E-commerce soars in Australia & NZ amid rising data concerns

Online shopping has become a significant part of the retail landscape in Australia and New Zealand, according to the Australian and New Zealand Ecommerce Report 2024 released by IAB Australia and Pureprofile. The report indicates that 83% of Australian online shoppers and 77% of New Zealand online shoppers make online purchases monthly.

The report highlights that value-seeking is a primary driver for online shopping, with a notable increase in consumers prioritising lower prices and discounts. In total, 62% of shoppers have switched products and brands to find cheaper alternatives.

Consumers are utilising various price and product discovery methods to ensure they receive the best value. While search engines remain the most utilised tool, 38% of shoppers are turning to price comparison sites and services, and 20% are using major shopping events for discounts and product discovery. Influencers and social media significantly impact the shopping habits of 58% of shoppers aged 18-29.

Convenience remains a crucial factor for online shopping, with 68% of respondents citing it as their primary reason for purchasing online. The report also notes that shopper loyalty and rewards programmes have gained importance, with 92% of online shoppers enrolled in at least one programme and 95% willing to share some data with retailers in exchange for benefits such as discounts, free delivery, and rewards points.

However, the report indicates a growing concern over data usage, with 71% of online shoppers worrying about how their data is used by retailers, up from 59% in 2023. More than 80% of online shoppers understand that their data is used for targeted advertising, marketing, and personalisation.

Gai Le Roy, CEO of IAB Australia, stated, “The increased importance of loyalty programmes for shoppers and retailers is underpinned by trust, transparency, and a clearly understood value exchange. It is critical that retail businesses ensure they are providing clear information about their use of shoppers' personal information, particularly with new privacy regulations in Australia imminent.”

Martin Filz, CEO of Pureprofile, commented on the findings, noting, "In a quest for savings, consumers are prioritising the best deals and frequently switching brands to secure a better price. While budgets are tighter, retailers still have a great opportunity to capture attention with most consumers still engaging with some form of retailer marketing."

The report identifies clothing, fashion, shoes (70%), groceries (58%), and meals and takeaway (56%) as the top three categories of products purchased online. Retailers are noted as a key source for product discovery, with 61% of online shoppers reading or looking at content produced and distributed by retailers, such as websites, emails, and social media posts.

Search engines are particularly important for product discovery among shoppers over 50 (71%), while social media plays a greater role for shoppers aged 18-29 (58%) and 30-39 (46%).

Additionally, the importance of price comparison, fast shipping, and free returns is rising among online shoppers. Ethical considerations are also noteworthy, with 46% of Australian and 39% of New Zealand online shoppers valuing purchases from ethical brands.

The report advises retailers to use discounting strategically as part of a more comprehensive marketing strategy that offers added value and relevant shopping experiences fitting the current economic climate. The research also underscores the significance of maintaining a presence across multiple advertising channels to ensure long-term business success.

The Australian and New Zealand Ecommerce Report 2024 is based on research conducted with 1,000 Australian and 1,000 New Zealand online shoppers during July 2024. It examines the consumer attitudes, behaviours, and influences driving e-commerce in the region.