Tuesday, June 18, 2024

Research shows Australian retailers completely unprepared for Amazon

Digital marketing agency, DataSauce, has released the results from a recent survey that shows the vast majority of Australian retailers are completely unprepared for retail juggernaut Amazon’s arrival in Australia.

DataSauce says that Amazon is the world’s biggest retailer and it is currently preparing to take the Australian market by storm, hiring more than 100 people for roles in logistics, IT and security.

The results are worrying, showing that while 90 percent of survey respondents knew that Amazon was coming to Australia, less than half (48 per cent) knew about the Amazon Prime offering – a premium service that offers customers fast shipping options for free.

According to DataSauce, Amazon Prime will be a game changer for Australia.

“It enables customers to pay an annual fee of about $100 for free and fast delivery,” DataSource founder Tzvi Balbin. “About 60 million US households have signed up for the Amazon Prime service. Amazon also offers a service called Amazon Now, which promises to deliver products such as groceries in under an hour. Both of these premium services have the potential to blindside the efforts of Australian retailers

“The Amazon Prime offering is more advanced than almost any of the services offered by retailers in Australia. This means that even those who have upped the ante with quicker delivery times may still struggle to compete with this service and match the level of investment.”

During a recent trip to the US, Balbin himself trialled Amazon Prime and says that the sheer ease and speed of service have the potential to derail totally a number of Australian retailers.

“Amazon Prime in particular could be a game changer in the Australian retail space,” he said. “For many retailers, trying to compete with one or two-day delivery and free shipping may prove too much.

“You’ve also got to look at how omni-channel your business is, so the shopping experience is seamless. A number of physical retail outlets are optimising their customer experience so it’s seamless offline and online. It’s not enough to have in-store pickup and claim to provide a true omni-channel experience.

“At the end of the day, to beat Amazon, you need to focus on their weaknesses. Niche down, build and nurture a fanatical community, tell a story and leverage loyalty. After all, Amazon is a one size fits all.”

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