Retailers need to optimise mental and physical availability to succeed in fragmented market
Tuesday 13 August 2024: Online shopping has firmly established its place in the ANZ retail landscape, with 83% of Australian online shoppers and 77% of NZ online shoppers shopping online every month. The data, which comes from the Australian and New Zealand Ecommerce Report 2024 was released today by IAB Australia and Pureprofile, also found that value seeking is top of mind, with an increase in the number of shoppers prioritising lower prices and discounts and 62% switching products and brands to find cheaper alternatives.
According to the report, consumers are using an increasing range of price and product discovery options to find the best value and range of offerings. While search engines remain the most used method, 38% are using price comparison sites and services, and 20% using major shopping events to look for discounts as well as for product discovery. 58% of shoppers aged 18-29 note that influencers and social media impact their research and shopping habits.
Convenience remains the number one reason for purchasing online (68%), with time poor 18-49s prepared to pay more for convenience. However, shopper loyalty and rewards programs were identified as being increasingly important with 92% of online shoppers enrolled in at least one such program and 95% of online shoppers willing to share some data with retailers in return for benefits such as discounts, coupons, free delivery, rewards points and cash back.
More than 80% of online shoppers understand that their data is used for targeting advertising, marketing and personalisation, however, 71% of online shoppers are increasingly concerned with how retailers use their shopper data (up from 59% in 2023).
Gai Le Roy, CEO of IAB Australia commented, “The increased importance of loyalty programs for shoppers and retailers is underpinned by trust, transparency and a clearly understood value exchange. It is critical that retail businesses ensure they are providing clear information about their use of shopper’s personal information, particularly with new privacy regulations in Australia imminent.”
Martin Filz, CEO of Pureprofile commented, “In a quest for savings, consumers are prioritising the best deals and frequently switching brands to secure better price. While budgets are tighter, retailers still have a great opportunity to capture attention with most consumers still engaging with some form of retailer marketing.”
Key learnings for retailers
- Clothing, fashion & shoes (70%), groceries (58%), and meals & takeaway (56%) were the top three products purchased online.
- Retailers are also a key source of product discovery. 61% of online shoppers have read or looked at content produced and distributed by retailers (such as websites and apps, emails and social posts). It is important for retailers and brands to show up in these various avenues for inspiration and discovery. Continuing investment in advertising across multiple channels, particularly for brand building, is the proven key to long term business success and coming out of an economic downturn strongly.
- Search is particularly key for product discovery for over 50’s online shoppers (71%) while social media plays a greater role for 18-29’s (58%) and 30-39’s (46%).
- Price comparison, fast shipping and free returns were all identified as increasing in importance to online shoppers this year.
- Purchasing from ethical brands is important according to 46% of Australian and 39% of New Zealand online shoppers
- The Report notes that retailers need to use discounting strategically as part of a broader marketing strategy that also offers added value and relevant shopping experiences that are suited to the current economic climate, and which offer truly life enhancing convenience.
The Australian and New Zealand Ecommerce Report 2024 is based on research conducted with 1,000 Australian and 1,000 New Zealand online shoppers during July 2024. It examines the consumer attitudes, behaviours and influences driving ecommerce. This is the fourth annual Ecommerce Report for the Australian market and the first year a survey amongst New Zealand online shoppers has been conducted.
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