The advance of internet technologies in the 21st century has changed the way business is conducted. With just a few clicks of the buttons, individuals can order products ranging from common household items to expensive electronic goods. The internet in a way has become a global marketplace that transcends boundaries allowing companies to offer goods to customers located anywhere in the world.
During the last few years, eCommerce has exploded in popularity in Australia. The country scores 4.5 on the Borderfree Index that offers attractive cross border market for online retailers. Demand for online consumer goods have been on the rise in the country due to increasing disposable incomes and low unemployment rates. Here we will take a look at some of the reasons Australia presents a gold mine for eCommerce start-up firms in earning above average profit on investment.
Limited Competition for Online Goods and Services
Unlike in other developed nations including the US and UK, Australian eCommerce landscape is marked with limited local competition and strong unions. This presents great opportunity for budding entrepreneurs to setup an online presence and earn great returns on investment.
Australian start-up eCommerce companies will not find great difficulty in capturing online market. With less competition, they do not have to keep the price too low to attract customers.
High Disposable Income and Low Unemployment
Australia has a population of 23 million with one of the lowest unemployment rates that stood at just 6.2% in August 2015. Australians on average are well aware of the digital technology. Around 40% of the population have connection to the internet. Despite having one of the highest penetration rates, a study conducted by Jupiter Research found eCommerce stores have yet to capitalize on the opportunities.
Only 12% of Internet users buy goods and services online, as compared to 40% in the US and 25% in Canada. eCommerce companies can act now to reach out to additional users and quickly grow its user base.
Multi Billion Dollar Market
The retail ecommerce landscape is expected to increase by 14.4% in 2015, according the an estimate of eMarketer research firm. Last year Australians spent around A$22.63 billion in online retails purchases. In that year the total retail sales increased by 4%. The trend is expected to continue this year as well with an increase of 4.5% in online retail sales.
The online eCommerce landscape in Australia at the moment is dominated by variety and department stores. There is great scope for new entrants to offer both B2C and B2B services in different sectors.
In conclusion, Australian market presents great opportunity for eCommerce business owners to earn above average return on investment. They need to focus on meeting to online user needs and sell value to the customers. This requires conducing online research to justify online offerings and selling quality products and services that exceeds expectations of the customers. Moreover, the online eCommerce stores need to align its marketing goals to ensure that it brings maximum ROI and profits.