Online Web Retail Sales Up 90%, Bricks and Mortar Retail Crumbling

Against the backdrop of dismal news for bricks & mortar retailers it has been reassuring as an ecommerce website developer to read through the findings of the Commonwealth Bank's Global Markets Research report into the state online retail and e-commerce in Australia. 

The report shows that consumers have flocked online in ever increasing numbers in the past 12 months. Best yet is the fact that online retail is still growing and there is massive opportunity for further growth. Australia still lags behind the US and UK when it comes to online sales but seemingly the only direction is up.

The report’s findings are particularly interesting in what they reveal in the deeper analysis of consumers buying patterns online.

From my perspective, the 10 most interesting findings: 

1. Online retail sales are up a staggering 90% this year in value and 126% in volume.
2. As Australians, we spent $9.5bn online last year which equates to 3.8% of overall retail spending and 5.2% of discretionary spending.
3. Something that we will be sharing with many of our prospective e-commerce customers is that the largest rise in sales came from online retailers with no physical presence. These online-only retailers accounted for 30% of spend, but this segment was growing at 75%.
4. Group-buying websites grew at a jaw-dropping rate of 557% but account for only 16% of online sales.
5. Fashion sales grew at 230%, and this is probably why so many of our new e-commerce customers are fashion retailers.
6. Around 50% of purchases went to Australian online retailers and 50% went offshore.
7. In terms of offshore purchases, the goods that Australians are purchasing in biggest volumes are sporting and outdoor, cosmetics and beauty products, books, media and fashion.
8. The biggest local purchases go to liquor, gifts, cards and florists. Interestingly the report identified potential areas of growth as liquor, sporting and outdoor, electrical and health/pharmaceutical.
9. Men were slightly more likely to buy online than women. 
10. The non-discretionary end of the retail market, i.e. supermarkets, has remained fairly immune to online retail. 

In addition to the very promising statistics about online retailing, the report sees tremendous opportunities for further growth.  It is noted that online penetration in Australia is behind many other developed countries such as Britain and the US. Assisting this growth will be the fact that Australians are adopting smartphones at a rate ahead of other developed countries. The idea being that this channel will generate a much higher percentage of online sales in the near future. 

We see this report as really exciting news for the web design and website development industry. Despite the overall Australian economy being sluggish, it is still boom time for online business. There are massive opportunities for start-up businesses to still develop a successful online store, as well as existing bricks and mortar businesses transitioning online. This is evidenced in the work of our Online Marketing Team who consistently note that competition in Google Australia for top billing across important keywords is very real, but great rankings are far more achievable in a short space of time when compared to the more mature online markets such as the USA & UK.