With the cost of living still impacting Aussie consumers, they continue to look for ways to control their expenses and minimise price increases when shopping online.
According to the Australian Ecommerce Report 2023 by IAB Australia and Pureprofile, 67 per cent of consumers says convenience is still the number one reason for purchasing online, however, with recent rises in the costs of living, the report also found consumers are increasingly focusing on discounts, loyalty programs and seeking price comparisons.
“Australian consumers are increasingly enjoying a mix of online and in-store shopping, but it’s clear retailers face a new set of challenges with shoppers who are price sensitive seeking value for money in their brand choice,” Gai Le Roy, CEO of IAB Australia comments.
“We know that constant discounting and undercutting competitors is not a long-term strategy, but retailers will need to consider how to offer a clearly articulated value exchange for consumers.”
The report shows that loyalty programs are increasingly important with 62 per cent of online shoppers increasing their usage as they look to enhance their shopping experience while saving money.
Nine in 10 online shoppers remain signed up to at least one shopper rewards program with 44 per cent of those signed up to a rewards program have four or more cards. Half (52 per cent) of online shoppers pay a fee to subscribe to a retail loyalty program.
“Pandemic behaviour shifts have become sustained habits for consumers with personalisation and relevance now the expectation, along with increased convenience and faster delivery,” adds Martin Filz, CEO of Pureprofile.
“However, it’s good news for retailers with online retail holding stable as consumers maintain the same frequency of purchase as a year ago, even if they are more cautious.”
While loyalty programs are providing retailers with rich behavioural data, trust, transparency and a clearly articulated value exchange with benefits delivered to consumers is key to underpinning successful retail marketing.
Concern with how retailers use shopper data increased over the last year with 60 per cent reporting some level of concern about how data collected via loyalty cards (up from 51 per cent in 2022) and 60 per cent concerned about data collected via transactions (up from 55 per cent in 2022).
Key learnings for retailers include:
• 62 per cent of online shoppers have increased the amount of time they spend shopping around doing research. Having information readily available and an easy research process will increase shopper confidence.
• Search remains key to 64 per cent of shoppers in their process of discovering brands when shopping online, but it should be combined with other channels to maximise brand and sales outcomes.
• Half of online shoppers are aware of shoppable advertising and 16 per cent have purchased this way.
• Retailers’ own stores and communications are also key to shoppers discovering products and brands; 60 per cent of online shoppers often read content produced by retailers.
• Retailers should amplify communication of their authentic ethical and sustainable credentials as they are compelling reasons for brand choice, particularly amongst younger generations.
• Social media and influencers are key to millennial and gen Z online shoppers with 52 per cent agreeing social media is an important part in how they find products they buy and 41 per cent identifying influencers as a useful source to discover new products.
