Retailers need to be innovative to capture shoppers’ cash
[25 July 2012]
- Retail is at a critical juncture as online shopping expenditure in New Zealand has grown by 19% in the past year, and is expected to grow by more than 14% per annum over the next four years.
- A whopping 1.9 million New Zealanders aged over 15 are expected to shop online and spend an average of NZ$1,659 in 2012.
- International websites count for 35% of New Zealand online shopping and is expected to grow.
These are some of the key findings revealed in the Australian and New Zealand Online Shopping survey released by PwC and Frost & Sullivan.
The report finds online shopping in New Zealand will increase to NZ$3.19 billion in 2012, and is predicted to grow to $5.37 billion by 2016.
PwC Partner and retail industry spokesperson Julian Prior says, “The research shows online is now ‘mainstream’ for New Zealand shoppers as they hunt for the perfect purchase. It’s all about having the ability to access the best price on offer, while perusing a greater and wider product range.”
Online retail sales now make up 5.9 per cent of New Zealand retail sales, up from 5.1 percent in 2011 and comparable with Australia’s 6.3 per cent.
“As customers demand value for money and the convenience of buying anytime anywhere, there is only one certainty going forward, and that is, the way shoppers buy products will continue to change,” says Mr Prior.
Shoppers are surfing the web for an ever increasing range of products. The most popular online purchases are electrical items (65%), clothing (62%) and books (52%). The biggest jump has been food and groceries, now purchased online by 21 per cent of shoppers.
The report also found growth in online shopping is being driven by evolving digital tools and increasingly sophisticated and connected shoppers, who have high expectations of the retail experience.
Over 36 per cent of online purchases are now made on mobile and smartphones, and 12 per cent on tablet devices, which is expected to drive continued growth in online shopping.
“Retailing today is more than selling from a bricks and mortar shop, although we shouldn’t expect our High Street stores to disappear as the physical store will continue to play an important part of the New Zealand shopping experience, ” says Mr Prior.
“It is encouraging to see New Zealand retailers are now beginning to embrace online retailing. In the absence of any real economic growth retailers need to be innovative and capture the opportunities that online presents. Failure to do so, will see more and more shoppers’ cash head overseas,” warns Mr Prior.
Currently, international websites count for 35% of New Zealand online shopping and that is expected to grow.
Mr Prior says, “Local retailers can compete with international websites through understanding what their customers want, how they want to buy it and generating high customer loyalty through a positive retail experience.”
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