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Australian consumer ecommerce market lagging


Australian consumer ecommerce market lagging


Frost & Sullivan have identified the Australian consumer ecommerce market as being undeveloped and lagging both the US and UK markets by approximately three years.

The market is expected to reach $12 billion for the 2010 calendar year. This figure excludes online services such as online ticketing and events, travel, music downloads and financial services. It equates to per capita expenditure of approximately $536 per year, which is slightly behind the US and UK markets.

The report, Australian Ecommerce Market 2010, analysed consumer online purchasing of tangible products. It included the results of a survey of more than 1000 active online consumers in order to provide purchasing information relating to five product categories: electronics, computers, books and CD/DVDs, jewellery and fashion accessories and clothing and footwear.

A key reason suggested for the lag in local activity is the lack of online presence by many of the large retail chains and department stores. Online retail consumer spending in Australia is expected to account for approximately 5% of total retail sales, however if spending overseas is excluded this could drop to about 3%. Despite initiatives shown by stores including Big W, JB HiFi and Dick Smith, the small number of ecommerce participants and a lack of sufficient internal support from senior management continue to inhibit progress in this area, according to the report. Frost & Sullivan suggests that the Australian market needs to see the online launch of several retail chains within the next 12 to 24 months.

Further inhibitors to the development of a local ecommerce market included the strong physical store presence in the major cities, as well as Australian consumers’ limited acceptance of the typical online precursors such as mail order and catalogue sales. Security concerns were also mentioned, as one in 40 of the survey respondents indicated that their credit or debit card had been stolen in the last 12 months.

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