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Aussie ecommerce Facts & Stats

Alright people! I have few numbers for you to crunch and establish a link between your business and your “new” favourite customers. These numerics have been taken from a NAB report (for 2012) to indicate how aussies are choosing to shop and spend.

So firstly, the online retail has picked up again after falling a little around late 2011, but still has a long way to go. In 2012;

Online sales grew 26% – 12.3billion

Traditional or non-online sales grew only 2.6% – 221billion

This shows we need that NBN thingy up and running now and not in the next ten years (by which time we will all be ancient history).

But this also means that there is a lot of space for small businesses to grow online and capture more attention and market.

 

 

The next 2012 stat might make you a little happy – domestic retailers are outselling international ones. Domestic retailers contributed to 74% of total online sales. Damn that sounds sexy!

Domestic retail sales growth – 28%

International retail sales growth – 22%

This also suggests that mentioning that you are an aussie owned and operated company, might get you the intial sales you need.

 

Now I don’t want to sound condescending here, but older people have caught up with us (young ones) in terms of online spending. People in their 30’s and 40’s are the ones driving growth in online retail. Its an important demographic of your target audience and should be addressed accordingly.

 

Moving on to geographics. Off course, NSW and Victoria are still the two highest contributing states to online retail (76%) in terms of number of customers and subsequent spending. But its WA and NT that are showing the most growth and a swift one as well (36%). And once again the people in their 30’s, 40’s and 50’s are the ones leading the charge in these states.

Although it is worthwhile considering that the growth in WA might be linked with the mining boom, but with many claiming the mining boom to be over, we might see some considerable changes in these figures in 2013.

So for now, if the delivery/postage section on your website or any form of your business says “please allow few extra days for delivery to regional areas”, you might be losing some very important customers.

 

The report further classifies some markets according to sectors:

Sector one – online auctions, department stores, fashion, cosmetics and variety stores;

Sector two – home, furniture, appliances and electronics;

Sector three – recreation, toys, games and hobbies, music, movies and books; and

Sector four – groceries, liquor and specialised food

 

Apart from sector 2, every sector showed a consistent growth. Sector 2 mainly consists of white goods that people are mostly happy to buy in retail stores to get a good touch and feel. Besides, its getting very hard to create profit margins with electronics due to the enormous rise in competition both locally and internationally. You ought to have a very distinctive/creative product to achieve high margins (like dyson).

Lastly, under 30’s (like us) are spending more time with sectors 1 & 3 (ebay, gaming consoles, amazon & the list goes on) whereas older people spend more time with sector 4 (buying the everyday necessities like alcohol).

 

These demographics are very important in categorizing the target market of our business and should be incorporated into the marketing strategy.

I will try and have some international infographics for my next blog entry.

In the meantime, I would love to know your comments!

Alibaba & too many thieves!!

I am sure a lot of us are in the midst of starting a business or researching for new ideas. In either case, for people who are focussed on a product based business, Alibaba has a good list of genuine wholesalers (free of cost). Unfortunately, its equally a good space for scammers and fake businesses. This is one of the reasons why people prefer to deal with worldwide brands and eSources (where you off course have to pay for membership).

But having mentioned the above, I must also admit that Alibaba has measures in place to protect buyers. There are quite a number of ways/practices that can ensure a good experience at Alibaba (should you choose to adopt these). Please check out their videos on youtube that are very helpful as well.

(I have mentioned in my previous blogs about Aliexpress, which is part of Alibaba but has better security and extra advantages).

 

So, it all starts with the most asked and wondered question “Which supplier”?? This is the first question that you would want to look up if there was a Wikipedia article on it (don’t worry, I already checked, there isn’t one). Choosing a supplier depends completely on your needs. First of all, how big is your order going to be, aka, what is the quantity that you are looking to buy? Is it going to be a one off order? Are you going to order at fixed time intervals throughout the year? What kind of variations such as aesthetics, do you need? Quantity will decide the price and the suppliers, since most have a threshold amount under which they don’t take orders.

Next filter is Alibaba’s ranking system which comes up in two categories; number of years registered and if they are verified or not. Number of years wouldn’t matter as much as being verified would. Verified businesses are the ones whose operations and locations have been physically checked by alibaba personnel to give them the label of “Verified Supplier”.

This article is going to go on, so please grab a coffee or mother or some sort of energy drink so you don’t fall asleep.

The next thing is to browse through suppliers and compare the products versus their offered price range. This is the main research and could seem like a long process but is the most important one….so don’t give up. Good things come to those who research….hmm I made that up but sounds cool, doesn’t it.

Anyway, also keep an eye on “methods of payment” that each supplier is providing and choose the one you are most comfortable with. I would recommend using paypal only, since it’s the safest. In case of a fraud where you paid and didn’t get the products, you can request a refund from paypal or from your credit card provider (such as mastercard, visa,etc). This process is called ‘chargeback’. You can find more information on Wikipedia. (Yes, I checked and there is an article on this one).

Moving on, the next problem most people face is – Am I going to get exactly the same product as has been shown in the picture on their website and would the quality be up to the mark?? The best way to encounter this problem is by ordering a sample from the suppliers you are interested in. You can’t order from 50 different suppliers, so narrow the list down to only your favourites.

NOTE: You can also ask for photos of the packed product or the photos when the product is ready to be shipped, just to confirm if the supplier is experienced enough and is not a middle man or agent.

The last but one of the most important things is going to be delivery time frame. Mostly you can assume that the cheapest way would be through sea, but it can take up to 8 weeks to receive the shipment (you would be a dinosaur by then). But since this is an important aspect of your cost, it’s worth speaking about with the suppliers, from the very start.

I should also mention that you can post a buying request on Alibaba. It’s an ad that you put out within alibaba that allows you to list your requirements so only interested suppliers contact you….like a dating site, except you don’t need a picture to get a response.

Hypothetically, you might leave out some good suppliers because you maybe too focussed on the ones that are contacting you. So, its good to look on your own whilst the responses to your “buying request” are giving you good insights into your chosen product industry.

In retrospective, I feel like I should have done a video blog instead of writing so much… Anyway, I hope I have helped you in some way or the other.

Would love to hear your comments!!