The latest data from the Australian Bureau of Statistics (ABS) shows that total online retailing sales were $4.03 billion in February 2024 in seasonally adjusted terms.
This is more than double the monthly online sales of $1.9 billion recorded in February 2020, with ABS’ online sales graph looking more like a rollercoaster between then and now.
Seasonally adjusted online sales rose 1.1 per cent ($42.7m) in February 2024, following a rise of 1.3 per cent ($49.9m) in January 2024. Seasonally adjusted through-the-year sales are up 2.9 per cent ($114.3m).
However, original online sales in February 2024 fell 4.3 per cent (-$159.0m) to $3.5 billion.
“To meet this phenomenal shift in online purchasing behaviour, online retailers have been urged to create frictionless, fast, secure and reliable platforms to absorb the increase in consumer traffic,” National Online Retail Association CEO Katie Derrett told Ragtrader.
“The focus now turns towards retention and loyalty - and trust building initiatives that increase customer lifetime value. AI-driven hyper-personalised CX [customer experience] is now key in maintaining share as well.
“Australia's rapid online growth has also led to the activation of international players, the rise of Temu and Amazon are shaking up the landscape,” Derrett said. “Given these changing dynamics, our chair, Paul Greenberg's mantra is to go big, go niche or go home.”
Speaking on the jagged rise and falls over the pandemic, which continued well into 2023 post-pandemic, Derrett said it’s critical for online retailers to plan for peak trade earlier than previous years.
“We're seeing the wave of spending start to build around click frenzy and gain momentum through Black Friday and Cyber Monday to then bottom out earlier than previous years - at the end of December,” she said.
“We saw December sales drop by 2.7 per cent (ABS) which indicates that peak season is starting earlier and flattening by the end of the year.
“Gearing up for peak requires our online retailers to prepare for master agility and to adopt innovative fulfilment strategies - and ideally with the use of predictive analytics.”
Derrett added that despite the operational challenges that can arise from the rollercoaster ride of online spending over the last few years, she said the opportunity for retailers now is to create and omni-channel view of the customer.
“Perhaps we can label this a 'phygital' consumer lens which offers retailers the chance to build a cohesive omnichannel experience,” she said.
“Whilst talking to Simon Beard, founder of Culture Kings recently, he stated that 'Stores are for show and Online is for dough'. The retail store for many brands, now acts as the experience centre bolstering the online sales traffic.
“We can see this shift in so many of our traditional retail brands who are now creating cutting edge immersive experience stores which directly build online sales.
“The consumer eye is now on price, trust, reliability and ease of returns,” Derrett continued. “Retailers need to honour the shift in heightened price and value expectations and ensure that loyal customers are rewarded in demonstrable ways.
“Retailers are now expected to price match and to wear their reliability on their sleeve. We're also seeing a u-turn in promoting lifetime value of products rather than fast throw-away spending. Customer empathy at this time is the new black for retail marketers.”