Survey Monitor December 2004

Consumers plan to expand Web purchase categories this holiday season

A report by New York-based JupiterResearch, Holiday 2004 Forecast: Consumers Look to Online For Inspiration and Planning, estimates that online retail holiday sales for the period of November and December 2004 will reach $21.6 billion, a 19 percent increase compared to the same period in 2003. Online sales continue to experience double-digit increases, versus uneven growth offline, primarily due to the growing number of online buyers; 86 million U.S. residents are expected to make holiday purchases online this year compared to 73 million last year, an 18 percent increase. In addition, JupiterResearch forecasts a 2 percent increase in spending per buyer compared to last year.

While the usual list of top-selling categories - toys, books and apparel - still dominates consumers’ planned purchases this year, consumers say they will buy a wider variety of items online this year than in years past. This data reinforces the overall trend of consumers increasing the number of categories they purchase online.

“Consumers use the Internet to get inspiration as well as to find good prices at the holidays,” says JupiterResearch Retail Analyst Patti Freeman Evans. “Over half of online holiday shoppers say they will use the Web to get gift ideas or to seek better prices. To capture these customers this holiday season, retailers are wise to use e-mails to alert customers who have left items in their shopping carts or wish-lists when the price changes or inventories get low on those items. Also, shoppers say that many messages will influence them to buy earlier this holiday season, with free shipping topping the list once again this year. However, as the season winds down, online holiday shoppers say that messages on reliable delivery, in-stock reassurance, and complimentary upgrades to overnight shipping will resonate.” For more information visit www.jupitermedia.com .

Kids want electronics this year

According to the KidzEyes Holiday Wish List and Habits survey from C&R Research Services, Chicago, toys are out and electronics are in for Christmas this year. When asked what they would prefer, toys or electronics, 78 percent of the kids surveyed chose electronics. Toys also lost to money (68 percent chose money over toys) but beat clothes (45 percent chose clothes versus 55 percent for toys).

Kids think their parents will give them the most gifts this year, with 33 percent of kids saying parents will give them five to 10 presents. According to kids other gift-givers will give them one to two gifts (grandparents - 40 percent; aunts/uncles - 44 percent; friends - 42 percent).

One-quarter (25 percent) of kids surveyed said they pay for holiday gifts they buy with their own money. However, mom and dad do augment kids’ holiday budgets: 45 percent of kids said they use both their own and their parents’ money.

Fifty-nine percent said they save money to buy holiday gifts. Of those kids who save money to buy holiday gifts, more than one-third plan on spending between $25-$50. Nearly one-quarter (24 percent) plan on spending $51-$100 while 23 percent plan on spending less than $25.

When it comes to preparing for the holidays 64 percent of kids say that their moms bear the brunt of responsibility, versus a mere 1 percent of kids who say dad does his fair share.

According to kids, 25 percent of dads shop for their wives the week before Christmas, while another 13 percent said their dads scour the stores on Christmas Eve.

This year, nearly half of kids (48 percent) said they would ask their parents to donate some of their allocated “gift” money to charity. For more information visit www.kidzeyes.com .

Many Internet households ready to switch to bundled services

Over 60 percent of all Internet households would be willing to consolidate their services under a single provider if so doing saved $20 per month, according to Bundled Services: Analysis and Forecasts, a new industry report from Parks Associates, a Dallas research firm. This prospect of cost savings far outweighs convenience as an influencing factor, for only 43 percent of these households would switch to a video, telephone, and Internet bundle without a savings incentive.

“Cost is important to subscribers, and at least some savings must be a central theme of any successful campaign for bundled services,” says William Cheek, an analyst with Parks Associates. “The challenge for service providers will be to not simply underprice their service packages in a shortsighted attempt to stem churn and attract new customers. Instead, they will need to define value to their customers in a way that includes such variables as the convenience of all services on one bill, one point of contact for service issues, and value-added features and applications that can be layered upon basic services.”

The study, based on an Internet survey of over 4,000 households conducted by Parks Associates, also found that 74 percent of households likely to upgrade to broadband Internet in the next 12 months would subscribe to a bundled service package that could save them $20 per month for data, voice and video services.

“This is encouraging for service providers,” Cheek says. “As more households switch from narrowband to broadband, the number of households with bundled services could increase almost in tandem, provided that providers offer and adequately demonstrate the value - above and beyond cost savings - of these options.” For more information visit www.parksassociates.com .

