Home Articles Australian retail websites lack sizzle, lose customers to more polished overseas sites

Australian retail websites lack sizzle, lose customers to more polished overseas sites


I scoured the shelves of my local supermarket on the hunt for light globes the other week. They didn’t have what I was after, so I jumped in my car and headed to a different supermarket — still no luck. On a mission, I headed to a third supermarket — same deal. Eventually, I left empty-handed and somewhat defeated. Staff at the supermarkets didn’t know what I was looking for. They didn’t ask, and I didn’t bother trying to find someone to explain.

I’m not alone. Every day, consumers come and go from shops, unable to find what they want. And retailers can’t capture data on these largely anonymous shoppers so they lose the sale – and don’t even know why.

But online retailers are immune to such problems experienced by their bricks and mortar cousins. Spend enough on technology and, with a few clicks, you can learn how a consumer came to your site, how long they browsed your virtual shelves and, most importantly, whether someone like me left with the light globes they came for.

But most Australian retailers with ecommerce sites are clueless about just how much valuable information they can capture about consumers. And they’re losing out as a result. Armed with this level of detail, you can monitor buying patterns and control stock levels. Marketing becomes easier. And you can upgrade your site to reflect consumer tastes.

Unfortunately, it comes down to money. Tight-fisted retailers aren’t forking out enough in the initial online development stage to turn consumers onto their brand – and this under-capitalisation is creating a virtual world of beige. Look around – so many ecommerce sites look strikingly similar to their competitors’.

Retailers need to be prepared for an initial investment of $100,000 or more to build an ecommerce site that will stack up against the best of the bunch. Don’t sound so shocked. Retailers think nothing of forking out several hundred thousand dollars on establishing a new bricks and mortar store – yet somehow presume ecommerce sites can run on the smell of an oily rag.

The investment is worth it. Australians spent $23 billion shopping online in 2008, but that figure is expected to skyrocket to $32 billion by 2012 – growing nine percent per year.

But sales could be far higher. UK and US ecommerce sites rake in seven to eight percent of all retail sales there, compared to just three percent of all retail sales in Australia.

It’s easy to see why. With the odd exception, Australian retailers have rushed to erect haphazard ecommerce sites that are sterile, clinical and communicate nothing about their brand. Most lack a merchandising strategy. Several insist that consumers hand over all their personal information before purchases can be made; turning consumers off in the process. Shoppers don’t care if your site records what they bought from you last time – they only care about this purchase.

Consumers also need to feel secure shopping on your site. And you’ve got to be transparent. Make sure consumers know what your delivery costs are up-front, before they start the transaction.

So often, the virtual shopping funnel doesn’t give consumers a memorable experience or tell them everything they need to know about your products. Remember, there isn’t someone greeting your customer at the front door of your virtual store, pointing out where the light globes are. But with the help of technology, there practically could be.

Australian retailers ignore this advice at their peril. Frustrated consumers are voting with their mice, with huge numbers choosing to spend their hard-earned cash on overseas sites that give them a far more enjoyable shopping experience. Last year, 43 percent of total online spend went overseas. No wonder brands based in the UK and US dominate the top 10 retail sites visited by Australian shoppers.

This should be serious cause for concern. Given that retail sales are up six percent compared with the same time last year (according to ABS figures), there’s serious money to be made online, so retailers can’t afford not to get their ecommerce strategy spot on.

And those retailers smart enough to fork out on their ecommerce site to ensure that it offers more than just a cold, heartless transaction will be onto a winner. Those brave enough to bite the bullet here in Australia will be duly rewarded.

Peter Noble is the CEO of digital marketing agency Citrus.

Photo: billaday