Finance Online v in-store shopping: Australians want ‘best of both worlds’

Online v in-store shopping: Australians want ‘best of both worlds’

Online shopping
Australian consumers aren't likely to give up on in-store shopping anytime soon. Photo: TND/Getty
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Retailers with brick-and-mortar stores were the biggest winners from the online shopping boom during the pandemic.

Data released by Monash Business School’s Australian Consumer and Retail Studies (ACRS) shows 64 per cent of Australians who shopped online over the past three months did so on the websites of retailers with physical shops as opposed to online-only retailers.

The findings suggest online shoppers prefer to buy from businesses with a physical presence, rather than stores that operate entirely online.

And they support earlier data from the ABS, which shows online sales for ‘multi-channel’ retailers accounted for 7 per cent of total retail sales in October 2020, compared to 3.3 per cent for online-only retailers.

Queensland University of Technology professor and retail expert Gary Mortimer said the data showed physical retail “isn’t dead”.

Shoppers fall back on what they know

Dr Mortimer said shoppers turn to the online stores of retailers they know and trust.

“In most cases, you’ve probably had some experience with a physical retailer,” he said.

“Whether it’s a supermarket or a discount department store, you’ve shopped there over many years.

“You’ve developed a level of trust with that brand.”

Dr Mortimer also said having a physical store makes retailers seem more accountable if something goes wrong.

Online retailers usually have a communication channel for customers, such as a web chat option, but being able to walk into a store and talk to somebody face to face is a more “trustworthy” way to shop, he said.

ACRS principal research consultant and report author Stephanie Atto said physical retailers have “always reigned supreme” in Australia.

This is why people forced to shop online for the first time during COVID-19 lockdowns sought out companies they already knew, she said.

Ms Atto said the ACRS research also shows older consumers, and consumers who had never shopped online before, were more satisfied than younger people with online shopping during the pandemic.

This was down to younger people having higher expectations for online services because they spend more time online than older generations.

Ms Atto said older consumers were keen to continue shopping online as well as in store.

What the future of shopping in Australia looks like

As pandemic restrictions wind down, Ms Atto said online and brick-and-mortar stores are on an equal footing in the preferences of shoppers.

ACRS data shows half of Australians prefer shopping at physical stores, and half prefer shopping online.

Ms Atto said consumers “want the best of both worlds” and are seeking a “seamless” fusion of in-store and online services from retailers.

In particular, she pointed to how Australian clothing brand Cue offers in-store stylists for online shoppers.

“[That is] really great … to offer those humanised and personal touches, because customers still want to know that [retailers] care,” she said.

“Consumers want to know that when they go to [a] website, they’re going to have a similar experience to being in store.”

A retailer’s website imagery, whether it offers free shipping, and the option of refunds and returns all contribute to the seamless omnichannel experience consumers are seeking, Ms Atto said.

Dr Mortimer expects the growth in online shopping to “subside” in the next couple of years, but reckons online shopping habits formed during the pandemic are here to stay.

“I think once you’ve established an online account [and your payment and delivery] details, online shopping becomes quite a habitual transaction,” he said.

But Australian shoppers still place a lot of “social and … recreational value” on shopping in person, especially during the holiday season.

“At this time of the year, there’s a bit of tradition and ritualism around shopping at Christmas time, listening to the Christmas carols, and battling with the crowds occasionally,” he said.

“We might still like to utilise click and collect [to] avoid delivery charges. But, ultimately, I don’t think physical retail is dead.”