CONCEPTS AND MEASUREMENT AIO (Activities, Interests and Opinions), Life Styles, Psychographics

CONCEPTS AND MEASUREMENT

AIO (Activities, Interests and Opinions), Life Styles,

Psychographics

Four types of possessions help to make up our personal sense of self:

Body and body parts

Objects

Places and time periodsPersons and pets

Materialism is the importance a consumer attaches to worldly possessions

Materialism: You Are What You Own

Life-Style and Psychographic Analysis

Life-style refers to how people live, how they spend their money, and how they allocate their time

Life-style and personality are different, yet are closely related

The Distinction Between Personality and Life-Style:

Personality refers to the internally based dispositions of the person. In contrast, life-style refers to the external manifestations of how a person lives.

Psychographics is the quantitative investigation of consumers’ life-styles, personality, and demographic characteristics.

AIO Statements Identify Consumer Activities, Interests, and Opinions

Activity questions ask consumers to indicate what they do, what they buy, and how they spend their time.

Interest questions focus on what the consumers’ preferences and priorities are.

Opinion questions ask for consumers’ views and feelings on such things as world, local, moral, economic, and social affairs.

Survey: Internet Shopping Behavior

Research PlanInternet Purchases (Yes, No, Amount)Types of Items PurchasedAllocation of Purchases by Store TypeReasons for Not Purchasing OnlineComputer Usage (Amount and Type of Activity)Interest in and Attitudes, Opinions about

Internet ShoppingComputer LiteracyInternet SpeedDemographics

21

Who Shops?A Segmentation of

Online Shoppers & Non-shoppers

Chad AllredScott Smith

Bill Swinyard

October 2004

Gratitude for financial support is extended to:IBM CorporationJCPenney Retail Research Fund

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Study Purpose

Online Households

Shopper Strategy

What Internet shoppers seek in an on-line experience

How often, and what, they buy

Who they are

Resulting Shopper Segments

Online Shoppers

Online Non-Shoppers

Overall objective:To develop a model that defines Internet shopper segments

Research Questions

1. What are the characteristics of on-line households in the U.S.?

2. How do on-line shoppers differ from non-shoppers?

3. What are the fundamental motivators or satisfier s provided by Internet sites for these households ... and what are the dissatisfiers?

4. What are the major Internet-shopper segments?

5. What are the major Internet-non-shopper segments?

Sampled Population

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Definitions:Shoppers vs Non-Shoppers

Online Shoppers

Male or female household heads

Have access to the Internet from their home

Made a personal purchase over the Internet during November – December Y’2003

Online Non-Shoppers

Male or female household heads

Have access to the Internet from their home

Did not make a personal purchase over the Internet during November – December Y’2003

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Data Collection Methods

Secondary Research &Web Site Visits

• Revealed little information of value

Questionnaire on Internetsatisfiers & dissatisfiers

• Administered to 222 students at BYU

• Produced an attribute listing of 107 satisfiers and 54 dissatisfiers

Interviews & Focus Groups• Rhoads & Swenson’s 3 focus

groups (Salt Lake City, New York City & San Francisco)

400,000 email messagesto all 50 statesOffered drawing for five $500 prizes13,175 emails opened, 2100 q’aires completed, 15.9%23.9% Male respondents76.1% Female respondents

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Demographics

ComputerLiteracyIndex

Computer & Internet

psychographics

Hrs of computer &Internet usage,

by activity

Internet shoppingspending &experience

Crosstabulate Clusters w/Other Var’s

Analysis Procedure

Formulate the Problem

Generate Universe of Attributes,Trim to Manageable Subset

Collect Scaled Attribute Data

Factor Analyze

Cluster Analyze Factor Scores

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What They Do Online:Six Basic Activities

Use for Personal ChattingVisit message news-groupsChat on-lineFind & view photographs, clipart, or imagesSearch for or download software

Use for Peer2peer Music/Video SharingPeer-to-Peer file sharing of music filesPeer-to-Peer file sharing of video files

Use to Visit Retail SitesVisit auction sitesVisit retail sites looking for merchandiseVisit Internet sites related to my hobbiesRead on-line news or magazines

