What’s more, the online shopping boom is worth big bucks. This year, the online shopping market will be worth $16 billion, with that number ballooning out to $26.9 billion by 2016. Of this year’s $16 billion, $7.2 billion of that through international websites.
According to PwC, this ever-increasing shift towards online spend is forcing a rethink for retailers in how they do business. PwC Global Retail & Consumer Advisory Leader, Stuart Harker explains.
“Like retailers in the US and UK are doing, Australian retailers must fundamentally rethink their strategy, particularly in relation to their real estate and store portfolio. The days of growing by simply opening more stores are long gone.”
PwC National Digital Leader, John Riccio, explains that having the best digital presence is now just as important as retail location – if not more so.
“Adapting to the new retail environment means firstly re-evaluating the role and size of the store. These days for many retailers a number one ranking on Google is as important as a flagship store on Melbourne’s Bourke Street or Sydney’s Pitt Street Mall.
“The store will stay but it will continue to change, with retailers having to consider reducing store networks, cutting the size of in-store displays and subletting to other businesses, and in some cases converting under-performing stores into fulfilment centres for online channels.
“Retailers must also invest in better understanding the purchasing intent of their customers. This means recognising the role of price, online service and personalising offers based on an individual customer’s interests and broader ecosystem rather than purely buying history.
“Retailers need to be integrated across all their channels. No longer is the store the physical door that customers enter and leave from. Now your door is just as likely to be an e-commerce site, a mobile app, an interactive billboard, through a friend’s Facebook page or a video on YouTube.
“The retail industry is at a critical juncture and retail businesses that continue to operate in a traditional retail model run the risk of disruption and will not take full advantage of the opportunity that exists in this rapidly changing digital era.”