Football beats baseball as favorite sport

For the second year in a row, professional football leads baseball by two-to-one (30 percent to 15 percent) as the nation’s favorite sport. Nineteen years ago, in 1985, when The Harris Poll first asked this question, professional football and baseball were in a virtual tie (24 percent to 23 percent) for first place. With a few small wobbles in the numbers, football (up 6 points since 1985) has steadily increased its following at the expense of baseball (down 8 points since 1985).

While baseball (15 percent) has slipped badly, it is still ahead of college football (11 percent), men’s pro basketball (7 percent), auto racing (7 percent), and men’s college basketball (6 percent). These are the results of a nationwide Harris Interactive survey of 2,555 U.S. adults surveyed online between September 20 and 26, 2004.

With the exception of pro football and baseball, the numbers of people naming sports as their favorites are not very different from what they were in 1985. However, some sports have moved up and down over the last 19 years. In the late 1990s, when Michael Jordan was at his peak, those picking men’s pro basketball as their favorite sport increased, from only 6 percent in 1985 to 13 percent in 1997 and 1998. It has now slipped back to 7 percent.

Men’s tennis was the favorite of 5 percent of U.S. adults who follow more than one sport in 1985; it has now slipped to 1 percent.

The survey also found some sizable differences between different segments of the population. Pro football has more fans among Generation X, those aged 28-39 (42 percent), in two incomes groups, those with household incomes of $15,000 to under $25,000 and $50,000 to under $75,000 (both 40 percent), in the East (38 percent) and among African-Americans (38 percent).

Baseball does best among U.S. adults who follow more than one sport with household incomes of between $35,000 and under $50,000 (22 percent) and with matures, aged 59 and over (20 percent).

College football is particularly popular in the South (19 percent), among college graduates (19 percent) and adults in more households with incomes of $75,000 or more (16 percent).

Auto racing (which includes NASCAR) does best in the two lowest-income groups with incomes of $25,000 or less (each with 12 percent) and those who never went to college (11 percent). For more information visit www.harrisinteractive.com .

Bankers improving their service

Informa Research Services, Inc., Calabasas, Calif., has released findings from its Customer Service Index, a normative database reporting on banker sales and service performance. The following findings are the results of bank employee performance from over 7,000 mystery shops, from 20 institutions across the nation.

Audits of bank representatives’ sales and service performance show cross-selling, asking for the business, and offering help with future needs has improved sharply:

 Performance on softer issues related to customer relations has also improved:

At the same time, banker discovery skills (questioning) and product knowledge have declined:

“While bankers are placing more emphasis on improving the sales skills of branch employees, more focus should be placed on employee product knowledge and understanding customer needs,” says Paul Lubin, senior vice president, Informa Research Services. “Banks that ensure that employees discuss products based on customer needs are more likely to build long-term customer satisfaction and customer retention.” For more information visit www.informars.com .

Over half of RFID-aware consumers are concerned about invasion of privacy

In a study of over 8,000 consumers conducted by Artafact LLC, Fremont, Calif., and BIGresearch, Columbus, Ohio, 63 percent of consumers who are aware of RFID (radio frequency identification) reported feeling very or somewhat concerned about invasion of privacy issues. Those most sensitive to the issue are men (65 percent) and they tend to be older (35-54 years of age), better educated and higher-income than the general population.

Government tops the list of organizations most likely to abuse consumer privacy information, with 88 percent of those people concerned with privacy believing that the government is the biggest threat to using their information without explicit permission. The government is followed by “crooks and bad guys” according to consumers, as well as banks, insurance companies and credit card companies as additional threats.

Consumers express more concern with privacy issues today than ever before. And with many forms becoming electronic, they are cautious about divulging personal information and are taking active steps to protect themselves such as checking to make sure Web sites are secure before submitting information and shredding paper and unsolicited mail at home. Many believe their personal information is easily obtained by companies through magazine subscriptions and frequent-buyer programs implemented by grocery stores and airlines.

Although consumers recognize the perks of being rewarded for loyal shopping behavior, they are also concerned that their information is not protected and will be shared without their permission. “Almost everyone knows somebody lately who has had a bad experience with privacy invasion, credit card abuse or identify theft,” says Linda Stegeman, president of Artafact. “In online focus groups, they recount stories of friends or families who have been affected by institutions or crooks and bad guys getting access to their personal information.”

