Australian businesses not prepared for the arrival of Amazon – PayPal research

Australian businesses are failing to meet consumers’ shipping expectations, according to a PayPal report, and the impending arrival of Amazon and Alibaba will only increase an already competitive market.

PayPal’s ‘mCommerce Index’ trends report reveals Australian businesses are failing to meet consumers’ shipping expectations.

In other markets worldwide, free and fast shipping is no longer just a value add, but a consumer expecation.

Key findings in the report include:

  • 42% of Australian smartphone users say that Australian businesses are behind when it comes to shipping,
  • 57% are deterred from shopping at a store again if shipping takes too long,
  • 63% would ‘definitely buy’ with next day delivery, and
  • only a third of Australian online businesses offer next day delivery.

 

The report shows that lengthy Australian shipping times undermine the benefits of mobile shopping.

“With two online shopping giants, Alibaba and Amazon, poised to enter the Australian market, local consumers will have greater choice and online retail will be more competitive,” says Libby Roy, PayPal Australia managing director.

“To compete effectively, Australian businesses need to think beyond ‘units sold’ and understand their customers’ full engagement lifecycle including shipping, returns and other value-added benefits,” she continued.

Shipping is revealed to be a key factor in shopping cart abandonment, with 73% of shoppers saying they’ve abandoned a purchase due to shipping costs being too high and 42% have abandoned a purchase because shipping took too long.

“Australia has one of the highest levels of mobile penetration globally and 71% of Australian smartphone users shop on their mobile devices, yet it seems shipping experience is making the convenience of mobile shopping redundant,” says Roy.

Nearly one-third of respondents ranked groceries and food and drink as the two most important categories for next-day delivery. Tickets to music concerts, movies, arts events, clothing and accessories tied for third place, both prioritised by 9% of respondents.

Sporting goods and toys and games ranked as least important for next-day delivery.

 

Further reading

 
Image copyright: anekoho / 123RF Stock Photo

Ben Ice
BY Ben Ice ON 17 May 2017