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Online Shopping Causing Structural Change To Retail
The PwC/F&S A/NZ Online Shopping Report predicts online shopping within Australia this year will hit A$16 billion, up almost 1 percent on last year – and should reach $26.9 million by 2016.
Meanwhile offshore online shopping has increased by 20 percent to $7.2 billion, now making up 45 percent of Australia’s total online shopping spend.
All this means Australian retailers need to rethink their business models, says PwC global retail and consumer advisory leader, Stuart Harker. He notes that there has been a shift in the motivation for consumers to buy online, with 55 per cent saying lower prices is the most important reason, up from 50 per cent last year.
Says Harker: “With online shopping becoming increasingly all about price, and less about convenience and range, retailers are under greater pressure than ever to give consumers a compelling reason to shop with them.”
Now, Social networks give retail brands the opportunity to form a relationship with millions of customers and also speak to them individually. A recent social commerce study by JWT Intelligence highlighted the effect social is having on shopping. It found that over 40% of men and over a third of women are more likely to purchase something if a friend has recommended it on a social network.