Australian shoppers are set to spend an estimated $4.8 billion online during Black Friday and Christmas sales this year, according to a study commissioned by ShipStation-owned Auctane and Retail Economics.
Research data indicates that high interest rates and cost of living pressures may impact sales, with 46 per cent of Australian consumers surveyed planning to spend less than last year. The study also found that 78 per cent of respondents will cut back spending on non-food related items – up 24 per cent year-on-year.
Almost 40 per cent of consumers cited inflation as their biggest concern heading into the peak shopping period, while 20 per cent were worried about securing gifts due to a lack of savings.
Despite the stress, 72 per cent of buyers plan to do some of their spending online, with 48 per cent expecting to do majority of it via the web.
“In the face of economic caution marked by high-interest rates and cost of living pressures, it's encouraging to see the majority of Australians planning to do their shopping online. This shift may be indicative of changing consumer habits, particularly among younger shoppers who are seeking out holiday promotions and early deals,” Auctane's head of ANZ David Boyer said.
“While cost remains the king of considerations for Australian consumers, it's interesting to note that they are willing to pay a bit more for quicker delivery, with 57 per cent ready to shell out $6-7 for same-day delivery.
“These changing dynamics are driven by a digitally-savvy demographic under 45, who prioritise speed and convenience in their online shopping experience.”
The study also found that 35 per cent of Australian consumers planned to start their holiday shopping before October, with retailers looking to jump on this trend as one in four of the merchants surveyed intending to ramp up holiday promotions before the end of the month.
“In the face of cautious economic sentiment, it’s promising to see retailers are optimistic about peak season demand. As we navigate through these shifting consumer trends, it's clear that the e-commerce landscape is evolving,” Boyer said.
According to the study, 72 per cent of Australian shoppers believe online marketplaces offer better value than individual retailers, with almost half of respondents finding the main benefit to be competitive prices and deals.
The convenience of delivery also wins over shoppers, with 62 per cent of respondents believing they usually have a fast and reliable shipping experience.
The surveys were undertaken by Retail Economics last month and include answers from a sample of more than 8,000 nationally representative households and 2,000 online sellers across the US, Canada, Australia, UK, Germany, France, Italy and Spain.
ARA urges State governments to deregulate retail trading hours
In the lead-up to the holiday season, the Australian Retailers Association (ARA) is calling on the Queensland, South Australian and Western Australian governments to deregulate trading hours for physical stores.
ARA CEO Paul Zahra has come out in support of eliminating regulations in all three States, citing a need for change as retailers try to address declining discretionary spending during the holiday season.
“Customers expect to shop where and when they like – and they expect the same convenience in physical stores as they get online. The settings in the three states that have yet to deregulate are restrictive and don’t reflect the 24-hour retail economy we see around the world,” Zahra said.
“This is a significant disadvantage to retailers within those states. It inhibits their ability to maximise sales at a time when higher costs of doing business and higher levels of debt are creating significant pressure, particularly for small businesses.
“These issues are most evident as we head into the all-important Christmas trading period when many discretionary retailers make up to two-thirds of their profits. Customers and retailers in Queensland, South Australia and Western Australia are worse off because of the highly regulated nature of trading hours in these three states.”
According to the ARA, the WA government declined its request to commence extended trading hours for the upcoming holiday period one week earlier than planned.
“Another example is Queensland’s limited Holiday Trading Hours, which are complex for consumers and retailers alike. Retailers are broken down into a confusing classification of exempt and non-exempt businesses, and trading hours are different in specific areas or zones,” Zahra said.
“This creates confusion for retailers and consumers, and dampens consumer spending at a time when we should be doing everything we can to grow sales.
“And South Australia’s Holiday Trading Hours are difficult to navigate for consumers, with different restrictions placed on retailers on certain public holidays like New Years Day – with CBD retailers able to trade, while metropolitan shopping districts are closed.”
States that currently have deregulated trading hours include New South Wales, Victoria and Tasmania.
"Differing shop trading hours between states is confusing and unnecessary. We urge Queensland, Western Australian and South Australian governments to reconsider their approach and embrace a more competitive, flexible, and consumer-centric retail environment, " Zahra said.
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