From October 2007

Just as they do in traditional bricks-and-mortar retailing, the demographics – and, by extension, the behavior, needs and expectations – of online consumers vary widely. To gain an appreciation of just how much variance there can be, here’s a detailed look at the customer characteristics of three e-tailers that ranked near the top of the Favorite 50.

These retailers vary as much as their customers. No. 1 Amazon is the world’s largest online retailer. No. 6 Target is a large, aggressively marketed big-box chain, as well as an Amazon joint-venture partner in online retailing. No. 9 Google isn’t a retailer – which indicates that its customers are so comfortable with the search engine that they consider it their home base for online shopping.

That Amazon and Target are partners in an extensive, long-running joint venture might lead one to conclude that their respective customers have a good deal in common. As it turns out, they don’t: In fact, Amazon customers are more like Google customers than Target customers.

This is almost certainly because Target is, well, targeted: it’s trying to attract bargain hunters who also have an elevated sense of style. The demographics of its online customers – and its presence near the top of the Favorite 50 – indicate that it’s doing a pretty good job.

What lessons are there for retailers in these demographic profiles? One, made obvious not just here but throughout, is that people become website loyalists: They return time and again to that which they trust, and what they trust is usually what’s worked for them before. That means there’s a pretty small margin for error in online retailing; if they tried it and it didn’t work, there’s a fairly strong likelihood that they won’t be coming back.

It also seems clear that the retail community needs to gain greater insight into the role search engines play in online consumer behavior. The demographics for Google customers examined in this article apply to people who identified Google as the “website at which they shop most often” for apparel or non-apparel items, but a lot more people also make Google (or another search engine) part of their online shopping experience. Almost 91 percent of surveyed online shoppers perform online shopping research before buying in a store, and 43.3 percent say they do so regularly; these figures track fairly consistently across all demographic categories.

When researching products, consumers tend to start with the search engines. Combined, the responses for Google, Yahoo, MSN, Ask and AOL to the question “When you do online product research, where do you go first?” accounted for 35.5 percent of the total. Compare that with 6.8 percent for Amazon, 1.8 percent for Wal-Mart, 1.3 percent for “manufacturer’s website” and 1 percent for the generic “store’s website.”

What this ultimately means to retailers is unclear. It does seem likely, however, that search engines will play an increasing role in the way online retailers are branded, and that a relationship analogous to the one between retailers and shopping center developers will be forged between e-tailers and search engines.

It’s already there, in fact. The online leaders – Amazon is particularly adept at this – are very good at making themselves visible in a search, not just for specific products but for practically anything with which they can make a logical connection. This is an ability that will be increasingly important if, as seems likely from these figures, the search-engine-based research/refine/select online shopping model becomes more prevalent.