Report: 18% in Internet Shoppers Account for 46% o
New York, NY, December 5, 2005– Nielsen//NetRatings reported that nearly a fifth of the online buying population, or 18 percent, accounts for nearly half, or 46 percent, of total online spending.
These buyers, dubbed “Most Valuable Purchasers” (MVPs)by Nielsen//NetRatings, spend more dollars online and make more purchases on the Internet than the rest of the online buying population.
The Nielsen MegaPanel online retail study segmented online shoppers into four categories based on the amount of their online spending (low or high) and their frequency of purchases (low or high).
The MVPs, shoppers who spent the most money online and made the largest number of purchases, comprised 18 percent of the online buyers, driving 46 percent of total online spending (see Table 1). In comparison, those spending the fewest dollars online and making the fewest purchases made up the majority, or 55 percent, of online buyers; this group accounted for 21 percent of online purchases.
“Each retailer needs to analyze its own customer base to identify its respective MVPs and develop targeted marketing programs that will maximize revenue from these shoppers,” said Heather Dougherty, senior retail analyst, Nielsen//NetRatings. “Not only are the MVPs valuable based upon sales and number of purchases, they are also inordinately loyal to the retailers that they purchase from.”
MVPs are heavy users of comparison shopping tools as compared to other online buying segments. In addition, they skew towards a higher household income, are more likely to be connected via a broadband connection, and are heavier Internet users in both overall time spent online and time spent on retail Web sites.
“Customer acquisition strategies need to include a combination of broad reach marketing tactics, including search and comparison shopping tools, as well as targeted Web sites that are frequented by the MVPs. Online retailers also need to tailor loyalty programs that reward the MVPs for purchasing at their sites to drive repeat sales and maintain a strong relationship with these valuable customers throughout the year,” continued Dougherty.
