted company press releases, Google/Compete State of Shopping, May 2010 and Hitwise Blog, April 23, 2010. Note: Group buying site estimated revenue includes Groupon, Woot, Living Social and Tippr. .

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Rise of the “personal” shopper

Source: Compete, “Understanding Smart Phone Owners,” June 14, 2010

Use a mobile device to . . .

Mobile Shoppers

Compare prices/products 22% Look up product information 21% Browse for products 19% Check product availability 13%

Look for a coupon 13%

Purchase a product 13%

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one or two 18%

18

zero

55%

three or four 11%

five to nine 10% ten or more

6%

Average number of brands US users are fans of on Facebook

Friends: Half become pals

Source: Chadwick Martin Bailey and iModerate Reach Technologies as cited in press release, March 10, 2010. Ages 18+. . .

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Friends with benefits

To receive discounts

and promotions

25%

110% It’s fun & entertaining

Why I became a “fan” of a brand on Facebook:

18%

18%

To show others I support the brand

To hear new info first

Source: Chadwick Martin Bailey and iModerate Research Technologies as cited in press release, noted in eMarketer, March 10, 2010. Ages 18+. Note: Respondents are fans of at least one brand. .

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Friends are engaging

% of new brand followers to visit brand site

+34%

+24%

Pre- Friending

Post- Friending

Pre- Friending

Post- Friending

Source: Google/Compete State of Shopping, May 2010.

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Friends: Mere acquaintances

57% Start with a search engine

20% View a brand’s site

18% Research at a retailer

3% Use social network sites

2% Pose a question on Twitter

Sources used to begin a product search

Source: PowerReviews and the e-tailing group, “2010 Social Shopping Study,” provided to eMarketer, May 3, 2010.

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Search: stocking stuffer

% of all shopping conversions indexed to % of total site traffic

Social Media

Source: Google/Compete State of Shopping, May 2010.

Search

Social Media

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1. Game on! Start early, end late

2. Incentivize shoppers with promotions

3. Integrate marketing channels

Recommendations

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123 Days

days until

Game on! Start early, end late

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Promote sales, coupons & free shipping

Offers/Promotions that are Effective in Encouraging Purchase

Source: Google/OTX State of Shopping, May 2010. Q: Which of the following offers or promotions would persuade you or help make up your mind to purchase a product when shopping? Select all that apply.

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Provide value options

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Coordinate Search with catalog drops

June 2010 Catalog +55% in online orders

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Integrate across channels

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Feed what works

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Search campaigns drive to twitter pages…

… user tweets reveal trends & inform future search campaigns.

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Marketing Recommendations for Holiday 2010

1 Start early, end late Holiday starts now. Capture procrastinators. Target key dates.

2 Offer value Consumers are trained. Do what’s expected.

3 Make it fun! Squelch lingering economic concerns. Play to suspense. Make it social.

4 Integrate marketing channels Use Search to boost other promotions. Pay attention and be nimble.

5 Focus on proven channels Shopping starts and ends with Search.

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Thank You googleretail.blogspot.com