This post is going to be more about me discussing some issues I find important in the Australian eCommerce realm, as well as sharing news that Kiehl’s has recently opened up their first Australian eCommerce store and a notes I wanted to point out.
As you guys may or may not know, during the day I work in IT. More specifically I work in eCommerce, an industry I absolutely love being a part of 🙂 Unfortunately it’s an industry that has been the focus of a lot of negative media attention lately and naturally is something I am very close to.
In recent years, Australian retailers have been slowly losing ground to their overseas competitors, no surprise there as I’m sure most people reading this blog post have only contributed to this figure, I know I have.
Our local retailer’s reaction to this? Absolutely appalling, instead of working towards helping and providing to their consumers, they are instead fighting to have pointless regulations put in place to only alienate themselves further from the Australian consumer.
Australian retailers need to recognise that times have changed and respond accordingly. According to surveys the main reasons people choose to shop online are:
• Cheaper prices
• Larger range
• Ability to browse online / compare prices
• Enticing offers / free shipping
• Personalised experience
The term, “You attract more bees with honey than vinegar” couldn’t be truer for local retailers. The one thing they have that many online overseas competitors don’t have is they are physically here.
Not only could they be addressing all the issues above, they could be using their brick and mortar stores to their advantage. They need to lower prices, set up online counterparts, branch into the mobile and tablet market and provide consumers a multi-channel experience.
Only local brands will be able to allow consumers to do things like place an order whilst on the train home from work on their mobiles and pick up in store that evening, and many more. Local retailers are able to more closely interact with their consumers, they really need to take advantage of this!
One company who I think is a great example of this, and is currently leading the “fight” against overseas competitors is Kiehl’s.
About a month or so ago, they dropped their prices to be competitive with those in America. Keeping in mind that their prices do not match their American counterparts, BUT they’ve priced themselves in such a way that if you were to include shipping & fees to order from America, you’d pretty much be a little better off to just order here (or would be pretty much breaking even). A smart and strategic move on their behalf.
The other thing they’ve recently done is join the online market! You would not believe how many Australian companies in 2011 still do not have an online store, talk about living in the stone ages. So much valuable time and money wasted!
But not only have they gone online with their discounted prices, they’ve been sure to bring across the same marketing strategies used in America, such as:
• Free samples with every order
• Free shipping for the month of June
• Free gift with purchase (lip gloss) if you enter the promotional code lipglossblog upon checkout.
With a set up like that, I could not be bothered ordering their products overseas anymore, I’d go straight to the Australian website instead.
Kiehl’s certainly took a step in the right direction, and have as a result created a warm buzz for their branding locally. Their consumers view them fondly, rather than how consumers now see Harvey Norman *rage*.
So long as they continues this trend by improving their local product range, continue providing fantastic offers and eventually branch out into the mobile / tablet market, I can see them being one of the leaders in the Australian retail market, and I wish many of the larger retailers would follow in kind.
I completely agree with you Celina! Kiehl’s is doing an amazing job and those regulations that local retailers are pushing for are completely ridiculous and a total suppression of consumer rights! Love your post for pointing out these issues!
So glad you agree! 🙂 Retailers either listen to what we’re saying, or they can stand to lose out to the impending overseas invasion. Many massive overseas retailers can see the lack of competition in Australia, and I’m happy for them to spill in if local retailers refuse to listen.
PREACH IT.
w00t w00t!
Excellent post and so true. Australian retailers have a lot of work to do, if they want to make things work.
<3 <3 Indeed they do, and they better work on it whilst they still have the capital, cause once they start to lose even more ground to overseas, it may be too late.
This just thrills me to bits, because Kiehl’s is such a wonderful brand and their skincare is topnotch- it’s only right that their service is too!
I’m glad they’re making the effort to embrace their local market despite them coming from abroad. It makes consumers breathe a big sigh of relief.
Thanks for the update Celina!
My pleasure Annie! Kiehl’s is one of my favourite skin care brands 😀 I’m so happy I get buy it anytime, anywhere now! 😀
YES to all of this!!! I was just in a seminar yesterday that discussed these very things. They really need to look at the successes that similar businesses are having overseas to see that they could have been using the online market to their advantage. They don’t have to make the consumer the enemy.
The wasted opportunities just baffle me, serisouly.
Go Kiehls!
It’s almost like our local retailers want to fail, the answer is so obvious, I just don’t understand why building a strong multi-channel online presents isn’t top priority to them. Building more brick and mortar stores is pointless given how much they are losing on their existing ones :/
Fantastic article. All the Aussie retailers are doing is pushing consumers away and drawing more publicity for online stores. Online shopping for me is a godsend because I work such unusual hours and live quite far from the city of Perth, it is so much more convenient for me to order online and have products dropped off right at my door. I think a lot of West Aussies would agree because we are quite sprawled out it is a pain to drive to the city, park, pay for parking, get treated rudely by sales staff then have to lug everything back home. No thanks I’d much rather shop from the comfort of my own home when I’m looking for my makeup fix!
Truer words could not be said! There are still some big retailers planning to spend millions of a bunch of new Brick and Mortar stores in Australia, and whinge that investing into an online store is not worth it or too expensive. Please! Where are their priorities?? The answer is painfully obvious, too bad by the time these companies realise that, it may be too late to recover.
I couldn’t have said it better myself, I wish every whinging Australian retailer would read this! When I saw them complaining on the news that people shop online to bypass GST I was *infuriated* – I couldn’t give a crap about GST, if they weren’t charging extortionate prices I wouldn’t HAVE to shop online. I wish some of these retailers *cough* Harvey Norman *cough* would just run themselves into the ground already >:|
Here here! I doubt any retailers would read my blog, but I’d gladly express my views and suggestions in great detail if they would!
excellent post! only if australian retailers read this instead whining and trying to do something driving people away from them.
aus post should do also something about their fees as well to reduce shipping cost.
100% agree, if AusPost insist of charging such high rates, then maybe they should up the service and stop losing packages -_-;
Fantastic post, Celina and I could not agree more. If Australian retailers offer similar prices, I’d definitely prefer to shop local. Fact is, they just don’t. Consumers will obviously go where they get the most value out of their hard earned money. Kiehls is definitely ahead of the game here and going in the right direction! 🙂
Thanks so much Nadia, it’s a topic very close to my heart and career and I’ve so glad so many others agree with me 😀
I really enjoyed reading this and couldn’t agree more.
Thank you so much <3 🙂
This is a fantastic post. It’s something that has made me facepalm and say “Really? REALLY?!?” a lot, namely the attitude that local shops are doing us a FAVOUR by providing us with substandard service, limited range and higher prices. And somehow we’re obliged to buy from them… why?
I prefer to try makeup before I buy, but given the attitude I’ve mentioned above, combined with just lack of range, etc, I’ll chance online. Until they learn their lesson.
Absolutely! The basics of any economy is supply and demand, if they won’t supply what we want, the demand will disappear and so will their profit margins.