The online shopping market in Australia is growing strongly and will account for seven per cent of all retail sales by end of 2013, according to independent research firm, [xref:http://www.arnnet.com.au/tag/frost_and_sullivan|Frost & Sullivan|All on Frost & Sullivan]].
It forecasts in its latest research, Australian and New Zealand Online Shopping Market 2013 , that the total online spend will amount to $18.3 billion in 2013, with the average annual spend online per Australian online shopper to reach $1750.
And almost 90 per cent of online shoppers expect to increase or at least maintain their online spending over the next 12 months.
The study surveyed 1000 online shoppers in Australia.
Frost & Sullivan expects a continued growth in online sales over the next five years with a Compound Annual Growth Rate (CAGR) of 13.1 per cent and an increase in online sales as a percentage of total retail sales from seven per cent in 2013 to 9.8 per cent by 2017.
Frost & Sullivan A/NZ ICT practice senior research manager, Phil Harpur, said a greater variety and choice of goods offered from an increasing number of local and international online retailers, particularly in the fashion segment has contributed significantly towards stimulating retail purchases online by consumers in Australia.
“Overseas retailers have been actively targeting the Australian market over the last couple of years.
This has increased the overall level of competition in the local online retail market. Local retail chains have also stepped up their online activity, creating increased awareness amongst consumers and increased media coverage of online shopping,” he said.
In addition, Harpur claimed that mobile shopping has already seen widespread uptake in Australia – with 30 per cent of all Australian Internet users aged between 15 and 65 purchasing physical goods online with a smartphone and 19 per cent using a tablet in the last 12 months.
Harpur mentioned that the immediacy of mobile devices gives online retailers significantly more opportunities to engage shoppers with relevant offers when and where they are making buying decisions, encouraging impulse purchasing.
“As the concept of omni-channel retailing grows, online retailing will be regarded as an integral part of the overall shopping experience.
“By collecting and analysing online data, online retailers can make the online shopping experience personal, strengthening relationships with the customer by delivering customer preferences in real time, which can increase repeat sales.”
In another study by Frost & Sullivan Bricks and Clicks , it found that trends such as connectivity and convergence will change the face of the retail industry, allowing retailers to merge the digital, virtual and physical retail experience into a single ‘bricks and clicks’ model.
Frost & Sullivan visionary innovation research group analyst, Archana Vidyasekar, said this integrated channel will become the norm of the future, likely to be deployed by every retailer and worth $4.3 trillion by 2025.
Vidyasekar claimed brick and mortar retailers are already enhancing IT infrastructure and logistics to widen their online presence and tap this growing market.
“The proliferation of connected devices and the availability of faster Internet speeds have catalysed a change in shopping behaviour and fuelled market expansion,” she said.
She added that innovative business-to-consumer logistic models and the growing influence of social media, along with the convenience of online product research, comparison shopping and competitive pricing, will convert many online browsers to online shoppers.