Use to Conduct BusinessConduct business-related workLook at financial information (stocks, trends)Look for job opportunitiesVisit sites looking for tickets or reservations

Use to Play GamesPlay GamesCheck or send e-mail messages

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The Online Turn-ons & Turnoffs:Five Factors

Like Online ShoppingI like having products delivered to me at home. I enjoy buying things on the Internet. I often go to the Internet for product reviews or recommendations. I like it that no car is necessary when shopping on the Internet. I often go to the Internet to preview products. I think on-line buying is (or would be) a novel, fun way to shop.I like browsing on the Internet. I think Internet shopping would avoid the hassle of local shopping. I would like not having to leave home when shopping. I would shop on the Internet (more) if the prices were lower. I always search for the lowest price in just about everything I buy. For me, shopping in stores is a hassle.

Buying Online is a HassleI don't like having to wait for products to arrive in the mail. It would be a real hassle to return merchandise bought on-line. I disklike the delivery problems & backorders of Internet buying. I dislike the idea of shipping charges when buying on the Internet. It's hard to judge the quality of merchandise on the Internet. I want to see things in person before I buy. I think local stores have better service policies than Internet stores. I often return items I have purchased. None of my friends shop on the Internet.

Like Experience of B&M ShoppingI like the "energy" & fun of shopping at local retail stores. I like to go shopping with my friends. I like the help & friendliness I can get at local stores.Don't Know How to Buy OnlineI'd have a hard time searching the Internet to find what I need. I don't think Internet stores carry things I want. I find the Internet ordering process is hard to understand & use. I don't know much about using the Internet. I often buy using lay-away or store payment programs.

Fear of Online TheftI worry about my credit card number being stolen on the Internet. Buying things on the Internet scares me. I don't want to give out my credit card number to a computer. I want my purchases to be absolutely private. I just don't trust Internet retailers.

Prices & Selection are Better OnlineI think the Internet offers lower prices than local stores. I think Internet shopping offers better selection than local stores. I think Internet shopping offers better quality than local stores. Local stores have better prices & promotions than Internet stores.

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The Average RespondentSex (M/F) 24% 76%

Age 40 ---

Status Married 59%

Children at Home

< 20 in HH 47%

Living House 66%

Inet Connect Dialup 47%

Ed Level Yrs of School 14.3

HH Income $44.6K ---

Per. Income $30.0K ---

Computer Usage/Wk

Online Hrs

Offline Hrs

23.8

11.0

What We Like About the Internet1. Browsing on the Internet.2. Search for low prices3. Previewing products4. Online shopping is or can be fun5. Shopping from home

What We Dislike About the Internet1. Shipping Charges2. The possibility of my CC # being stolen3. Difficult to judge the quality of merchandise4. The hassle of returning merchandise5. Figuring out how to shop online

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What We Do

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What We Buy

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Shoppers vs NonThe basic differences between them focus on their beliefs

about the Internet and what it is used for

Radar chart based on average factor scores where mean = 0 and sd = 1 (Anderson-Rubin coding)

Shoppers

Non-Shoppers

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Segment Overview

All OnlineHouseholds

InternetShoppers(63%)

InternetNon-Shoppers(37%)

Internet shoppers:

•5 segments

Internet non-shoppers:

•3 segments

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Segment Overview




AvertechShoppers

Chatterettes

ShoppingLovers

eShoppers

Unconcerneds

CasualBrowsers

CCInsecures

eWindowShoppers

Internet shoppers:

5 segments

Internet non-shoppers:

3 segments

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Segment Overview




• The psychographics of online shoppers differ significantly from non-shoppers

• Shoppers enjoy the overall features of the Internet and the novelty of shopping

• Non-shoppers are anxious, and even afraid of buying online

• These broad groups have been segmented by what attitude users have toward the Internet, which in turn define how they use the Internet

• Understanding these characteristics is key to understanding why people do, or do not, shop on the Internet

• To move non-shoppers to shoppers will require retailers to overcome their fear of credit card misuse, and to make the shopping experience easy & fun

• The largest deterrent to Internet shopping is fear of financial theft

• The next deterrent is lack of literacy in online procedures – “I don’t know how”

