Consumer Insights

Impulse Purchases Are On The Wane, But Will Retailers Care?

Consumers Ditch Impulse Buys

Of all the changes wrought in the retail world as it navigated from bricks and mortar to clicks and servers, somehow the impulse buy has managed to stick around. At first, it might have been just candy bars and packets of gum in checkout aisles, but now even big-ticket items can be purchased with very little friction and a great deal of digital convenience.

At least, that’s how things used to be. Now, the impulse buy might be going the way of so many other traditional elements of brick-and-mortar retail.

According to a recent study conducted by Monetate that monitored the purchasing behaviors of consumers over a 48-hour period, 42 percent of orders were placed within the first hour of visiting a retailer’s site. Over the following six hours, 9 percent of carts were closed out and 16 percent the following day. At the close of the two-day window, 5 percent of the total number of orders were completed.

While no single window produced more closed sales the first hour post-merchant contact, the fact that the majority of consumers decided to walk away from their computers or navigate to a different site for additional research doesn’t paint an encouraging picture for the impulse buy in the digital age. Lucinda Duncalfe, CEO of Monetate, explained that the profusion of devices shoppers can conduct said research on has also chipped away at the ubiquity of the impulse buy.

“Only 42 percent of purchases in the first quarter occurred within the first hour of a shopper’s browsing session,” Duncalfe said. “This is incredibly important for brands to understand. More than half of shoppers are spending a lot of time in a lot of different places on a lot of different devices before they come back and buy what originally caught their eye. It’s critical then that brands ensure a customer’s shopping experience picks up where it left off, no matter the time or device.”

The incredible choice available to the modern consumer has necessarily changed the way they go about convincing themselves of the rightness of a particular purchase, and the time it takes to track down a better deal — or simply confirm the first one was the best to begin with — is eroding the staying power of the impulse buy as a tool in retailers’ handy-dandy utility belts.

It’s enough to make some online merchants strapped for revenue nervous, unless impulse buys were what was causing those razor-thin margins in the first place.

During a conference call with analysts in January, Amazon’s CFO Brian Olsavsky tried to explain why his company’s shipping costs had risen 37 percent (even more than its 22-percent rise in revenue) to a new high of $1.8 billion.

Olsavsky’s answer? All those small, countless impulse orders it’s shipping at an increasing rate.

“This is all tied in with the increase in [Fulfillment by Amazon] growth and the demand from Prime members,” Olsavsky said during the call, via CNET. “We’re shipping more units — more of our units, so this ripples through our ship cost per unit.”

It’s part of the reason Amazon has taken to land, air, and (presumably in a pilot program) sea to establish a supply chain over which it can exert more institutional control than it can with its logistics partners. While a company the size of Amazon can never hurt from getting as many of its ducks in a row as corporately possible, the diminishing preference for impulse buys may be just as welcome a sight in Seattle boardrooms as a Prime member deciding to renew.



The PYMNTS Cross-Border Merchant Friction Index analyzes the key friction points experienced by consumers browsing, shopping and paying for purchases on international eCommerce sites. PYMNTS examined the checkout processes of 266 B2B and B2C eCommerce sites across 12 industries and operating from locations across Europe and the United States to provide a comprehensive overview of their checkout offerings.

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