This article will highlight ‘how to sell to Aussies online’ including the unique challenges Australia poses to online sellers. Please note that ‘online selling’ in this instance includes marketing your products or services online, to the customer, during their decision making process.
According to NAB Online Retail Sales Index (NORSI) Australians spent about $24 billion online. Whilst this is a large number, it equates to approximately 7.7% of sales in traditional physical stores. Major Australian retailers such as Coles, JB Hi Fi and Woolworths still have online sales at about 4 – 5% of total sales. Australia still has relatively small online retail sales vs similar countries. For example, online retail sales accounted for 12.1% of retail sales in Asia Pacific, in 2016. Other businesses, such as Netflix, can have 100% of their sales online to Australians.
Aussie consumers want to buy online
The following statistics highlight that Australians’ shopping behaviours are changing. With increasing rates of access to the internet and mobile phones usage Australians are now more likely than ever to buy and/or research a product or service online before purchase.
Some statistics from Google about Australian consumers:
90% have internet access
80% own a smart phone
On average people spend 3,360 minutes online per month
64% of all transactions include an online element – including researching products and services
Other similar statistics that support Googles’ numbers are:
85% of the Australian population has internet access (Internet Live Stats).
19.4 million mobile phone users in 2019. (Statista)
35% of eCommerce transactions were completed on mobiles in 2015. (PFS)
27% of consumers, made a purchase with a mobile, weekly in August 2016 (emarketer)
These numbers all highlight that Australians are now using the internet more in their purchasing journey, so how can you sell to Aussies online?
Can your business meet Aussie consumers demands online?
The 2 key points here are
- if you take your current business online there is a risk you could damage your existing brand / reputation
- if you launch a new online business, without the correct research, it may fail
Before you invest in selling your product or service online you need to consider some important questions / concerns. Research by Choice and the NSW Department of Fair Trading has highlighted there are issues selling to Aussies online including:
39% of Australians face problems when buying goods and services online
About half of the problems are due to logistics – late delivery, damaged goods or no delivery
Product issues such as dealing with a faulty product, product is different to what was advertised
Pricing issues including unexpected fees and charges
Even eBay admits there are (some) disadvantages to online shopping including:
Shopper cannot personally check the item
Having to wait for delivery
You should consider the following questions before selling online to minimise the risk of damaging your existing business / brand and / or a new online business failing, by not meeting Australian customer expectations.
1 How do your consumers prefer to shop?
Please remember Australian consumers can use ‘online’ during different stages in their decision making. If possible, list the steps people normally take, when buying your product or service, and consider how consumers may use online during this journey. It is now very common for Australians, particularly younger people, to research products and services online before purchasing.
Australian consumers still prefer buying most categories in store. For major retailers, e.g. Coles, JB Hi Fi and Woolworths less than 5% of total sales are online. For other businesses, such as Amazon Australia, they can deliver their products 100% online. This means there is no rule for which products or services Australians will buy online. Personally, I suggest for products or services that can be delivered quickly and easily, e.g. streaming Netflix, downloading music, then Australians are more likely to complete every stage of the path to purchase online. For other products and services that require the customer to consider different options (anything from testing how fresh the tomatoes are, to physically viewing the picture quality of a TV screen) then Australians are generally more likely to buy in store, after researching online.
2 How can you deliver your product or service in an acceptable timeframe?
Australia is a big country with a small population so logistics / delivery is an issue. Today, 90% of the Australian population live in urban areas but the distance between these urban areas can still be a major issue. For example, if you use Australia Post to send a package from Townsville to Perth it can take over a week to arrive. Will your customers accept these long lead times?
Obviously, businesses like Dominos can deliver in 30 minutes, after the order is normally placed online. Personally, I think delivering in this time frame is a major reason why Dominos has approximately 50% share of all online takeaway orders. (AFR) Personally, I think retailers such as Coles and Woolworths have less than 5% of their sales online, as they expect customers to order the day before delivery.
