Online retail sales in Australia grew by 11.5% in 2016 as Australian consumers are shopping online more than ever and mainly from local shops while retailers and carriers are responding with more convenient return and delivery options, new research by Australia Post revealed.
According to Australia Post’s second annual Inside Australian Online Shopping Report, which is based on the customer and delivery data of the postal operator and its express parcels subsidiary StarTrack, domestic retailers made up 79% of the total online spend in the country.
Australia Post's General Manager of eCommerce & International, Ben Franzi, said that Australians “love of fashion and department/variety store items continued”, with the two categories accounting for more than half of all online sales.
Other popular items purchased online included personalised goods with an increase of 28.2%. Franzi explained that more online retailers were offering shoppers the possibility to co-design and add their own personal touch to products such as watches, handbags and other accessories.
He named price, range and convenience as the three main reasons why consumers shop online and why the growth rates remain high.
In particular, many online shoppers take advantage of being able to shop online at the most suitable time for them. "Almost one third of all online purchases were made from 7-10pm, while 18% were made from 2-5pm. Australians are increasingly using their smart phones to shop online, with purchases made from a mobile device growing 52%,” Franzi said.
Together, Australia Post and StarTrack deliver more than four billion items to 11.6 million addresses across the country annually. Franzi said the data from the report provided critical information for businesses looking to get ahead in a tough retail market. "Here in Australia we know the online shopping industry is about to be disrupted, and retail as we know it won't ever look the same.”
According to a separate Australia Post Consumer Survey 2016, parcel volumes generated through online transactions increased by an average of 16% per shopper over the past 12 months. “It’s likely that a major driver of this acceleration has been the increased sophistication of online retailers. Businesses are creating strong brand loyalty and product familiarity, while providing better services, improved online experiences, and more convenient return and delivery options,” Australia Post stated in the survey.
Growth in online spending outperformed bricks-and-mortar retail by 6.9% points last year. the survey further revealed.
However, traditional retail still remains a “huge industry” in Australia with AUS $261 billion generated in 2016, compared to $18 billion in physical goods generated through e-commerce.
As for barriers to online shopping, Australia Post’s research in 2016 revealed that many of the issues once considered barriers to online shopping are becoming less significant. Returns of goods was cited as the main barrier. Now, retailers are responding with well-defined return options, giving customers more confidence when shopping online.
Some consumers also cite delivery as a problem since it can be difficult to arrange a convenient delivery time. “Carriers and retailers are responding by providing alternate delivery options, including in-store and other collection points,” Australia Post concluded.