AvertechShoppers

Chatterettes

ShoppingLovers

eShoppers

Unconcerneds

CasualBrowsers

CCInsecures

eWindowShoppers

• In general, online households have a “love-fear” relationship with the Internet

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Shoppers & Non-shoppers

Shoppers63% of Online Households

Non-Shoppers37% of Online Households

* Personal Online Purchasing Share / Share of Online Shoppers

AvertechShoppers

ChatterettesShopping

LoverseShoppers

Uncon-necteds

CasualBrowsers

CCInsecures

eWindowShoppers

Market Share 8.3% 13.8% 11.3% 13.5% 16.2% 14.1% 11.8% 10.9%

HH Gift Spending

Share13.8% 15.1% 14.4% 13.5% 15.8% 9.0% 9.4% 9.0%

PersonalOnline Purch

$424 $360 $350 $448 $317 -- -- --

PersonalOnline Share

22.3% 19.0% 18.4% 23.6% 16.7% -- -- --

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Summary Demographics

eWindowCC Inse-CasualUn-con-eShop-ShoppingChatter-AvertechShopperscures BrowserscernedpersLoversettesShoppers

21.622.523.922.726.926.223.722.7Pers Wkly Hrs Online8.910.011.210.413.212.110.911.1Pers Wkly Hrs Offline

30.532.235.032.739.837.434.233.4Total Wkly Hours

-0.669-0.3080.155-0.0610.3840.4500.246-0.486Computer Lity Score

73.0%73.0%78.0%76.0%76.0%70.0%85.0%76.0%Percent Women59.0%53.0%55.0%61.0%60.0%57.0%66.0%59.0%Percent Married

40.640.239.541.640.235.939.639.6Age in years13.713.814.314.714.614.814.314.2Years of Schooling

$36.8$37.8$40.9$52.8$46.0$49.7$47.2$44.1HH income ($000)$26.4$25.2$29.4$34.2$32.4$31.0$29.6$30.4PersIncome ($000)

Shoppers Non-Shoppers

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Share of Online Spending

Share of Online Shoppers

Avertech Shoppers

76.0%Percent Women59.0%Percent Married39.6Age in years14.2Years of Schooling$44.1Household income ($000)$30.4Personal Income ($000)

Demographics Computer Use22.7Pers Weekly Hrs Online11.1Pers Weekly Hrs Offline33.4Total Weekly Hrs

-0.486Comp Literacy Score

Computer LifestylesBottom FiveI think on-line buying is (or would be) a novel, fun way to shop.I think Internet shopping offers better selection than local stores. I like browsing on the Internet. I enjoy buying things on the Internet. I think the Internet offers lower prices than local stores. Top FiveBuying things on the Internet scares me. I don't know much about using the Internet. I find the Internet ordering process is hard to understand & use. I'd have a hard time searching the Internet to find what I need. I don't think Internet stores carry things I want.

Online ActivitiesBottom FiveCheck or send e-mail messagesConduct business-related workRead on-line news or magazinesPlay gamesVisit Internet sites related to my hobbiesTop FivePeer-to-Peer file sharing of video filesVisit sites looking for tickets or reservationsPeer-to-Peer file sharing of music filesVisit message news-groupsVisit retail sites looking for merchandise

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Chatterettes

Demographics Computer Use23.7Pers Weekly Hrs Online10.9Pers Weekly Hrs Offline34.2Total Weekly Hrs0.246Comp Literacy Score

Computer LifestylesBottom FiveI think the Internet offers lower prices than local stores. I find the Internet ordering process is hard to understand & use. I think Internet shopping offers better quality than local stores. I don't know much about using the Internet. I'd have a hard time searching the Internet to find what I need. Top FiveI like having products delivered to me at home. I like browsing on the Internet. Local stores have better prices & promotions than Internet stores. I dislike the idea of shipping charges when buying on the Internet. I would shop on the Internet (more) if the prices were lower.

