What do high gasoline prices and e-commerce have in common? More than you might think.
Marin Software did an analysis of the correlation between energy prices and the number of paid-search clicks, and found that as oil prices rise, so do the number of clicks on paid online ads.
Unfortunately, the sample Marin looked at was small. It covered only five quarters, and the data sample was drawn from the Marin Global Search Index, which is made up of more than 800 clients who manage more than $2 billion in annualized ad spending.
Those clients represent about 5 percent of the market, according to Matt Lawson of Marin Software.
Still, the trend suggests that consumers really do shop more online when gas prices are high as a way of eliminating trips to the store.
Although there are other trends that are driving more consumers to shop online—convenience and increasing comfort with the technology, for example—there is a high correlation between the energy prices and paid clicks.
The coefficient of determination, also known as R-Squared, explains how well a statistical model fits the actual data. An R-squared value of 1 implies a perfect fit between the statistical model and the underlying data. In this case, the R-Squared value is 0.9669.
"The measured correlation is unusually high," Lawson said.
Separately, there are signs of increased online shopping in recent weeks as gas prices cross the $4 mark in some regions.
In April, e-commerce sales logged their highest single month of year-over-year growth since July 2007, jumping 19.2 percent from April 2010, according to Mastercard's SpendingPulse report.
"I think there is a loose connection," said Laura Gurski, partner and head of A.T. Kearney's retail practice. She added, she suspects this behavior is more prevalent in areas where consumers need to drive longer distances to reach stores.
On Thursday, the average national gasoline price rose for the 44th consecutive day, according to AAA, pushing the price to $3.985 a gallon.
Fortunately for consumers, crude oil prices have been trending lower, falling below the psychologically significant $100-mark Thursday. The lower price comes amid signs that demand for fuel in the U.S. is weakening, and a stronger dollar,which also is contributing to the drop.
Still, it is too soon to know whether this price move is a brief dip, or a new trend. Also, it will be a while before prices at the pump reflect this drop in crude oil prices.