3 How will you deliver your product or service?
There are a number of different e-commerce business models for products including ‘click and bricks’ (online and store) and 100% online. Delivery can be made using company owned logistics or third-party service providers or both. Some businesses offer different delivery options such as Click and Collect and home delivery, from a warehouse or local store, or sometimes the product is sent direct from the supplier to the consumer.
For service providers, such as Netflix and Apple iTunes, you may be relying on third party ISP (internet service providers) for delivering your service. You need to consider whether the infrastructure available is suitable for delivering your service. Personal note – I have the NBN and I hate it when I am watching Netflix and it buffers.
4 How much is your customer prepared to pay for an online service?
In September 2016 McKinsey & Company noted in their report, Parcel delivery, the future of the last mile, that only 25% of respondents (China, Germany, US) would pay a premium for same day or instant delivery i.e. 75% would not pay a premium. The issue for Australian online sellers is Australian consumers may not pay for the convenience either. Canstar Blue Online Grocery Shopping for 2017 highlighted the biggest frustration for Australians currently using online grocery shopping was delivery costs – 25% of respondents.
If, are considering these questions, you do not believe you are ready to sell a physical product online, you may wish to consider partnering with online retailers such as eBay and Amazon. These platforms have many advantages, especially giving you access to many customers, and can make the process of selling online easier. The only potential negative is the fees and the commission (% of sales) they charge can dramatically impact your bottom line.
How to sell to Aussies online
If, after considering the questions in the previous section, you wish to sell your product or service online then the following is a starting point to develop your online business. For other people, this section will provide tips on how to sell your product or service online to customers during the decision making process.
I must stress that all businesses, and their relationships with their customers, are unique so you will need to tailor the following areas to suit your business and its customers – use as a guide only. For example, the way people in regional Australia shop is different to how people in major cities shop.
Your business will require a website to be perceived as ‘real’ by Australian consumers. This is called ‘authority’ in marketing speak. If your business does not have a website, then Australians consumers will assume you an amateur and their opinion of your business and the products and / or services offered will decrease.
The major advantage of having your own website is that you can control all the content and functionality. Other sites, e.g. Facebook, have rules limiting what you can and cannot publish.
The biggest tip for people who own a website is to regularly review the site and update the content. The biggest mistake people make is ‘launching’ a website and then not changing anything on it for years. When Australian consumers visit your site they expect to see fresh content. Another tip is to ensure your website works on multiple devices, e.g. is mobile friendly.
If you do not have a website some tips to get you started:
Normally the easiest, cheapest way to create a website is to use a ‘website builder’. If you are selling physical products Shopify is commonly used, and for other businesses you may wish to consider GoDaddy. The negative of a ‘website builder’ is that they generally offer limited options to customise the site. I strongly recommend you buy a plan that includes SSL and SEO.
The next option is to have a website created. Personally, I suggest WordPress software as it is widely used – 27% of all websites in the world use WordPress. You can buy a ‘theme’ and then add your content and pictures to create a basic website. The initial cost of a WordPress site will normally be more than a ‘website builder’ but the software and many of the plug ins are free, so over time they can be cheaper than a ‘website builder’. The big advantage of creating your own website is that you can customise it and have a site developed that is tailored to your business and your customers needs.
Now that your website is created you will want people to visit it. Good SEO (search engine optimisation) – can increase the quality and quantity of traffic to your website.
I shall keep this section relatively simple, but I do warn you that SEO can become technical. Some tips about SEO:
The site set up needs to be correct, e.g. meta tags. Google webmasters can test your site to see if Google can read it.
Much more than just keywords. When google ranks your site only about 5 – 10% of the ranking is based on keywords.
New and relevant content, e.g. blogs and posts, are required.
High quality hyperlinks are very important. A ‘link’ simply lets visitors easily navigate from a page to another. Backlinks from other high authority sites are best.
Site should have SSL (security technology).
By successfully completing the above tips (and some other technical stuff) Google will index your site highly and you may appear on Page 1 of searches. Your site will also be an ‘authority’ site.
Social media is simply other websites that allow people to create and share content, e.g. Facebook.
