Zeroing In On Broadband's Smarter Shoppers
We've analyzed the various growth spurts of digital retailing since 1994. (Remember 2Market's CD-ROMs? Prodigy?) Now, almost 10 years and billions of investor dollars later, we see another significant transition on the digital retailing horizon -- the broadband revolution. With about 20% of US households now connecting via broadband, we're issuing retailers two broadband mandates:

1) Learn how broadband shoppers use your site. Our analysis shows that high-speed shoppers are younger, richer, and better informed than dial-up shoppers. These "active shoppers" spend more time and more money online. But it doesn't stop there. They research more, they're more likely to buy customized products, and they use gift, registry, and other services more frequently than their dial-up counterparts. These customers are worth winning, so retailers must segment their shoppers by connection speed, study the differences, and devise a plan to lure broadband users.

2) Prepare your site's broadband facelift. Retailers selling PCs, media products, electronics, toys, and apparel need to get busy this year -- your categories are already seeing the broadband bounce. Add tools like guided search, beefier product information, streaming media, and configurators to stay a step ahead of your competition and capture broadband customers' dollars.

Because broadband consumers shop online on different days of the week and at different times of the day than dial-up shoppers do, you'll need to learn daypart marketing and merchandising. Rethink home page merchandising, email campaigns, and the kind of customer service enhancements you can add to support broadband's active shoppers.

Even retailers like Wal-Mart or J.C. Penney that don't yet have a critical mass of broadband shoppers need to put a few key items on the drawing board -- with a goal of implementation in late 2004 or early 2005. Later this week we will publish the third part of our Broadband's Retail Revolution series, which will prioritize broadband site upgrades by category and specific retailer. If you wait too long, you'll miss out on the next significant digital retailing opportunity. And we'd hate to see that happen!



Kate Delhagen
Consumer Markets Research Director


P.S. Want to see 40,000 RFID tags in action in April? Log on to the Boston Marathon Web site on April 21. Every runner wears an RFID timing chip, so you can track your favorite runner throughout the entire 26.2 mile supply chain, er, race!