Yep, Amazon Australia Is Going To Be Huge

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Amazon is setting up shop in Australia, and according to a recent survey, a massive 90 per cent of us online shopping-types will use the service - if it comes good with the low prices, vast selection and fast delivery we've been promised, of course.

And why wouldn't we?

The results come from an independent survey of 1,001 Australian adults who have shopped online at least three times in the last six month, commissioned by parcel delivery service CouriersPlease.

The survey initially explored whether online shoppers currently prefer purchasing from retailers that specialise in a single category (such as fashion or technology) over online "marketplaces", where they can shop across multiple categories from the same site. More respondents (58 per cent) admitted they prefer to shop from a specialist online retailer than a marketplace (just 42 per cent of respondents).

However, when told that Amazon in Australia will focus on providing low prices, vast selection, and fast delivery, 90 per cent of respondents said they would shop from Amazon. Obviously.

The survey separated Amazon's three focuses – prices, selection and delivery – to gauge what was more important for Aussie shoppers. Lower prices is the main reason shoppers would purchase from Amazon: 68 per cent of respondents cited prices as the most common reason. A wider range of products is the second most common reason – important to 55 per cent of respondents – while just 30 per cent of respondents said fast delivery times is the reason.

Prices were more important for younger age groups than older generations. Those in their 20s and 30s cited lower prices as the main reason for shopping on Amazon, 71 per cent and 70 per cent respectively. This reduces with age, with 63 per cent of 50-somethings and 64 per cent of people over 60 years concerned about prices.

Vast selection was more important for older generations than younger generations with the level of importance decreasing with age. For people in their 50s, a wider range of product choice would be the reason 58 per cent would shop on Amazon, whereas this was only important to 46 per cent of people in their 20s.

Currently, 18 per cent of respondents said they purchase from Amazon and will continue to do so when it launches in Australia.

Surprisingly, only 11 per cent of 20-somethings currently shop on Amazon, the lowest of any age group. This jumps up to 22 per cent of people in their 30s, 16 per cent of people in their 40s, and 19 per cent of over-50s.

"Amazon's promises of lower prices and faster delivery times may put pressure on existing local retailers and the supply chain, but I believe we will become better at what we do," said COO of CouriersPlease, Hoy Yen Hooper.

Hooper says in the US and UK markets, where Amazon has a large share of the retail market, one-hour delivery through Amazon Prime and competitive prices are being offered.

In this survey, fast delivery was the least important reason for shopping on Amazon which may indicate that consumers in regional and country areas know that delivery may take longer as it is not commercially viable for many providers to have that sort of reach, Hooper says.

"Amazon will be attracted to delivery services that provide consumers with flexible delivery choices – such as enabling them to pick up at retail outlets such as newsagents, grocery stores and petrol stations – consistency in delivery, and reliability in keeping with expected delivery transit times," says Hooper.

"Consumers really value consistency and reliability: an item that is due to arrive within three days will arrive within three days 90 per cent of the time."

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Comments

    If they deliver fast at a good price, they will win. Australian businesses whinge and make excuses. I remember Presto had a jump start on Netflix but was unable and unwilling to fix its issues... so it died. Any business that follows the same path of excuse making will also die and it cannot come soon enough.

      I remember Presto had a jump start on Netflix but was unable and unwilling to fix its issues... so it died.

      It didn't die, it just kept getting rebranded. It's current name is Foxtel Now.

        Oh yeah! Love me some 'Foxtel Now & Chill' action

        No, Presto died. Foxtel Now was Foxtel Go - a different subscription, originally tied to traditional cable account holders.

          No no, Foxtel Now was Foxtel Play. Foxtel Go still exists.

    How is this good news for the small family run retail business' that are already struggling with high rents in Australia? If we close Australia will be a ghost town.

      Well if their is a mass exodus of small businesses in Australia. The economy shrinks, land prices collapse, building prices collapse and we enter a recession. Australian small businesses employ the vast majority of Australians. They're very sensitive to competition and the economy in general. That being said, Amazon has been around for a very long time. Their business model should be already known by Australian business. So Australian businesses should be doing what they can to differentiate themselves in a Globalised world. Tl;DR As long as small businesses arn't getting a free ride by lack of competition then they have nothing to worry about.

        Bear in mind also that lots of small businesses use Amazon as a storefront. Buy a CD and it's listed 10 times, one or two will be Amazon options the rest are small stores. Maybe it's time for some of these small businesses in Oz to get a unified online storefront (ie: Amazon). They might actually find they're getting more sales because people suddenly realise they exist.

        I guess, like the article says, I must be an older Australian, since I'm more interested in the increased range of products than *just* saving money. It'll be great actually having a choice of products. Or heck being able to buy stuff that's readily available in the US/UK but no one here bothers stocking.

        @gos: I agree with you. JB has at least three stores in the Brisbane Inner City. That's pretty ridiculous. The thing is though, if you're out in suburbia, or in a small town then your choices are pretty limited. You might have one music shop nearby, no games shops at all. So while I'd definitely buy from a bricks n mortar store given the chance, I'll happily buy online if I have no other choice.

          "or in a small town then your choices are pretty limited"
          Im hearin that!

            You can still buy online from JB etc, package delivery still works in small town Aussie.

