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Hitwise
UK consumers changing online behaviour to cope with credit crunch
Monday, September 29, 2008
UK consumers are increasingly turning to the Internet to help them deal with the financial pressures and insecurities brought on by the global credit crunch. The latest research from Hitwise, an Experian company, highlights three key areas in which UK online behaviour has started to adapt. These include:

"This is the first real economic downturn to have occurred during the Internet age, and Hitwise data provides some fascinating insights into how people are reacting," commented Robin Goad, Research Director for Hitwise in the UK. "As you would expect, people are using the Internet to find cheaper goods and services, but also to find information on everything from the reasons behind the credit crunch to money saving DIY tips."

1. Consumers are searching for cheaper prices online

UK consumers are increasingly using price comparison and other discount websites to find the cheapest deals online. Following a 2 year decrease in traffic levels, UK Internet visits to retail price comparison sites increased by 20% between July 2007 and 2008. Similarly, searches for the summer sales have trebled this year compared with last, while consumers searching for discount vouchers have led to a 130% increase in traffic to specialist voucher websites.

2. Property searches have fallen, but traffic to House and Garden retailers has reached a new high

The credit crunch has hit online estate agents hard: in August 2007, websites in Hitwise's Business and Finance - Property category accounted for 0.85% of all UK Internet visits, but last month (August 2008) this figure fell to 0.55%. Falling demand for houses is mirrored by consumer search behaviour, with UK Internet searches for 'houses for sale' down 53.1% between August 2007 and August 2008.

At the same time, the share of UK Internet visits to websites in Hitwise's Shopping and Classifieds - House and Garden category increased from 0.49% in August 2007 to 0.59% in August 2008, overtaking the Business and Finance - Property category on the way.

Robin Goad, Director of Research at Hitwise, commented: "It looks as if people are choosing to cocoon themselves in their existing houses rather than move. The interesting thing about the growth in House and Garden retailers is that it applies both to DIY retailers, such as B&Q, Screwfix and Homebase, and furniture retailers such as Ikea and Laura Ashley. Both types of retailer have increased their share of Internet visits over the last 12 months."

One of the factors behind the success of House and Garden retailers online has been the increase in online DIY queries, as UK consumers look to improve their accommodation on a budget. UK Internet searches for the top 10 DIY-related 'how to' queries have increased by 25% over the last 12 months. In August 2008 the top DIY search was 'how to plaster', followed by 'how to lay decking' and 'how to wallpaper'.

3. Consumers are shunning ethical consumerism in favour of energy efficiency

UK Internet searches for ethical consumer products such as fair trade and organic have not increased over the last 12 months, but searches for energy efficiency terms, such as 'loft insulation', 'underfloor heating' have more than doubled over the last 12 months. Similarly, UK Internet traffic to the websites of gas and electricity providers has also doubled over the same period, as consumers hunt to find the best deal.

Theodore Koumelis - Monday, September 29, 2008
1 recommendation(s) , 95 print(s), 876 views, 0 comment(s)
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Poll
How do you expect luxury travel to perform in times of economic downturn?.

Providers of luxury travel products are going to witness shorter stays by their customers and an increase in seasonality.

People are going to become more value conscious and will opt for those luxury offers that represent a convincing value-for-money proposition. Providers of overpriced services are those to feel the pinch.

Both people paying for their personal trips and firms paying for their top executives' business trips will cut back on travel expenses, thus affecting all luxury travel providers.

It is going to be business as usual. Those people opting for high-end travel products are not going to be affected by the looming crisis.

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