There are plenty of reasons to do your shopping online instead of in stores: Maybe you find a deeper selection of merchandise on digital shelves. Or maybe you just prefer shopping from the comfort of your couch.
Researchers at Anthem Marketing Solutions compared prices online and in-store on a wide assortment of typical household products. They controlled for brand and package size, and only assessed items that were available in at least three brick-and-mortar stores and at three online outlets.
In 75 percent of their observations, they found no difference in price online or in stores for a given item. Stephanie McAndrew, senior project manager at Anthem, said that since the team began conducting this semi-annual study back in 2010, it has consistently seen a move toward more uniformity between online and in-store prices.
This finding seems plausible given the shopping patterns that we see in today’s marketplace. The majority of consumers don’t stick to just one channel or the other; they alternate between online and in-store shopping. And so retailers are likely realizing that customers will be quick to catch on to different prices — and might be turned off if they see them.
The increased consistency seen on pricing may also reflect a move by many stores to develop a more holistic view of their inventory. In the past, many retailers had separate silos for items to be sold online and items to be sold in stores. As retailers move to a single inventory pool, it’s likely easier for them to maintain uniformity on prices.
The researchers found that price consistency was the highest in the household products category, which includes items such as detergent, garbage bags and air fresheners. With prices being the same 80.8 percent of the time, this is the category in which there is perhaps the least incentive to do cross-channel price-checks. Meanwhile, the beauty category had the lowest price consistency, 62. 1 percent. So it might be helpful to do some research before you pick up a new lipstick or nail polish.
Still, in the quarter of cases when price disparities do exist, you might be wondering: Are the deals better online or in stores? The answer, it turns out, is somewhat complex. Overall, researchers found that, when there was a price difference, online prices were better in 75 percent of the cases they observed. But the depth of the deals to be had online varied widely by category, as you can see in the chart below:
As the chart clearly shows, there’s potential for deep savings on entertainment items such as DVDs, video games and board games. And the chasm is growing fast: In Anthem’s previous study, there was a 43 percent average savings online in entertainment category, compared to nearly 74 percent this year.
At the other end of the spectrum is groceries, the only area where there is actually more of an opportunity for savings in store than online. Grocery is a retailing category that so far has been among the least disrupted by the boom in online shopping, and perhaps this price difference is in part to blame for keeping shoppers from giving online grocery shopping a try.
Finally, Anthem also parsed the data to look at whether there were different savings patterns for small-ticket and big-ticket goods. It broke items into five categories: Under $5, $6 to $20, $21 to $60, $61 to $80, and over $100. There wasn’t a major amount of variation in the findings, with each price tier seeing that prices were consistent across in-store and online in at least 72 percent of observations. In instances where there was price variation, the cheaper price was online at all price points.
McAndrew said this finding marks a distinct change from earlier editions of the research.
“When we started these reports, when there was a price difference, if it was under $50, you were more likely to find it cheaper in store,” McAndrew said. “Then, two years later, [it was] $20.”
And now, even on tiny items such as Chapstick, McAndrew said the in-store advantage is slipping away.
Overall, Anthem’s findings suggest that value-conscious shoppers probably don’t need to agonize over whether they might have gotten a better deal by shopping in a different channel. In the clear majority of cases, the prices are the same, and there’s reason to believe that prices will only get even more closely matched over time.
That said, if you’re an especially obsessive deal hunter, it might be beneficial to take more of your shopping online since, in most categories, this was where researchers observed the most opportunities for savings. But, as you weigh your options, keep in mind that Anthem’s price comparisons did not factor in shipping costs for online purchases. So, particularly on a small-ticket item for which a retailer might not offer free shipping, the presence of those charges could end up offsetting the savings — or erasing them altogether.
