This article appeared in the February 1985 issue of Online Today, CompuServe's magazine for CIS subscribers.
Results of an A.C. Nielsen Co. study show that The Electronic Mall, provided by CompuServe and L.M. Berry, has better response rates — with lower costs — than traditional direct marketing methods.
During a four-month test of The Electronic Mall, Nielsen found that an average of 2.1 percent of visits to mall merchants resulted in a sale. The average direct mail and catalog response rate is 1.5 percent. The national test was conducted on CompuServe between April and July 1984.
“The Electronic Mall offers merchants a new means of reaching a targeted market of young, upper-income, technologically-sophisticated consumers who have demonstrated a preference for electronic transactions,” says Mike Pardee, project director of Nielsen. “Some of the mall’s merchants had a response rate as high as 13 percent,” Pardee says. Respondents gave the mall favorable ratings on convenience, the selection of goods, services and merchants, the prices of merchandise and ease of use.
Highlights of the Nielsen findings include:
• Subscribers reported spending an average of 10.6 hours of their discretionary time each week using their microcomputers, followed by 6.6 hours watching television, 4.3 hours reading magazines and 3.5 hours reading newspapers.
• The average CompuServe Consumer Information Service household has 3.1 people with a median household income of $44,000.
• Subscribers visited the mall and its merchants 537,000 times, or about 31,000 times per month. Nearly one-fourth of the 150,000 subscribers in the study sample made three or more visits to the mall.
• Ninety-two percent of the purchasers were satisfied with the products they received through The Electronic Mall.
• Eighty-three percent of all mall users said they “liked it” or “liked it very much.”
• The average purchase was $45.
The market for online services, such as The Electronic Mall, is expected to grow as more consumers purchase personal computers with modems. Of the 6 million homes with a micro, 1.5 million are also equipped with modems. Sales of modems are expected to grow by 40 percent each year through 1988, according to Future Computing, a Dallas-based market research firm.
“The data suggest that new subscribers are younger, female and even more receptive to the idea of electronic shopping than long-time CompuServe subscribers. As the number of this new type of subscriber grows with the increasing penetration of computers and modems in the home, the demand for products such as The Electronic Mall will also grow,” says Pardee.
Plans call for The Electronic Mall, owned by CompuServe, to expand to other videotex services, to reach a combined subscribership of 250,000 households.
— Douglas Branstetter