Online ActivitiesBottom FiveVisit sites looking for tickets or reservationsVisit message news-groupsPeer-to-Peer file sharing of video filesPeer-to-Peer file sharing of music filesSearch for or download softwareTop FiveVisit auction sitesRead on-line news or magazinesCheck or send e-mail messagesLook at financial information (stocks, trends)Visit retail sites looking for merchandise

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Shopping Lovers




Computer LifestylesBottom FiveI don't want to give out my credit card number to a computer. Buying things on the Internet scares me. I don't know much about using the Internet. I often buy using lay-away or store payment programs. I worry about my credit card number being stolen on the Internet. Top FiveI dislike the idea of shipping charges when buying on the Internet. I often go to the Internet to preview products. I often go to the Internet for product reviews or recommendations. I think the Internet offers lower prices than local stores. I think Internet shopping offers better selection than local stores.

Online ActivitiesBottom FiveLook for job opportunitiesPlay gamesRead on-line news or magazinesChat on-linePeer-to-Peer file sharing of video filesTop FiveVisit sites looking for tickets or reservationsFind & view photographs, clipart, or imagesVisit Internet sites related to my hobbiesVisit retail sites looking for merchandiseVisit auction sites

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eShoppers




Computer LifestylesBottom FiveLocal stores have better prices & promotions than Internet stores. I think local stores have better service policies than Internet stores. I want to see things in person before I buy. I disklike the delivery problems & backorders of Internet buying. It would be a real hassle to return merchandise bought on-line. Top FiveI enjoy buying things on the Internet. I would like not having to leave home when shopping. I think Internet shopping offers better quality than local stores. I think Internet shopping offers better selection than local stores. I think the Internet offers lower prices than local stores.

Online ActivitiesBottom FivePeer-to-Peer file sharing of music filesLook for job opportunitiesPeer-to-Peer file sharing of video filesPlay gamesLook at financial information (stocks, trends)Top FiveVisit sites looking for tickets or reservationsConduct business-related workVisit auction sitesVisit Internet sites related to my hobbiesVisit retail sites looking for merchandise

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Unconcerneds

Demographics76.0%Percent Women61.0%Percent Married41.6Age in years14.7Years of Schooling$52.8Household income ($000)$34.2Personal Income ($000)

Computer Use22.7Pers Weekly Hrs Online10.4Pers Weekly Hrs Offline32.7Total Weekly Hrs




Computer LifestylesBottom FiveI always search for the lowest price in just about everything I buy. I like browsing on the Internet. I want my purchases to be absolutely private. I often go to the Internet to preview products. I often go to the Internet for product reviews or recommendations. Top FiveI think Internet shopping offers better selection than local stores. I think on-line buying is (or would be) a novel, fun way to shop.I think Internet shopping would avoid the hassle of local shopping. I don't know much about using the Internet. For me, shopping in stores is a hassle.

Online ActivitiesBottom FiveSearch for or download softwareFind & view photographs, clipart, or imagesChat on-lineVisit message news-groupsLook for job opportunitiesTop FivePeer-to-Peer file sharing of video filesCheck or send e-mail messagesConduct business-related workVisit retail sites looking for merchandiseLook at financial information (stocks, trends)

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Casual BrowsersDemographics Computer Use

23.9Pers Weekly Hrs Online11.2Pers Weekly Hrs Offline35.0Total Weekly Hrs0.155Comp Literacy Score



Computer LifestylesBottom FiveI worry about my credit card number being stolen on the Internet. Buying things on the Internet scares me. I don't want to give out my credit card number to a computer. I want my purchases to be absolutely private. I just don't trust Internet retailers. Top FiveI enjoy buying things on the Internet. I think Internet shopping would avoid the hassle of local shopping. I like it that no car is necessary when shopping on the Internet. Local stores have better prices & promotions than Internet stores. I think on-line buying is (or would be) a novel, fun way to shop.