Sensis Report for 2017 highlighted that 79% of Australians use social media. Younger people are more likely to use social media.
|Age||% people using social media|
|18 – 29||99%|
|30 – 39||96%|
|40 – 49||86%|
Another key point is that people are more likely to access social media on their mobile phone.
|Device||% people using|
Social media has a number of different brands, that deliver different experiences to different people. The key to a good social media plan is to partner with the right brand for your business and customers. Personally, I would not recommend a brain surgeon advertise on Gumtree – not a good match!
The following table highlights the major social media platforms and their strengths.
|Platform||% people using*||key strength|
|32%||Short message, #|
|10%||Images to inspire people, DIY|
* % of people that use social media
To determine which platform is correct for your business and its customers I suggest you visit and review these platforms.
Some general tips about social media:
You must be active, e.g. if people comment on your posts you should read them, and if necessary reply.
Tailor your message to the different platforms, e.g. posts on Facebook and LinkedIn should be different.
Facebook is a site designed to allow people to interact with their family and friends i.e. a social network.
If you are planning to post, have a business page, on Facebook please be aware of planned changes to the site. On 11th January 2018, Mark Zuckerberg, announced a major change to Facebook that will limit how businesses can advertise / promote on Facebook. These changes may limit the benefits for your business being on Facebook in the future.
Historically many businesses have focused on Facebook due to the large number of users. Facebook Australia has 15 million active users (socialmedianews). This strategy may be apt if you are selling a basic, widely used service or good, to the general population. If you selling a specialised product, to a niche, then Facebook may not be the best option.
A major tip for promoting your business on Facebook in 2018 is to use video. Video is normally preferred by customers and is supported more by Facebooks’ new algorithm. A link to Facebook that helps explain how to use video on Facebook.
Facebook bought Instagram in 2012.
Instagram is a great platform to share photos and videos. For products, e.g. fashion, that your customers want to see then Instagram can be a better option than Facebook. It is also ‘usual’ now for people to photograph meals at a café, restaurant and share them on Instagram too.
Twitter is an online news and social interaction site that allows people to share short messages, called tweets. Originally all tweets had to be 140 characters but now this has been increased to 280.
Twitter is great for getting a message out, e.g. new product now available. Via the use of hashtags (#) people can then have a discussion on Twitter about an event, product or service that is being discussed. When a topic is getting a lot of responses then it is ‘trending’ i.e. lots of people are posting tweets.
Microsoft bought LinkedIn in 2016.
LinkedIn is a business and employment orientated site that is mainly used for professional networking. If your target market is professionals, such as lawyers, then this site may be the best platform to connect with your target market.
Pinterest is a site that normally displays images, designed to inspire people to do things i.e. great for DIY ideas and tips. If your product or service is a niche, e.g. model building, then Pinterest may be the best platform to connect to your target market.
This quick overview of the major social media platforms, there are more, has highlighted how unique each one is and you should consider which is best for your business and its customers. As a general rule, most businesses will use 2 to 3 platforms with messages tailored to that platform.
SEM, search engine marketing, is paid online advertising.
Most social media platforms and search engines offer SEM. Due to the large number of users most businesses advertise with Facebook ads and/or Google adwords. The key to successful SEM is partnering with the right platform and then tailoring your message to the target market on that platform.
Personally, I suggest once your website, SEO and social media are working (the free online advertising) then consider SEM. For example, if you use paid advertising, such as Google adwords, to get people to visit your site and the site does not convert them into customers, then you have wasted your money.
To track how successful your SEM is I strongly recommend you use an analytics site, e.g. Google analytics, to better understand what effect the SEM has had on your online business. Most people who see an ad online will click through to your site to do more research about your product or service.
To better understand SEM you may wish to research PPC – pay per click. This is how most SEM is charged.
As Australians shopping behaviours change to include more online shopping, including reviewing products and services, I strongly suggest all Australian businesses have some online presence.
This quick blog has highlighted there are a number of different ways to sell to Australians online and I suggest you consider what are the best options for your business and its customers. I must stress that once you have your own website, social media accounts then you must regularly review and update them to get the best results – unfortunately ‘set and forget’ does not work online.
The information provided in this blog post was general in nature. If you require more information I offer a free initial consultation by completing a contact us form.