It’s true that Australia and the wider Asia-Pacific region has witnessed an online buying boom over the last ten years. By population, the region which includes China, India, Japan and Indonesia has the largest global online market and although smaller by population, the Australian eCommerce market has shown remarkable growth and is currently a top-ten performer.
Fuelled by a robust economy and quality infrastructure, Australia has high business and personal level of internet use (86%) despite the disappointment of the less than successful National Broadband Network (NBN) rollout. There are over 19 million smart devices in use in Australia and 66% of our population regularly shop online. Furthermore, Australians prefer buying late in the day (6pm to 10pm) using their mobile devices so eCommerce retailers should make sure their websites are optimised for smaller screen devices and all the major web browsers.
The Australia Post Inside Australia Online Shopping preview report* (based on purchase and delivery data from 2017/18) indicated that buying online increased by 20.2% over the previous year.
Online shopping reached 9% share of traditional retail spend in FY 18.
So if you are only offering products at your bricks and mortar store, it might be time to add an online store to your retail operations. Local business owners are competing with big online retailers and dropshipping players keen on getting their slice of the action. eCommerce has a very low barrier to entry, with less overhead cost which helps with improving profit margins.
So what are Aussies buying online?
In 2018**, online marketplaces and discount department stores proved to be favourites. Aussie participation in mass sales events such as Black Friday, Cyber Monday and Click Frenzy is helping change buying behaviours. While there are growth trends across most industries, the top eCommerce verticals in Australia are:
- Consumer Electronics
- Clothing, fashion and accessories
- Homeware and appliances
- Personal and recreation
- Travel and accommodation
The Australia Post study reports that:
Variety stores are the go-to destination for online goods and services, and were the the largest and best performing category in 2017
Share of online purchases (top 6)
Opportunity is knocking for local Australian owners. Statistics show that 30% Australians do not trust foreign sites and prefer buying from domestic online sellers. This, and the continuing unfavourable $AUD exchange rate, offers a huge advantage to local eCommerce stores to compete with international counterparts offering similar products.
There’s no sign of a slowdown in growth so if you are not yet selling online, now is the time to get started as your target market is likely already buying online from someone else.
What could possibly go wrong?
More buyers are taking notice of online reviews prior to purchase. Gone are the days when the only reviews were complaints (often about service rather than product performance). Today there’s a growing trend of post-purchase positive reviews as more and more consumers value this type of information. The benefits of offering commenting now seem to outweigh the risks, however it’s important to remember that resourcing is required to moderate and respond to customer feedback.
On the downside, eCommerce retailers will also have to cope with issues such as warehousing and fulfilment, returns and replacement policies and credit card fraud. It’s clear that the way e-Commerce players deal with customer service and complaints will make the difference. Customers are more and more demanding and the number of individuals who haven’t been satisfied by the way their complaint was treated grew from 2 to 3% since 2015.
So what are the choices for local businesses to get online?
Depending on the number of products, building an online store from scratch can be a significant undertaking. Today, there is a wide variety of eCommerce platform options from which to choose and the decision will be different depending on each business’ existing online presence, as well as their growth plans for the future. The main players have been studied to highlight features, pricing and suitability for the following current business use-cases:
- No website yet
- Existing WordPress website (30% of all websites globally)
- Existing non-WordPress website (eg Wix, Squarespace, Weebly)
eCommerce platforms provide standard functionality including the ability to display products in an online catalogue, take payments online, manage fulfilment, manage customers, reporting and future marketing. More complex platforms add after-sales marketing and integration with POS for in-house sales.
An emerging trend that is expected to continue this year is ‘Headless eCommerce’. This means the presentation layer (front-end) of a website is separate from the eCommerce platform (back-end). By de-coupling the front-end from the back end, you gain more flexibility in serving branded content and better user experience without the resource draw when an all-in-one solution is in place. The challenge is to work out how the 2 systems can be presented in a seamless way.