Online ActivitiesBottom FiveVisit retail sites looking for merchandiseVisit message news-groupsFind & view photographs, clipart, or imagesLook at financial information (stocks, trends)Visit auction sitesTop FiveChat on-linePlay gamesSearch for or download softwareLook for job opportunitiesCheck or send e-mail messages

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CC Insecures

Demographics73.0%Percent Women53.0%Percent Married40.2Age in years13.8Years of Schooling$37.8Household income ($000)$25.2Personal Income ($000)

Computer Use22.5Pers Weekly Hrs Online10.0Pers Weekly Hrs Offline32.2Total Weekly Hrs




Computer LifestylesBottom FiveI enjoy buying things on the Internet. I think on-line buying is (or would be) a novel, fun way to shop.I like having products delivered to me at home. I think Internet shopping would avoid the hassle of local shopping. I would like not having to leave home when shopping. Top FiveI want to see things in person before I buy. I just don't trust Internet retailers. I worry about my credit card number being stolen on the Internet. I don't want to give out my credit card number to a computer. Buying things on the Internet scares me.

Online ActivitiesBottom FiveVisit retail sites looking for merchandiseVisit auction sitesConduct business-related workVisit sites looking for tickets or reservationsLook at financial information (stocks, trends)Top FiveLook for job opportunitiesVisit message news-groupsChat on-lineFind & view photographs, clipart, or imagesPlay games

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eWindow Shoppers

Demographics Computer Use21.6Pers Weekly Hrs Online8.9Pers Weekly Hrs Offline

30.5Total Weekly Hrs-0.669Comp Literacy Score



Computer LifestylesBottom FiveI enjoy buying things on the Internet. I think on-line buying is (or would be) a novel, fun way to shop.I often go to the Internet to preview products. I like browsing on the Internet. I often go to the Internet for product reviews or recommendations. Top FiveBuying things on the Internet scares me. I don't know much about using the Internet. I don't think Internet stores carry things I want. I'd have a hard time searching the Internet to find what I need. I find the Internet ordering process is hard to understand & use.

Online ActivitiesBottom FiveVisit retail sites looking for merchandiseVisit auction sitesCheck or send e-mail messagesVisit Internet sites related to my hobbiesVisit sites looking for tickets or reservationsTop FiveVisit message news-groupsChat on-linePeer-to-Peer file sharing of music filesLook for job opportunitiesPeer-to-Peer file sharing of video files

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Summary of Segments

AvertechShoppers

ChatterettesShopping

LoverseShoppers

Uncon-necteds

CasualBrowsers

CCInsecures

eWindowShoppers

Market Share 8.3% 13.8% 11.3% 13.5% 16.2% 14.1% 11.8% 10.9%

HH Gift Spending Share

13.8% 15.1% 14.4% 13.5% 15.8% 9.0% 9.4% 9.0%

PersonalOnline Purch

$424 $360 $350 $448 $317 -- -- --

PersonalOnline Share

22.3% 19.0% 18.4% 23.6% 16.7% -- -- --

* Personal Online Purchasing Share / Share of Online Shoppers

AvertechA small but top online buying group, still fearful of technology & low in computer literacy. Lower HH income & education than other groups, With more online experience will likely become online shopping champions.

ChatterettesA less active online buying group – above avg in comp literacy – that loves email, online news, forums, & window shopping. Largest % of women & marrieds.

LoversA high literacy & youthful group that loves shopping everywhere – offline & online. Love checking out products online, & have high online potential but need training to ease their way further into on-line buying.

eShoppersLove buying online, having the highest share of online spending. Consider online shopping superior in nearly every way. This is likely the group that are opinion leaders for all things on-line. Retailers should nurture and cultivate.

UnconnectedsTho avg in computer literacy, this wealthiest of all segments is less involved with computers than other groups, They do buy online, but the online experience is not a high priority for them.

BrowsersOn the cusp of online buying. Capable Internet & computer users, like browsing. They assist those in their HH to buy online but do not do so them-selves. Have reasonable computer literacy & spend more time with their computers than other non-shoppers..

InsecuresAfraid, lack trust, this lowest computer literacy & income segment wants to see things before they buy, like B&M shopping. Values are inconsistent with online shoppers. Not an attractive market for online retailers.

eWindowUntrained about online buying, like online chatting, news, & sharing. Values are inconsistent with online shopping. While some of these values could be overcome, the spending power of the segment suggests that only a long-term payback would be possible.

Documents

CONCEPTS AND MEASUREMENT AIO (Activities, Interests and Opinions), Life Styles, Psychographics