London, UK (Gawkwire.com) Brands that fail to embrace and engage in online consumer dialogues are set be amongst those most severely affected by the expected economic downturn.
Released today, research conducted by E-consultancy, Logan Tod and immediate future, reveals that 64% of respondents will reduce their spending generally in view of the deteriorating economic climate. However, 56% said that their online spending will either not be affected, or would actually increase.
The survey shows that with increasing fears surrounding the credit crunch, falling house prices and worsening economic conditions, consumers are turning online to find both the best available prices and advice.
Online retail has seen a continual growth in 2008, with online spend up 38% on the first half of 2007, now accounting for 17p of every pound spent in the UK*. A large proportion of consumers are turning to comparison engines and user reviews before taking the final purchase decision. 62% of respondents said that they are now more likely to consult reviews written by other web shoppers before buying.
Whilst women are more inclined to reduce overall spending during the economic downturn, they are also more likely to consult online reviews than men (64% compared to 58%).
Katy Howell, MD of social media specialist immediate future, comments "The research clearly highlights the importance of online interaction between consumers when faced with purchasing decisions. Whether it is with blogs, comparison sites, or user reviews, brands need to understand and engage with social media to survive the expected economic downturn."
When comparing the different age groups, it is the ‘silver surfers’ (aged 55 and over), many of whom have paid off mortgages or enjoy higher disposable income, who are the least concerned about the economic situation (43% said that the economy would not affect their spending), followed by the 16-24 age bracket (37% wouldn’t change their spending levels).
Matthew Tod, Logan Tod CEO, explains "It is clear from this research that online strategies will have to become far more sophisticated to weather the economic slowdown. A one size fits all strategy will no longer be the most effective and online retailers will have to start to segment their audience and match their marketing activity to each group"
For more information please visit http://www.e-consultancy.com/publications/Online-shopping-and-credit-crunch-survey-report/