Some of the platforms showcased below can be used as part of Headless eCommerce.
Magento Commerce is the most-used eCommerce platform across the globe and considered by many to be the leading solution for large and growth businesses who demand top-quality website design, next-level functionality, great user experience with future expansion built-in.
It’s included in the summary as first cab off the rank but it’s not for everyone. Magento Commerce cannot be considered a low-cost option as it’s a massive cloud-based, open source platform that requires some serious investment of time, skill and knowledge.
Even though you can get a free trial, you’ll soon find that you need to pay for what you need. Hosting is included but pricing depends on the number of products you have in your catalogue and the level of traffic you get on your website.
Recommended for large scale businesses who need bespoke functionality based on their industry along with an internal/external IT specialist and staff to manage the system.
With Shopify it’s possible to get an online store up-and-running within minutes if you only have a few simple products. There’s a great range of pre-built templates that accommodate your branding, or you can design the look and feel of their store yourself if you have the time, skill and inclination to do so. Or, you can engage a Shopify Expert to customise your store from the ground up. You can bring your own domain name, or purchase one through Shopify. If you already have a website you could take the headless eCommerce approach and use Shopify for your sales with links to it from your main website. It’s important to make sure the styling is consistent across both platforms.
Shopify stores include a built-in mobile commerce shopping cart. Your customers can browse and buy from your store using any mobile phone or tablet. Shopify have their own payment gateway but also allow you to choose your own 3rd party payment gateway. However, they add 2% on top of the 3rd party transactions fee so this can become very pricey.
Some businesses host their whole operation on Shopify. Online stores comes with a full-featured content management system. You can publish and categorise blog posts, create catalogues, encourage discussion, and moderate comments on your Shopify blog. There’s full access to the HTML and CSS of your store, making it easy to customise every aspect of your website. You can use your own domain name, or purchase one through Shopify. One negative aspect is the way they structure webpage URLs which can have SEO ramifications. While not significant for online sales, it’s not ideal if you have ‘About Us’ , Contact Us’ or blog pages for example.
There’s no product limit or restrictions on numbers of customers and sales but there are only 2 variants available for products. If you need more than just size and colour for any of your products you should look elsewhere. You have access to in-depth analytics of how visitors are using the store, and product SEO optimisation. Among other features are coupons, gift certificates and email marketing tools.
Recommended for businesses who don’t have website and are looking for a website focussing on online sales. Also ideal as the back-end of a headless eCommerce solution for businesses that already have a good quality website front-end.
Shopify have 3 plan levels as well as bespoke arrangements for large enterprises. They have a great reputation for their 24-hour international customer support.
WooCommerce is an eCommerce platform plugin for WordPress and is owned by the same company which means there is a very tight integration. Ideal for small to medium size product catalogues. The plugin is free and offers strong product features including categories, SKUs, regular and sale pricing, customer feedback and ratings and more. There’s a great checkout and cart experience and order management, customer management and reporting, sales optimisation and cost calculation included the free version.
The product allows users to sell both physical as well as digital goods online. WooCommerce features shipping cost and sales tax management, which allows users to calculate taxes based on sales volumes and local tax regulations. It also allows users to manage different shipping methods, such as pickup, local delivery and shipping services.
Support is limited to a fairly comprehensive knowledge base, an online forum, FAQs and video tutorial support options for user. While there is no phone support they do have a ticket system to manage customer enquiries.
For payment processing, WooCommerce integrates seamlessly with 3rd-party payment gateways including PayPal, Stripe, eWay, PinPayments and more (transaction fees apply).
The free version of WooCommerce may offer enough functionality for many online stores but for extra functionality there are a range of extensions available. These include subscriptions, bookings, product addons, checkout field editor, dynamic pricing and more. If your business requires extra functionality it’s recommended to price these from the outset as they could start to mount up over time.
Recommended for businesses already using WordPress or sites not using a Content Management System (CMS) who want to achieve a tightly integrated solution for their business brand and online sales.
