The Impacts of Amazon on Consumer Behaviour

By Hannah Ainsworth | 25 Jul 2018

In 2017, the impending arrival of Amazon sent the Australian retail world into a spin! But, a year on, how has its arrival really impacted Australian consumers?

When Amazon announced its plan to enter the Australian retail market, retailers predicted that customers would spend less money with them, and more with Amazon. A high level of disruption to retail was forecast with two out of three customers stating that they expected to start shopping with Amazon instead of their usual retailers.

A recent White Paper report launched by Retail Doctor Group (RDG), outlined research into the actual impacts of Amazon on the Australian marketplace. Between August 2017 and April 2018, RDG conducted two studies that surveyed over 1000 Australian consumers, pre and post the Amazon launch. Whilst some of the results of the research is as expected, there are some surprises.

Of the consumers who were surveyed in August 2017, 30 percent stated that they had not shopped and would not shop at Amazon.com. In April 2018, following its coveted release, this increased considerably to 70 percent. Whilst the knowledge of Amazon has increased since August 2017 from 62 percent to 79 percent, the drop in Australian retail hasn’t occurred as expected.

In good news for retailers, Amazon’s image took a plunge during this time. Prior to Amazon’s release, 45 percent of people surveyed perceived that buying from Amazon was value for money; this has since decreased to 35 percent. The other two considerable drops in perception from consumers centred around the both the quality of products available on Amazon and the reliability of the service. Overall, a customer’s overall perception of Amazon was in decline.

 

 

Whilst Amazon’s global presence means it is becoming a household name, the trust in the company from the Australian public is still in doubt. Thirty-eight percent of consumers surveyed attributed this lack of trust to its newness to the Australian market. Amazon may not be kicking every goal in the Australian market, but they’re hardly struggling as sales in books, electronics, clothing, and accessories have increased.

The best news of all though is that Australian retailers have seen less of an impact on sales than what was predicted. Eighty-five percent of retailers surveyed stated that the arrival of Amazon has had no impact on their business.

As a result of the loyalty of Australian consumers, the retail industry continues to hum along, mostly unscathed by behemoth retailers such as Amazon.  Australian consumers continue to have faith in Australian retail, and it appears, will continue to support the brands they love.

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