Unwrapping the gift of online shopping this Christmas

THIS SEASON, the Australian Retailers Association (ARA) and Roy Morgan predict Australians will spend in excess of $51 billion over the pre-Christmas trading period from November 9 to December 25, 2018, with the ARA anticipating that online shopping will a popular preference for consumers this Christmas.

The ARA and Roy Morgan estimate Aussie consumers will spend over $7.3 billion in the ‘Other Retailing’ category this festive season, representing a 2.7 percent jump compared to the previous year.

Russell Zimmerman, executive director of the ARA, said the ARA’s collective research from our partners at Neto and Hitwise indicate a gravitational shift towards shoppers turning to online platforms to hunt for the perfect gifts.

“Christmas is fast-becoming the most opportune season for shoppers to purchase gifts online, with online platforms offering convenience and a range of delivery options in the 24-hour marketplace,” Mr Zimmerman said.

“Online shopping accounts for over $23 billion annually in Australia, and the ARA and Neto expect even more consumers to use online platforms to get in early and avoid the rush that occurs in the lead up to Christmas.”

While Boxing Day reigns supreme as the most favourable sales day over the holiday shopping season, newer sales days including Black Friday and Cyber Monday are on the incline, with recent data from Hitwise indicating a 20 percent year-on-year increase from the previous year. The ARA believes these sales days will encourage retailers to prepare for the upcoming festive season.

“This year, we will again see Black Friday and Cyber Monday kicking off the pre-Christmas sales, and the ARA predicts these sales days will encourage retailers to prepare for the upcoming pre-Christmas scramble that occurs during the busy trading period,” Mr Zimmerman said.

With Deloitte’s Retailers’ Christmas Survey 2018, highlighting that 79 percent of local retailers forecast online sales to increase by 10 percent or more over the Christmas period, the ARA believes there are strong indications that online sales growth will be a significant contributing factor to retailer success this Christmas.

Ryan Murtagh, Founder and CEO of Neto, said Neto’s latest State of E-Commerce Report cited substantial growth in online gifting this year, with the average basket size increasing to $130, a 5 percent increase from the previous year.

“Over the last year, online retailing has experienced a 30 percent increase in sales compared to 2017, with fashion boasting the highest growth in sales with a 57 percent increase year-on-year. Homewares and Electronics follow closely behind with 13 percent average monthly sales increase across each category,” Mr Murtagh said.

The report also highlighted alternative payment options have recorded a 122 percent year-on-year increase compared to 2017, with many merchants adopting buy-now, pay-later services including Afterpay and ZipPay.

Mr Zimmerman said retailers who adopted these services will possess a significant advantage during the Christmas trading period this year.

“With a diverse range of viable payment options on offer from Buy Now, Pay Later services on the rise, merchants who offer these services to their consumers will reap the rewards of pre-Christmas sales,” Mr Zimmerman said.

“As the ARA already anticipate online retail sales to continue to increase immensely during this season, it seems likely that transactions through buy-now, pay-later services will contribute to this increase throughout the Christmas season and into the New Year.”

ARA Roy Morgan Pre-Christmas Sales Predictions: November 9 – December 24, 2018

2018 Pre-Christmas Sales Growth by Category

State	2017 Pre-Christmas actual results ($mil)	2018 Forecast Pre-Christmas sales ($mil)	Predicted Growth
FOOD	20163	20908	3.7%
HH GOODS	8757	8931	2.0%
APPAREL	3906	4028	3.1%
DEPARTMENT STORES	2935	2943	0.3%
OTHER	7127	7321	2.7%
HOSPITALITY	7117	7348	3.2%
NATIONAL	50005	51479	2.9%

[ARA / ROY MORGAN]

 

2018 Pre-Christmas Sales Growth by State

State	2017 Pre-Christmas actual results ($mil)	2018 Forecast Pre-Christmas sales ($mil)	Predicted Growth
NSW	16132	16629	3.1%
VIC	12843	13512	5.2%
QLD	9907	10071	1.7%
SA	3320	3422	3.1%
WA	5395	5366	-0.5%
TAS	998	1038	4.0%
NT	495	501	1.2%
ACT	914	940	2.9%
NATIONAL	50005	51479	2.9%

[ARA / ROY MORGAN]

For more information on Christmas predictions and to keep up to date, visit https://www.retail.org.au/christmas-predictions/

Follow the links to view Neto’s 2018 State of E-Commerce Report and Hitwise’s Top Trends To Think About This Holiday Season  and the Deloitte Retailers’ Christmas Survey 2018.

www.retail.org.au

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