$63 billion online spend: Australian basket sizes shrink but purchase frequency up

The average value of an online shopping basket fell in 2023, but spending is still clustered around the magic $100 ‘free shipping’ mark, according to e-commerce data from Australia Post.

The delivery and postage giant released its fourth annual e-commerce spending report on Monday, exposing how volatile economic conditions influenced spending online.

All told, households spent $63.6 billion online in the past year, Australia Post said.

Other key findings include an increase in spending frequency coupled with an overall downturn in basket values.

One in seven households now makes an online purchase each week.

That is close to 2021 levels when COVID-19 restrictions limited access to many bricks-and-mortar retailers.

But the average basket size was $98.10 in 2023, Australia Post says, a fall of 4.6% from the year prior.

A closer look at the data reveals exactly who cut back the size of their online orders.

Gen Z shoppers cut back their online spending by 11% in 2023, contributing a total of $10.6 billion to the overall e-commerce market.

Their average basket size fell 6% to $80.

Each older cohort — gen Y, gen X, and the baby boomer generation — contributed more to total online spending.

Their average basket sizes also shrunk between 6% and 3%, but their average basket values remained clustered around $100, the threshold at which many e-commerce brands offer free shipping and other enticements.

While the $100 mark remains the gold standard for many brands, Australia Post reported a broad upward shift: some 43% of Australian retailers increased the ‘free shipping’ threshold in 2023, as the cost of postage soared.

Beyond data showing the increasing frequency of small online orders, the Australia Post data also showcases the monstrous success of sales events like Black Friday and Cyber Monday.

Sales volumes across each event grew 88% and 70%, respectively, compared to 2019.

“Retailers were quick to capitalise, extending sales periods and increasing promotions to capture a larger cohort of shoppers holding out for sales events,” said Australia Post group chief executive Paul Graham.

“All of this contributed to Australia Post achieving its biggest eCommerce Peak period yet delivering nearly 100 million parcels in November and December.”

You can access the full Australia Post report here.