Who Is Buying Online?

It is time for another post with some economics of selling online statistics. Today’s question is “who is buying online?”

A recent PEW Internet and American Life survey shows that 75% of all U.S. adults in 2007 are using the Internet. Among users are 74% of adult women and 75% of adult men. The numbers are predictably up from the 2000 survey which showed that 46% of adult women and 51% of adult men were online. Usage has increased from 2000 to 2007 from 50% to 76% of white adults, 34% to 56% of black adults, and 43% to 79% of English-speaking Hispanics. As expected, internet access increases with age, income, and education.

The statistics on U.S. internet access suggest that there is a “digital divide”. While access has increased in all groups :

  • Young are more likely to be wired than old. (18-29 year old 92% to 65+ 37%)
  • Higher income more wired than lower income. (<$30,000 61% to $75,000 93%)
  • Highly educated more likely to be wired than less educated. (
  • White (76%) and Hispanic (79%) Americans are more likely to be wired than African-Americans (56%)
  • Suburban (77%) and urban (77%) Americans more wired than rural (64%) Americans
  • Full-time (58.6%) employees are more wired than part-time (12.5%) employees.
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    So what are Americans doing online? According to the study by PEW Internet and American Life, the more popular activities (reported by greater than 70% of users) include reading and sending email, searching for information on products or interests, getting directions or maps, and getting weather reports, news or travel information.

    Of particular interest to this course is that an estimated 78% of users research a product or service before buying it. 68% say that they buy products online. The demographics of those who buy products online are different than internet users in general. For example, of folks who make purchases online :

  • Buyers online are 74% White while only 10% Black and 10% Hispanic.
  • Buyers are more likely to be between 30-49 (46%) followed by 18-29 (26%) and 50-64 (23%).
  • Buyers tend to be more highly educated with 39% having at least some college and only 6% without high school diplomas.
  • Buyers seem to be fairly evenly distributed across income groups (however, a good percentage of buyers would not report that statistic).
  • Buyers are more likely to be from suburban (50%) areas rather than urban (25%) or rural (15%) areas.
  • 77% of online buyers have broadband access.
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    The study reports that the number of online users either buying or researching products online has roughly doubled since 2000.

    To catch up on some world internet statistics, see http://www.internetworldstats.com/stats.htm. World stats show that the largest number of Internet users come from Asia, followed by Europe. However, internet penetration (users/population) is highest (73.6%) in North America (including Canada and Mexico) and lowest (5.3%) in Africa.

    World statistics also show a digital divide. In nearly all the countries surveyed in an OECD study (pgs. 21-23), internet use decreases with the age of the user, increases with the education of the user, and increases with the income of the user. Globally, households with children are more likely to use the internet.

    Sources and More Information:
    http://www.pewinternet.org/trends/User_Demo_2.15.08.htm, Demographics of Internet Users, October-December 2007 Survey.
    MRI CyberStats, Fall 2007, http://www.infoplease.com/ipa/A0908398.html, Internet Access and Usage in the U.S., Fall 2007.
    http://www.pewinternet.org/pdfs/PIP_Online%20Shopping.pdf, pg. 8, Online Shopping, Pew Internet & American Life Project, February 13, 2008.
    http://www.infoplease.com/ipa/A0921862.html, Most Popular Internet Activities, Pew Internet & American Life Project tracking survey.
    http://www.oecd.org/dataoecd/44/56/40827598.pdf, OECD Study, The Future of the Internet Economy: A Statistical Profile, OECD Minitsterial Metting, Seoul, Korea, June 2008.

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