Online Retailer

Australian Retail Barbeque – Bricks Burn, While Online Sizzles

As the industry is in uproar over the finding from the Productivity Commission, some seasoned industry experts offer some timely advice for ailing retailers.

At the barbecue of retail business, bricks and mortar are the smouldering ashes while online retail flames leap through the grill – despite global economic turmoil’s best efforts to extinguish the fire.

With the Productivity Commission delivering a slap in the face to retailers desperate for relief, by citing that lowering of the GST threshold would have little to no impact on the productivity of the industry and that offshore online sales were likely to remain ‘attractive’ to consumers in spite of the depreciating dollar* – the industry response has been varied.

The National Retailers Association (that represent large Australian retail chains), have launched a scathing attack on Australia Post, Visa and eBay, accusing the companies of not supporting the industry in their recent submissions to the Productivity Commission.

However advice from industry experts speaking at the upcoming Online Retailer Conference and E-Commerce Expo suggest that retailers should be taking back control of their business and turning their attention elsewhere… namely to the customer!

“Australian consumers want to shop online, there is no doubt about it – and the fact is they can, anywhere, anytime,” says Grant Arnott, Conference Chair for the Online Retailer Conference and E-Commerce Expo.

“Too many bricks and mortar retailers are clinging to traditional models that presume shoppers want to make a time-consuming trip to a store, battle for scarce parking, beg for service, stand in a checkout queue and then lug shopping bags back out to the car.”

Paul Greenberg, Executive Chairman for DealsDirect.com.au concurs. “Consumer frustration with local retailers is not about 10 percent. It is, unfortunately a far bigger issue. Our customers continue to tell us they prefer to shop locally for a number of reasons, but of course the experience, range and variety needs to be a good one. If not, well, the global village is upon us, and they will shop where they can get a great experience.”

Though plagued with reports about the demise of the local retail industry and foreign invaders robbing market share, all of this doom and gloom is overshadowed by the state of the $36 billion Australian online retail industry, which is booming!

With Forrester Research indicating that Australian consumers spent $606 million just purchasing books online in 2010** – the question is, why are retailers so reluctant to embrace this channel?

“Too many retailers are ‘waiting’ for government intervention on the GST issue. And perhaps it might come, but in the interim, my advice to retailers is to focus on improving the customer experience. Period,” advises Greenberg.

“Price is not the be all in the consumers mind. Australian retailers need to show the value in buying locally which includes faster shipping, local returns processes and in most cases product which is shipped to Australia for the Australian market,” adds Peter Krideras, Head of eCommerce, Bing Lee.

Whatever the case may be Australian retailers are in a position to take control of their businesses and with the low-cost barriers to entry, boundless opportunities for geographic expansion, personal and social connectivity to customer bases – online retailing presents a golden opportunity to do just that.

“We need to lift our game to compete with the best of the world in online retail. Over the next three years the roll-out of faster internet speeds, and new technologies (such as mobile and tablet applications) are likely to enable a new type of consumer – one who expects to get what they want, where they want it,” warns Paul Robinson, Marketing and Communications Manager, for 2010 ORIA Online Retailer of the Year, ABC Shop.

“This will see online retailers (who are leading innovation and providing the tools for the new consumer) moving to take the place of traditional retailers who are unable to keep up with the rate of change. This has already happened.”

Arnott, a stalwart of the Australian online retail industry and responsible for compiling the newly released agenda for Australia’s largest e-commerce learning event, the Online Retailer Conference and E-Commerce Expo, concludes, “Retailers need to embrace and promote the ‘omnichannel’ shopping experience – giving customers back the choice to buy online, via mobile, in-store, or through social media marketplaces, otherwise they will lose interest.”

The Online Retailer Conference and E-Commerce Expo is the only event in Australia that gives retailers the opportunity to learn from some of the worlds leading e-commerce experts and retailers, investigate the best solutions and latest technologies for their businesses and grow their network of peers for sharing of knowledge and skills.

The full conference agenda is now available at: http://www.onlineretailer.net/or/conference/main-conference

Event details:

Name: Online Retailer Expo and Conference 2011
Dates: Monday, 26 September to Thursday, 29 September, 2011
Venue: Sydney Convention and Exhibition Centre, Darling Harbour, Sydney
Official website: www.onlineretailer.net

*Australian Government Productivity Commission, Economic Structure and Performance of the Australian Retail Industry, Draft report, 4th August 2011.
**Deloitte Access Economics, ‘The Connected Continent – How the internet is transforming the Australian economy’, August 2011

Nirosha Methananda

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Nirosha is a content creator for The Media Pad, publisher of Power Retail. Coming from a marketing and communications background (in the legal, retail and online industries), Nirosha is excited to be able to put her knowledge and experience to work for Power Retail. Recently engaged, Nirosha is immersing herself in the joys of wedding planning! She is also an avid reader (of mostly fiction), always keen to get onto the golf course, likes to paint, tries to sing and is able to recall useless celebrity facts at the drop of a hat!

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