Online Shopping: Price Tops Convenience?

Evidence now suggests that online shoppers are more concerned about price than about new features or convenience - the advantage which e-tailers once thought would allow them to charge more than offline stores, reports the London Financial Times. Amazon.com, one of the few global names in online retailing, has made this discovery. Founder Jeff Bezos has committed the group to an "everyday low pricing" model that would not look out of place at Wal-Mart. He has also begun to tackle customers' aversion to shipping charges by waiving these on orders above $99.

Price pressures have been driven in part by the growth of established U.S. discounters such as Wal-Mart and Target Online. Stephen DiMarco of Compete, a Boston-based advisory company, notes that the growth in discounters' traffic was higher than at other online stores before Christmas. Comparison shopping is also becoming an entrenched trend. "More customers are looking at one product on two sites, then opting to buy on the cheaper site," DiMarco says.

Moderator Comment: Are online consumers now more concerned with price than convenience?

It stands to reason as more of the population migrates online that pricing would become more important. Early consumer adopters of the technology tended to be more educated and affluent. The general population, dealing with a flat economy and uncertain employment prospects, make not see higher prices as a fair trade for the convenience delivered. [George Anderson - Moderator]

• Online Shoppers Choose Price over Convenience - Financial Times