Reaching Online Shoppers in Australia

Creating the right partnerships will unlock the Australian e-commerce network.

Will Gensburg | UPS

Retailers looking for their next cross-border, e-commerce opportunity should look down: Down Under to be exact.

As early adopters of international online shopping, 77 percent of Australian consumers use a smartphone, 65 percent shop online and 40 percent purchase clothing and footwear from an international merchant, according to the Ecommerce Foundation

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Australia is a growing force when it comes to e-commerce sales.

Australia is a growing force when it comes to e-commerce sales. In 2016, Australia’s e-commerce sales totaled $9.5 billion with sales projected to increase to $15.4 billion by 2021, according to Statista. While this is significantly lower than China’s 2016 online sales of $752 billion, consider that Australia’s population is roughly 2 percent the size of China’s.

With high purchasing power and disposable income, the Australian online shopper offers huge growth opportunities for online retailers. Don’t miss out on the opportunity to capture sales from this high-performing e-commerce market. Here are some tips for attracting the Australian online shopper.

Localize your communications

Language is one of the most important components when providing consumers with a seamless and localized online shopping experience. While this seems like an obvious point, it can be surprisingly easy for retailers to miscommunicate with their customers – even when they speak the same language.

Imagine what would happen if you weren’t specific with your online advertising in this scenario. Selling a Barbie™ in the U.S. is a doll, where in Australia it could also be interpreted as a grill (think “shrimp on the barbie”).  Not localizing product descriptions is a sure-fire way to lose customers before they’ve even started shopping.

Product seasonality is also a major factor when localizing your online shopping experience. In Australia, seasons are opposite from those in the states. This is extremely important for promotions and sales. The last thing a U.S. retailer wants to do is promote winter gear to an online shopper in the middle of an Australian summer.

Be prepared for changes in duty and tax exemptions

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Consumers in Australia have high expectations for shipping and delivery.

Australia has historically had one of the most generous customs exemptions in the world for online shoppers, with no customs duties or taxes on orders less than AU$1,000 (approximately US$750). That’s anticipated to change on July 1, 2017.

To help Australian retailers be more competitive, Parliament is considering legislation that would impose duties, taxes and a Goods and Services Tax (GST) on imported online shopping orders for retailers that sell more than AUS$75,000 a year.

One of the provisions includes a requirement to notify consumers about the GST costs of their purchases, which could require merchants to calculate and invoice these costs before the delivery is made.

To fully succeed in this market, it will be critical to proactively calculate and display the various duties and taxes when conducting business in the Land Down Under. Creating a customized online shopping experience is easier with the help of industry tools and solutions like UPS i-parcel.

This technology gives retailers the ability to tailor promotions, shipping programs and product availability without complex IT infrastructure. It takes the headache out of cross-border e-commerce, making it easier for retailers to win over customers and complete sales.

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The right partner will also help retailers ensure efficiency across the supply chain.

Understand shipping preferences and expectations

Consumers in Australia have high expectations when it comes to shipping and delivery. According to a report by SaleCycle, Australia has the highest rate of online cart abandonment in the world. Reasons include high shipping costs, lack of free shipping and the number of shipping options provided.

However, when it comes to cross-border, e-commerce deliveries, Australians are a bit more forgiving and understanding. In fact, 36 percent of Australian consumers expect shipments to take two weeks or longer. The country’s sheer size and transportation challenges in getting an item from point A to point B play a role in setting these consumers’ expectations.

For retailers looking to do business with the sixth largest country in the world, it’s imperative to partner with a global shipping provider that has the expertise, operations and logistics infrastructure to help meet customer demand.

Don’t get left behind

Conducting business across borders may seem like a daunting task – but it doesn’t have to be. By partnering with a third-party logistics provider with cross-border, e-commerce expertise, retailers can localize shopping experiences and meet evolving customer demands. The right partner will also help retailers ensure efficiency across the supply chain to keep costs down and customer satisfaction up.

Now is the time to take action, mate. goldbrown2

This article first appeared on Digital Commerce 360 and was republished with permission.

You might also like:

Think Local, Shop Global

Winning With Shoppers in China

How 2017 Will Challenge and Reward Retailers

Will Gensburg is the Vice President and Managing Director of UPS i-parcel.

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