Only 35 percent of consumers concerned about protecting their personal information believe that RFID is a “good idea.” However, they also recognize the business benefits of easily tracking merchandise and preventing theft. Many consumers think they will not reap any benefit from RFID technology and are concerned with the potential for misuse, given the “lack of safeguards.” For more information visit www.bigresearch.com/rfid.htm .

Ladies like horse racing

Scarborough Sports Marketing, New York, released an analysis that finds that horse racing is attracting female consumers. Fifty-two percent of loyal horse racing fans are women (loyal horse racing fans are defined as consumers 18+ who are very or somewhat interested in horse racing). The only other sport out of the 23 measured by Scarborough where a higher percentage of loyal fans are female is the WNBA. Fifty-seven percent of loyal WNBA fans are women. Horse racing has experienced a growth in avidity among 18-24-year-olds. Nine percent of consumers 18-24 watched a horse racing event on broadcast or cable television during the past year, up from 5 percent in the 2002 study. This is an increase of more than 796,000 18-24-year-old horse racing viewers. Seven percent of consumers 18-24 in the most recent Scarborough study said they were loyal horse racing fans, versus 6 percent in the company’s 2002 study. “The Triple Crown races of the past three years have contributed to increased excitement in the sport of horse racing. As Scarborough data demonstrates, horse racing has undoubtedly found a new fan niche among women and younger consumers,” says Howard Goldberg, senior vice president, Scarborough Sports Marketing. “As the sport continues to flourish, marketers, gamers and other racing business partners may have new opportunities with these up-and-coming consumer segments.” Loyal horse racing fans lead active, diverse lifestyles. Scarborough Sports Marketing finds that these consumers are 21 percent more likely than all adults to have gone fishing during the past year, 27 percent more likely to have played golf, and 14 percent more likely to have gone power boating. Loyal horse racing fans are 17 percent more likely to have visited an art museum during the past year and 9 percent more likely to have attended live theatre. The data for this report was compiled from Scarborough Multi-Market 2004 (12 months). Data collection periods were February 2003 to March 2004. For more information visit www.scarborough.com .

Cellphones leave millions out of political polling process

As many as eight million U.S. households could be left out of the political polling process as a growing number of consumers move to cellular phones as their sole means of taking and making telephone calls, according to a survey conducted by the Consumer Electronics Association (CEA), Arlington, Va.

“Number portability, advanced text messaging and voicemail features, and most importantly, falling prices for service plans are all allowing more and more consumers to cut the cord to their traditional landline services,” says CEA President and CEO Gary Shapiro. “This trend is without question making it harder for political pollsters to get an accurate read on local, state and national races.”

The research, conducted online October 2 through October 5, 2004 among 568 likely voters, reveals cellular-only consumers receive far less polling solicitations than those with traditional landline service. In fact, only 10 percent of cell phone-only likely voters reported receiving at least one polling solicitation for a local, state or national election in the last 60 days. This compares to nearly 30 percent of consumers who also have, or rely exclusively on, traditional landline service.

The survey found a large portion of the cellular-only group (37 percent compared to 28 of all likely voters), don’t consider themselves Republicans or Democrats. Instead they’re more likely to be Independents or have no political affiliation at all. The cellular-only group is also much younger by nearly half compared to all other consumers, more likely to be single, employed part-time or not at all (mostly students) and have lower average incomes.

Another factor thwarting the effectiveness of political pollsters is the practice of call screening.

The survey found while likely voters, both Republican and Democrat, reported receiving an equal number of polling calls, Republicans are 25 percent more likely than Democrats to have responded to at least one poll. The difference was just as pronounced for polls related to the national election, where Republicans were more than 23 percent more likely to have responded to a poll call.

Some of the difference may be attributed to the survey findings showing that Democrats are much more likely than Republicans to indicate they screen their calls (44 percent and 27 percent respectively).

The survey also uncovered another factor working against pollsters. Democrats with cellular phone services who also have a traditional landline are 46 percent more likely (35 percent and 24 percent respectively) than Republicans to say they answer “most” of their incoming calls at home using their cell phones. For more information visit www.ce.org .