If you are already using Wix for your website and only have a few products to offer then upgrading your hosting to a premium plan to add Wix Store may be a good option.
They have a wide collection of good-looking templates, although you can’t switch themes after choosing your original one. There’s a built-in drag-and-drop store builder which requires no coding experience. You can add product image galleries with “Buy” buttons. The page editor takes a little time to get used to but changes can be previewed without publishing allowing you to get things just how you want them. There is a switch to Mobile editor view where you see what your store looks like on a smartphone and you can rearrange things independently.
Wix have an internal App Store which includes an appointment scheduling tool (Wix Bookings), event management app (Wix Events), hospitality widgets (Wix Restaurants and Wix Hotels). These are proprietary software apps rather than 3rd-party plugins available in WordPress.
eCommerce factors such as payment processing, coupons, global shipping, taxes, secure shopping cart an order tracking are well handled. Wix have 3 Business & eCommerce plan levels to suit businesses of different needs and size.
Recommended for businesses already using Wix and with only a small catalogue of products and not looking for scalability over time. Take your time picking a theme as you can’t change it down the track.
BigCommerce, like Shopify offers a good range of themes and templates to make sure stores look professional and get up-and-running fast. Alternatively, you can design your own store from scratch or pay BigCommerce for a bespoke design. The platform incorporates a full-featured Content Management System that allows you to run an entire website, not just your online store.
There’s flexible product management with unlimited variants, SEO optimisation and range of fully integrated marketing tools, reporting and analytics. Online payments can be accepted via 40+ pre-integrated payment gateways and shipping details can be customised as per your local requirements.
BigCommerce make it easy to replatform from any other eCommerce solution, and have migrated over 20,000 so far. They have a bulk product import/export facility and offer support from their team to transfer from another platform.
Big Commerce do not charge transaction fees over and above those of their wide range of 3rd party payment gateways. These include PayPal, Braintree, Stripe, Square and some Australian based choices such as eWay and PinPayments.
They also have a WordPress plugin that is expected to make a major impact in 2019 as it will seriously challenge the WooCommerce dominance on that platform.
Recommended for businesses who don’t have an online presence yet and are looking for a website focussing on online sales. Good option as the back-end of a headless eCommerce solution for businesses that already have a good quality website front-end.
BigCommerce has 4 Plan levels to cater for all types and sizes of businesses. It’s important to understand that the plans will automatically scale-up when certain revenue thresholds are reached.
- Best for large-scale enterprises.
- Easy to set-up, feature-rich, extensible.
- Proven customer support
- Can be costly
- Needs a professional developer
- Not for beginners
- Easy to set-up, feature-rich, extensible
- Mobile friendly out of the box
- Proven customer support
- Not so easy to customise
- Not for blogging, extra pages
- Very cost-effective for basic functionality
- Easy to set up especially for those used to WordPress
- Great for SEO optimisation
- Dependent on WordPress
- Can be costly if add on functionality is required
- No phone support so relies on developer assistance
- Easy to set up and use
- Plenty of design options
- Great for SEO and marketing
- Upscaling of pricing punishes successful businesses
- Mixed feedback from users about support
Whatever you decide remember:
- Security considerations come first. Ensure your site is HTTPS by installing an SSL (Secure Socket Layer) certificate.
- Budget for ongoing updating and management.
- Ensure your website enhances your brand and offers a pleasant user experience.
- Pay for professional web hosting to ensure your site is always available and runs fast.
- Pay for professional web developer to help get things set up. They will show you how to manage your online store and maybe even offer to manage the technical side for you so you can concentrate on what you do best.
- Make sure you are happy with the design and usability of the checkout and shopping cart.
- Budget for customer questions and after sales service.
- Take advantage of your existing social media presence.
- Don’t think that you need to load your full catalogue on launch day. Add products as you go and remove poor-performing products at the same time.