Variety stores, online marketplaces and payment options
As you may read in our last blog, the world of online retail can be heavily influenced by your sales calendar and the latest in tech trends, but that’s just the tip of the iceberg when it comes to what drives your customers.
Online purchases have doubled between 2015 and 2017 and as the population becomes more familiar with e-commerce, consumers are continually figuring out what they like and don’t like (and so are we).
The future belongs to the 18-36s
A quarter of Australia’s population now belongs to the 18-36 age demographic, and these consumers aren’t afraid of online marketplaces. They know what they want, and they bring with them a set of expectations:
- Seamless transactions from end-to-end;
- Convenient online pay options; and
- Flexibility in delivery and pick-up locations.
The 18-36s know what they are after and online retailers have begun to accommodate for their needs. Payment services like Buy Now Pay Later (BNPL) or Afterpay are more popular and available than ever, along with the rapid growth phenomenon of online marketplaces and variety stores. Not only do Australians want their buying experience to be simple and streamlined; they want to do all their shopping in the one place.
Variety is Key
‘Variety stores’ is Australia’s leading online shopping category, accounting for over one third of total online purchases in 2017. Where online retailers once focused on a single product or category, they are now offering a wider catalogue—where anything from health and beauty to electronics and homeware can be added to same purchase basket.
Fashion items, in particular, have been a major category for variety stores, accounting for one in four purchases. This is closely followed by electronics (20% of purchases), while the variety store category as a whole has seen a 28.5% year-on-year growth. Due to the rise in popularity of variety stores in general, and the dramatic growth in fashion sales from this source, we expect to see more online retailers offering fashion lines through variety stores and online marketplaces.
Online Marketplaces and Discount Department Stores
Online marketplaces are also in high demand as consumers want to compare products through one centralised platform. Purchases from online marketplaces have surged 74.8% year-on-year, and are a major contributor to the rise of competitive pricing in e-commerce. Traditional retail stores, too, are adding a marketplace element to their online presence; Myer and Catch being two major names to benefit from this approach. While traditional department stores with an online presence enjoyed a meager 1.8% growth, those that offered a marketplace function were rewarded the true spoils.
The second largest contributor to the variety store category was the success of discount department stores. In recent years, such stores have struggled to create a noticeable online presence, but 2017 saw a 50.4% breakout in discount department online retail.
What do we want? Online Shopping! When do we want to pay? Later!
Aussies want to get their haul now and pay for it later—at least, this is what the statistics are telling us. Particularly when it comes to fashion purchases, the instant gratification of buy now, pay later (BNPL) services is driving major sales. Fashion-related purchases account for 57% of all BNPL transactions, accounting for a sevenfold increase from 2016.
BNPL services now account for almost 8% of total online spending, with the 18-36s leading the charge (forgive the pun). This trend shows no sign of slowing, either, so keep an eye out for further growth in this service and consider including a service like on your check-out page.
By focusing on the major trends of marketplace functions, BNPL services and variety store catalogues, you can give your business the upper hand in a rapidly changing environment. Trends catch on quickly and getting in on the ground floor of the ‘Next Big Thing’ in the industry can help to skyrocket your sales.
Trends in e-commerce aren’t just ‘trendy’, they’re the careful collation of big data, filtered down to give your business some insight into what you customers really want. The data doesn’t lie and by analysing Australia’s online consumer trends, you give yourself the best chance to get ahead of the pack.
If you’re ready to embrace ecommerce in a way that’s likely to delight your customers even function even further, we’d be delighted to talk to you. You can always give us a call on +61 2 9828 0111 (Sydney), +61 3 9240 300 (Melbourne) or +64 9 263 8855 (Auckland) or drop us a note via the form below. Alternatively, you can find a full list of available services here.