With the impending arrival of Amazon in Australia, a new study has revealed how much strain the e-commerce company is likely to put on local online retailers: 90 per cent of Australian online shoppers think they will purchase from Amazon if it fulfils its promise to deliver low prices, vast selection and fast delivery.
The results come from an independent survey of 1,001 Australian adults who have shopped online at least three times in the last six months, commissioned by parcel delivery service CouriersPlease (CP).
The survey initially explored whether online shoppers currently prefer purchasing from retailers that specialise in a single category (such as fashion or technology) over online ‘marketplaces’, where they can shop across multiple categories from the same site. More respondents (58%) admitted they prefer to shop from a specialist online retailer than a marketplace (just 42% of respondents).
However, when told that Amazon in Australia will focus on providing low prices, vast selection, and fast delivery, 90 per cent of respondents said they would shop from Amazon.
The survey separated Amazon’s three focuses – prices, selection and delivery – to gauge what was more important for Australian shoppers. Lower prices is the main reason shoppers would purchase from Amazon: 68 per cent of respondents cited prices as the most common reason. A wider range of products is the second most common reason – important to 55 per cent of respondents – while just 30 per cent of respondents said fast delivery times is the reason.
Prices were more important for younger age groups than older generations. Millennials in their 20s and 30s cited lower prices as the main reason for shopping on Amazon, 71 per cent and 70 per cent respectively. This reduces with age, with 63 per cent of 50-somethings and 64 per cent of people over 60 years concerned about prices. Vast selection was more important for older generations than younger generations, with the level of importance decreasing with age. For people in their 50s, a wider range of product choice would be the reason 58 per cent would shop on Amazon, whereas this was only important to 46 per cent of people in their 20s.
Currently, 18 per cent of respondents said they purchase from Amazon and will continue to do so when it launches in Australia. Surprisingly, only 11 per cent of 20-somethings currently shop on Amazon, the lowest of any age group. This jumps up to 22 per cent of people in their 30s, 16 per cent of people in their 40s, and 19 per cent of over-50s.
Recently appointed COO of CP Hoy Yen Hooper said: “Amazon’s promises of lower prices and faster delivery times may put pressure on existing local retailers and the supply chain, but I believe we will become better at what we do. In the US and UK markets, where Amazon has a large share of the retail market, one-hour delivery through Amazon Prime and competitive prices are being offered. In our survey, fast delivery was the least important reason for shopping on Amazon, which may indicate that consumers in regional and country areas know that delivery may take longer as it is not commercially viable for many providers to have that sort of reach.
“Amazon will be attracted to delivery services that provide consumers with flexible delivery choices – such as enabling them to pick up at retail outlets such as newsagents, grocery stores and petrol stations – consistency in delivery, and reliability in keeping with expected delivery transit times. Consumers really value consistency and reliability: an item that is due to arrive within three days will arrive within three days 90 per cent of the time.”