Competition in online buying

The rate of shopping that takes place on computers and other electronic devices continues to grow at double-digit rates each year. One of the reasons people shop at particular brick-and-mortar stores is convenience to their home or place of work. Since this isn’t a factor for online shopping, how are shoppers to decide which sites to use? NC State University economist Mike Walden answers.

“This is becoming more interesting as we see the number of online shopping sites increase. And, of course, as with anything you buy there are many factors to consider: membership fees, shipping costs, selection of sellers and return policies.

“Now to show you how this has become more complicated, one of the new online sites I recently looked at said that if you buy an item and you hold it until you buy more items, they are going to give you a great rate on your shipping costs. For example, let’s say I might want to buy a tie. Rather than having that tie delivered to me right now, I wait until maybe a couple months down the road when I might want to buy a shirt or a pair of trousers. And what this site says is, ‘Hey, you are going to get a great deal on your shipping costs if you do that!’

“So this is what I think we are going to increasingly see: … these online sites tweaking the process in order to attract more customers.”

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