The Evolution of Online Shopping

One of the most fascinating things about the internet for me has been the changes that have occurred in the way we shop online. It used to be that we used the internet to research products before we bought them, and only the most brave actually used it to purchase items. As time went on, e-commerce became more sophisticated and we as consumers grew in our online shopping repertoire.

According to the Pew Internet and American Life Survey released in February 2008, 93% of Americans have at one point participated in e-commerce. Now 20% of us use the internet every day to research a product we're interested in buying. With the way the e-marketplace has grown, I'm almost surprised this number isn't higher, as we have so many ways to participate:

Ebay showed us a way to both buy and sell items in the familiar format of auctions.
PayPal calmed our fears about the safety of online shopping.
Amazon suggests content based on our preferences and the buying behaviors of others who have purchased similar items.
Pandora and the iTunes Genius Bar suggests new music (that we buy online or IRL)
Etsy created a mom-and-pop marketplace for independent artists
PriceGrabber.com and other sites allowed us to comparison shop just like we would in real life, but saving us the time, travel, and energy.

I think it is interesting to note that many of these changes reflect the way we shop in real life. We understood the concept of auctions and were able to integrate that knowledge into our online purchasing behaviors. We follow WOM to find the best products in the categories we're interested in. We trust the suggestions of our friends, family, colleagues, and other peers who share our same interests. More and more, we're seeing online shopping reflecting exactly the way we shop in real life.

An interesting iteration of this trend is the Epsonality website, created by Butler Shine Stern and Partners. It takes the real life experience of shopping in a store with the help of a sales clerk and translates it to an online experience. When you first come to the site, you are greeted by a charming voice who instructs you to select your various printing needs (price, job type, necessary extra features, etc). Once you've done that, it calculates which printer is best for your needs. It then introduces you to your printer and points out some of its special features (each of which are illustrated in a light-hearted, charming way). When you "Meet your Epsonality" it spews back to you what it's got and why it fits your needs. At this point you can either find a retailer or buy it on the spot. You can then download widgets to "inspire your epsonality."

While I love that it walks you through the process and helps with the ever-daunting task of shopping for tech hardware, I know myself and many others don't necessarily do their online shopping at home. We're taking the internet everywhere we go, and suddenly having a voice pop out of your work computer, iPhone, or laptop at the coffee shop isn't necessarily preferable. It'd be an easy fix to just do a title page that tells you to plug your headphones in or let you know sound is coming. A recent ISACA survey called "Shopping on the Job: Online Holiday Shopping and Workplace Internet Safety" noted that 63% of Americans intended to shop online at work this holiday season, while only 55% of companies allowed such behaviors (from an IT standpoint--productivity is obviously a whole 'nother issue). And truthfully, I  imagine that the number of folks using their time at work to do a bit of research is significantly higher than those who intended to make those purchases as found by the survey.

So while I love that the Epsonality website took online shopping to the next level of real-life reflection, it may have been a bit off-mark when it comes to where we're doing our shopping and what that means for the desired user experience.

Sponsored Video Streaming: How the Music Industry is Coping

In the last post in this series, I made mention of Napster and the parallel issues the music industry has faced. They've had the benefit (?) of beginning these battles much earlier, with Metallica making noise in 2000, and thus have already gone through many growing pains to reach some degree of maturity. I recall a time when even though I knew it was wrong, there was no way I was going to pay when I could get it for free...and yet here I am, with nearly $100 in  purchased songs and episodes in my iTunes library. 

The industry as a whole has found a number of ways to cope. First, strong partnerships with online music stores like iTunes gave consumers the opportunity to get their music the same way they've become accustomed to while still supporting the artists and labels financially. Second, they focused on the sales opportunities of merchandise and concert tickets instead of relying on disc sales. And third, and definitely most difficult, they changed their mindset. The industry listened to what their consumers wanted and they made it work for both of them, looking for how it could work to their advantage:

Myspace became a place to support artists and get the word out, while informing fans and soon-to-be-fans about upcoming shows and giving them the chance to purchase merchandise instantly. Download sites offered bonus songs for free when consumers signed up. Sites popped up like Daytrotter to let you hear live performances from artists to get hooked, then drive you to buy the full CDs. Pandora streamed free music, purchased from the label, and suggested to consumers who in turn can go buy the tracks. And the industry keeps moving forward, using apps and other new technology to continue giving consumers what they want without compromising sales.

So now the question is, how can the video entertainment industry learn from these lessons? They've already begun with providing episodes for sale on iTunes, investing in video technology on mp3 players, and supporting themselves with ad revenue, but what new revenue streams can they find? 

RELATED UPDATE- I felt like watching some TV this afternoon but there was absolutely nothing worth watching, so when I found that TRL was on, I decided to go with the throwback--I was in middle school when it first came out. I switched over and discovered that today's show is the second to last episode EVER. Besides the fact that TRL has totally changed over the years, do you think being able to find the videos online are part of why the show has lost traction?

UPDATE 2.0: Just found this post by Ed Cotton--great thoughts on some of the same stuff. Love the quote from Techcrunch about the music itself being the marketing.