            One thing we all need (me too) is a "large capacity" package "box" to allow unattended secure delivery and storage on our premises. Add the unique one time code on the delivery instructions to avoid the need for signatures etc. Some things are never going to change and we may still need to visit the PO every so often.

              While you can buy online from JB their selection is nowhere near big enough. I see a new CD coming out, go check JB and nine times out of ten it's not listed. I usually wait a couple months to see if the situation is gonna change, but no, if I'm lucky it improves from eight out of ten not listed. Same with a lot of movies.

              They need to work out a better deal with their Aussie distributor or straight up bypass them and special order from overseas.

      These small businesses need to be smart; either ramp up online presence, increase customer loyalty/market share by providing the very best pre, purchase and post service, or as a final leg to the strategy sell their products via the Amazon marketplace, use Amazon's huge presence to their advantage. Another strategy could be to become a supplier of Amazon, though there would be per-unit sacrifices, even if the gross throughput were massively increased.

      If you know anything about amazon then you would know a lot of small retail businesses use it to sell their products in the USA...so if the same businesses here want to do the same then they will survive as the ones in the USA have... it is just moving forward with the changes of the times... I am all for it they offer lower prices and fast delivery... and still get the products I want... good deal I think...

    It all depends on the Australia tax.

    Honestly prefer shopping at retail stores if they have what I need/want, even if the price is slightly more. The ability to see the product before buying is important to me. The problem retailers have is density, they have expanded to too many locations, having too many stores, too few customers per store. Do we need a JB on every corner? This means more overheads. I think we will see a move to less shops/larger centralised warehouse type retailers which will be good news for everyone, although investors in retail space might loose out. Have a look at
    Dead Malls. https://www.youtube.com/watch v=mOlffr73fuM&list=PLNz4Un92pGNxQ9vNgmnCx7dwchPJGJ3IQ
    This is where we are headed.

    Last edited 23/06/17 9:38 am

      Not wrong about the JB on every corner. I wonder if there are still three within walking distance of each other in the Perth CBD. And there used to be three EB Games in the same area - now only one. Lots of dead retail space, which doesn't look good in the middle of a city.

    it does make me sad that this is the way things are going. brick and mortatr stores going out of business, people losing jobs. unemployement going up. bigger cost to tax payers. its an ugly run on effect that doesnt help anyone in the long run.
    gotta love consumerism hey? i know this is a 'worst case scenario' view, but its not that far fetched.
    im all for business staying in australia, manufacturing staying in Australia and jobs staying with humans. its the only way i think we can have a 'happy', functioning society that we can safely leave for our kids and our kid's kids.

      Buying online will increase to-a-point. Most shoppers still need to see and try items before they buy as advertising is misleading. I don't think it will as big of a change. eg Clothes stores wont change. I will always go and try on clothes and shoes first, always.

        Some online clothes retailers like 'The Iconic' offer free returns on items up to 100 days. They even pay for the return shipping. I'm sure others offer a similar service.

        I personally don't buy a lot of clothes but I know people who 'buy' 5 items and return 2 or 3 that don't fit or they don't like.

          Free return shipping is not a business model I would invest in. I'd see a online warehouse service that supplies a slightly more expensive retail service as a significantly better business model. Having to pay $15 return shipping on a $5 item is not smart money. Especially considering the volume of returns they would be processing plus the human cost let alone the product cost (cannot resell a used item as new).

          Last edited 23/06/17 3:37 pm

          I've bought clothes online, but only from a (fairly) reputable retailer - Rivers. I've bought from physical Rivers stores and I know that their sizes are accurate and if I pick a medium it'll fit. I'd be reluctant to buy from a random clothes store online though.

    The thing is i do like to support local retailers, but they make it very hard, Case one, i recently received a uKeg, i do a lot of homebrewing... it needs 16g co2 chargers. Go to a local homebrew shop and they sell a 4 pack for $15, go online and a Aussie website sells a 30 box of them for $35 add $10 delivery, for that price at the shop i would only get 12 for the same price.

    Case dos, last sunday i bought a kegerator, needed co2 cylinder and a keg but lo and behold all homebrew shops in Adelaide were closed, normally this wouldn't be an issue but i work arvo's and saturday overtime so i don't have any time during the week to so out shopping so this stuff, go onto ebay got everything i need at a much cheaper price.

    Ok it might be a bit petty but when someone is time poor and shit is closed what am i supposed to do? sit there waiting until the stars align or go to something that is open 24/7 and requires literally no effort?

    I'm honestly not looking forward to it, we'll except as a big middle finger to Gerry Harvey and his uncapped import tax.

    I expect a smaller range and much higher prices than the USA, while making it more difficult to purchase products not currently available in Australia by limiting access to the USA marketplace.

    I wonder if Aus Post has had the sense to team up with Amazon and help with deliveries?

      I hope not; we want effective and competent delivery not AusPost delivery.

        Give me parcel lockers over hour+ round trips to courier warehouses any day of the week. I'll never be home to receive a delivery.

          Truth be told, I do pay extra for courier services even for small deliveries.

          I basically do what I can to avoid interacting with AusPost where possible.

          Then again, I also work from home as I have to conceed; I have the luxury of a courier being viable while the majority don't.

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