Big W opens online store, but US sites still dominate Australian e-tail

Retail giant Big W will now offer part of its catalogue online in order to appeal to rural and time-poor customers, in a move the company says will add sales and appeal to a market which is becoming more accustomed to online retail.

However, the move could be a late-game attempt to recapture Australian customers from international competitors, with one industry expert saying at least half of online spending is being sent overseas due to a lack of local options.

The move online for bigger department stores is inevitable, one retail expert says, as the bigger players begin to offer products online in order to gain as many sales as possible and beat out the American rivals.

Big W announced the move late yesterday, saying it will offer over 4,000 items from its catalogue on the site, which will be open 24 hours a day.

Additionally, in a move it believes will push forward the concept of online retailing in Australia, Big W will offer next-day shipping and the introduction of an online customer service assistant program.

Some experts have said the take-up of online retailing in Australia has been particularly slow due to a number of missing features from retailers’ websites, such as next-day or priority shipping, which is a staple for many American eCommerce sites such as Amazon.

Director of Big W, Julie Coates, says the site will help people be able to “shop when they want, where they want and how they want”.

“Many Australian consumers are already confident online shoppers. The easy to use and simple to navigate nature of this site means that experts and new online shoppers alike can now research and buy quality items for themselves, their home and their family at everyday low prices,” Coates said.

“This is great news for Australians living in rural and regional areas who can’t easily travel to a Big W store. It’s not just about extending our range online, it’s about extending our reach to all Australians.”

Larger retailers in Australia have been hesitant to move online, and have traditionally viewed websites as a place where consumers go to research, but not purchase. The latest trend has seen some larger retailers, such as David Jones, dip their toes into the water with some simple offerings to determine how a larger online shop front would work.

Additionally, some retailers are attempting to catch up to some of the more successful retailers, such as Dick Smith and JB Hi-Fi.

However, it could also be an attempt to block American retailers from dominating the market. Online Retailer Expo & Conference managing director Mark Harvey has said in a new survey that over 50% of Australian dollars spent online are going overseas, with American retailers now an active threat to local commerce.

According to Forrester Research, online spending is expected grow to $32 billion by 2012, indicating that billions are being sent overseas due to a lack of online options in Australia.

Additionally, the survey claims 36.8% of web retailers in the US view Australia as one of their top three markets for international business. Many did not even offer functions for international shoppers, such as designated shipping rates and information for buyers, Harvey said.

“A whole new generation of consumers have taken control and are changing the game for the retail industry,” he said in a statement. “With access to a wealth of information online, customers are speaking to us loud and clear by putting their credit cards on the line and transacting.”

Harvey said this is because American retailers have offered low prices, particularly when contrasted against the Australian dollar, and usually offer quite reasonable shipping times.

Chief executive of consultancy group Retail Doctor, Brian Walker, says Australian retailers will continue to miss out on more sales unless they begin to at least offer information for buyers online about what products they can buy in-store. Ideally, he says, products should be available for purchase online.

“When you see that over 60% of the population go online to research bigger ticket items, across all age groups, it is inevitable that these larger retailers will start to go online. By not going online it is limiting their capacity to sell.”

Walker points to electronics retailer Dick Smith as a model to duplicate, saying it makes the best of both worlds by opening bricks-and-mortar stores along with a comprehensive online option. Dick Smith consistently ranks as one Australia’s top online retailers.

“Retailers must be offering multi-channel retailing. Dick Smith is a technical offering, so while it is already attracting a fairly internet-savvy audience, the site gives good group data, and they have great distribution and supply-side logistics. They are offering through both channels in a very good way.”

“These retailers cannot afford not to go online. The opportunity when they do is huge, there is a huge range out there, and the fact David Jones is going into this shows that. There needs to be a good range of products for the offering to be viable.”