Have you really thought about yours?
Has Australia’s love of online shopping peaked yet? Not according to the experts with more around 50% of those of us over 14 years of age, purchasing something in any given month. And if the predictions of global ecommerce sales set to double between 2018 and 2023 – that would put us on track to see a total spend of AUD$60 billion – yes, billion with a B, in the next couple of years.
Top of the list according to National Australia Bank department and variety stores are the fastest ecommerce segment in the market. But top purchases, according to Roy Morgan research are entertainment and leisure products (think Netflix and gaming) but also high on the top purchases list are fashion – which is starting to decline, food and beverage, books, electronics and travel products – with online purchases of children’s and pet products becoming increasingly popular.
And despite all the doom and gloom around during the most recent holiday season with fires and floods, many etailers were seeing revenue growth in the vicinity of 15-20% per year.
However, even with more shoppers entering the market, that growth rate is likely to fall as more and more retailers, both local and overseas, enter the market. So how best to compete?
It’s those online businesses that offer speedy shipping and easy returns that are outclassing everyone else in terms of growth. Gone are the days a la The 4 Hour Work Week, where you could wait and batch your orders x days a week/month, when it best suited you or you were ready to do them. No, these days, customers are wanting their precious purchases preferably five minutes ago, but will settle for tomorrow or the day after at the outside.
So speed of shipping is important, but almost as important is cost. Research has found that 65.5% of online orders placed by Aussies come with free shipping. That, then creates an interesting conundrum for those not offering the same. It becomes both a customer expectation and deal breaker with 60% of shoppers abandoning a shopping cart if the cost is higher than expected. (source: eMarketer, SAP). So think about how you might factor the provision of free shipping into your costs.
Packaging as part of your shipping strategy
Another key part of your shipping strategy to consider is your packaging. If your product arrives to a customer damaged, then without question, it comes back or is refunded – costing you both time and money and leaving the customer with a negative experience. So appropriate and safe packaging becomes almost a hygiene factor thing. But packaging, shipping and logistics and its impact on the environment might also be worthy of consideration. Wherever possible, consider making a move toward sustainable packaging – losing the plastic overwrap, excessive paper and smaller boxes to both decrease shipping volume and create a theoretically smaller environmental footprint. Can your packaging (and product) be returned, recycled, reused or composted. Whatever you can do to both reduce landfill and make your customers feel good about their purchase will help you to stand out.
As Australians become more online shopping savvy and are prepared to shop internationally, your business has a great competitive advantage – chances are your products are already in the country and that gives you a time and cost advantage. So make sure you’re playing your advantage.
And that’s where we can help. If you’d like to better play your home advantage, deliver on your customer’s shipping expectations and create a sound shipping strategy for your business moving forward – freeing you up to grow your business, we’d be delighted to talk. You can contact us via the form below.