Online Retailing in Australia 2010 Study

By Elisabeth Lambert | Thursday, 15 July 2010

Australian e-retailers looking for insight into the behaviours, trends and issues of the local industry will be pleased to learn that Forrester Research Inc has released the results of its benchmark study "Online Retailing in Australia 2010: Marketing, Merchandising, and Customer Service."

Making available for the first time real data on the domestic online retail industry, the study is also the first of its kind in Australia.

Steven Noble, Senior Analyst at Forrester and author of this study, says that Australian online retailers need to keep abreast of such studies and their findings so that they may better equip themselves to deal with the onslaught of competition that will target Australian online consumers over the next 12 months. "Australian online retailers need to understand that increased competition is coming from many quarters and when it comes, the online world will not be as straight forward as it has been to date."

While local e-retailers have done their best with limited time and resources, Steven says there's an acute awareness amongst the domestic trade that there's much more to action in order to capture and retain the online customers of Australia. "As the competition increases, Australian online retailers are going to have to be more precise, more focussed and not assume customers will keep coming their way."

The key results of the survey found that:

1. online retailers are gradually adding retention efforts to their mix,

2. search dominates marketing, but use of social tactics is on the rise,

3. retailers focus on boosting visual merchandising, and

4. retailers favour basic approaches to helping customers.

While the conclusions of the study show what Aussie e-retailers are doing well and which areas need to be quickly addressed, it also became clear to Steven that the Australian online retail industry is still in its infancy. This isn't necessarily a bad thing - for one, it gives Australian online retailers a rare opportunity to learn from their global competitors and not make the same (potentially expensive) mistakes overseas-based e-retailers have made.

It does mean however, that the time to grow the industry is now if Australian e-retailers are going to be a force and get their share of the Australian online shopping market. And one tool of the trade Australian online retailers need to embrace is analytics. "I was quite surprised by the immaturity of analytics used by online retailers in Australia," says Steven.

While Australian e-retailers are employing basic analytic systems to gain and compare information, Steven explains it's pertinent to ramp up the depth to which analytics are implemented in order to address customer loyalty, retention and value. "Only a small number of Australian online retailers are doing this," he says.

So Australian online retailers, if there is one thing left to ponder it is this. Increased competition is coming and it will be coming from a wide variety of different industries and sectors to steal the online consumers of Australia.