There’s no doubt that online shopping is a wave that is roiling the retail industry — and our culture, for that matter.

But it’s a wave that’s not sweeping up all shoppers in quite the same way.

According to new data, the rise of online shopping across the United States is rather uneven, with more affluent states marching more quickly toward a lifestyle in which buying happens on a screen instead of at the mall.

Adobe, whose software runs under many retail websites, analyses data on billions of website visits to create its Digital Price Index, a real-time snapshot of online consumer spending. Analysts there studied digital shopping patterns over a one-year period that ended in February 2017. Their measurements included state-by-state breakdowns of growth in total e-commerce spending, as well as online spending per person.

The Adobe research revealed substantial choppiness in year-over-year growth rates in total spending. For example, states near the coasts such as New Hampshire, Oregon, Rhode Island, New Jersey and California saw some of the strongest surges in online shopping. (Big pickups weren’t limited to the eastern and western seaboards; Texas and Mississippi also posted robust e-commerce growth.)

Maryland saw an eight per cent increase in spending, and Virginia saw a seven per cent uptick.

Meanwhile, online spending retreated or held steady in a handful of states, including Idaho and South Dakota.

But things get especially interesting when per-person online spending is plotted against the most recent Census Bureau figures for state-level median income.

A noticeable correlation in the data suggests that affluent consumers are adapting to online shopping especially quickly. Luiz Maykot, a data analyst at Adobe Digital Insights, said that a number of factors could be shaping the difference, including that low-income shoppers are less likely to have credit cards, which are table stakes to participating in online shopping.

The data illuminate other interesting lessons, too. For example, Alaska and Hawaii are affluent states that don’t fit the pattern of having strong per-person online spending. Maykot said such a result probably reflects the fact that shipping to those states can be pricey and relatively slow — factors that make online shopping less attractive.

The research also offers hints that perhaps relative affluence is not the only factor that informs people’s disparate adoption of online shopping.

For an example here, turn to Washington, DC. It’s a city, and its growth and spending look much different from any of the 50 states’ figures.

The District’s per-person online spending grew 38pc over the one-year period. The next-largest growth rate, recorded in New Hampshire, was just 20pc. Furthermore, consumers in the District spent a whopping $3,353 per person online. That is dramatically higher than the per-person figure in any state. (New Jersey was the highest, at $1,736.)

So perhaps the gap suggests that urbanites, in general, have migrated to online shopping much faster than their counterparts in less densely populated areas.

Maykot said that while he can’t say for sure, as Adobe doesn’t yet perform city-level analyses, this is a ‘credible hypothesis’ for why the District is an outlier.

After all, there are unique pain points to brick-and-mortar shopping in cities: Checkout lines at high-traffic stores can be excruciatingly long. Nabbing an on-street parking spot can feel like a miracle. Many city residents don’t own a car, and it can be hard to lug purchases on public transit or on foot. All these factors may be pushing city dwellers to adopt online shopping more quickly than people in smaller towns.

Taken together, the data help provide valuable context for how to think about the business strategies of some of the biggest names in retail. For example, Amazon.com’s same-day delivery service is largely concentrated in affluent cities. Sure, that’s in part because the economics are better when customers are clustered close together.

Similarly, people sometimes ask how Walmart could possibly sustain its more than 4,000 US stores in the digital era. This research helps explain that: That tower of Amazon boxes outside a big-city condo building each evening may not be a good proxy for how people are shopping in, say, rural Tennessee. Even if some people are doing less of it these days, there is still enormous appetite for shopping in brick-and-mortar stores.

— The Washington Post Service

Published in Dawn, Business & Finance weekly, March 27th, 2017

Opinion

Editorial

Smog hazard
Updated 05 Nov, 2024

Smog hazard

The catastrophe unfolding in Lahore is a product of authorities’ repeated failure to recognise environmental impact of rapid urbanisation.
Monetary policy
05 Nov, 2024

Monetary policy

IN an aggressive move, the State Bank on Monday reduced its key policy rate by a hefty 250bps to 15pc. This is the...
Cultural power
05 Nov, 2024

Cultural power

AS vital modes of communication, art and culture have the power to overcome social and international barriers....
Disregarding CCI
Updated 04 Nov, 2024

Disregarding CCI

The failure to regularly convene CCI meetings means that the process of democratic decision-making is falling apart.
Defeating TB
04 Nov, 2024

Defeating TB

CONSIDERING the fact that Pakistan has the fifth highest burden of tuberculosis in the world as per the World Health...
Ceasefire charade
Updated 04 Nov, 2024

Ceasefire charade

The US talks of peace, while simultaneously arming and funding their Israeli allies, are doomed to fail, and are little more than a charade.