Customers the winners as big guns boost online shopping
THEY took a while to get going but major retailers are now giving the big online players a run for their money.
RETAIL giants have been muscling in on Australia’s online shopping market and the biggest winners are consumers.
After a slow start to online shopping, traditional retailers such as Woolworths and Harvey Norman have embraced the digital world and the innovations for customers are flowing freely, analysts say.
Telsyte senior analyst Steven Noble said major retailers had poor online offerings a few years ago but had “moved forward incredibly rapidly”.
“The Australian high street has picked up their game,” he said.
Last year Australians spent $28.4 billon buying goods and subscriptions online, a 12 per cent increase year-on-year, according to Telsyte research.
The pace has picked up early this year, with global payments platform eWAY last week reporting a 22 per cent just in transactions for the first quarter of 2015.
“The pie is growing rapidly for all players,” Mr Noble said.
“It’s not just about the web anymore — the wave of innovation has seen shopping push into phones, it will push into watches and is also changing how we shop in stores.
“Everything that we do when we are shopping will be changed by technology in ways that are hard to imagine.” For example, future watches might alert you when you walk past an item on your shopping list, Mr Noble said.
Industry experts say our most successful online retailers are still largely the “pure play” businesses such as daily deals site catchoftheday.com.au, clothing brand SurfStitch and footwear business Shoes of Prey.
Dr Sean Sands, from Monash University’s Australian Centre for Retail Studies, said retailers had become more serious about online, which resulted in better customer service.
“Retailers are finding new and innovative ways to service consumer demand by offering home delivery, Saturday delivery, pick-up and parcel box delivery options,” he said.
“Customisation has been a major trend in online shopping, offering customers the ability to tailor and customise products and services.”
Dr Sands said the next big opportunity for Australia’s online retailers was to sell more to offshore markets, which would be helped by the weaker Aussie dollar.
It reverses the trend of recent years where our high dollar prompted local online shoppers to buy from overseas. Last week’s eWAY report suggests the change is already under way.
“With the Australian dollar down substantially on this time last year, the dollar value of physical purchases sent to international postcodes is up almost 30 per cent,” said eWay founder and chief executive Matt Bullock.
“There is a clear window of opportunity for small businesses to open up their offering to global markets, if they are not already,” he said.
SOME SHINING STARS OF ONLINE SHOPPING
Woolworths: Apart from its supermarkets it has built strong online presence for its Dan Murphy’s drinks business.
Appliances Online: The specialist retailer of whitegoods and other appliances was formed out of a century-old family appliance company a decade ago.
SurfStitch: Shares in the ASX-listed clothing and footwear retailer swelled last week after it said profits this year would be well ahead of forecast. Not bad for a business started seven years ago in a small garage.
Shoes of Prey: You can design your own shoes on this site, which has also branched out into bricks and mortar retailing.
Temple & Webster: A subscription-based retailer that sells homewares, furniture, gifts and art.
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