The Ecommerce Delivery Benchmark Report 2024, conducted by delivery technology company ShipStation and retail consultancy Retail Economics, has uncovered the changing dynamic of consumer behaviour across eight markets, including Australia. The study was conducted amongst 8,000 consumers and 800 merchants, revealing the increasing importance of physical touchpoints in the customer journey.
The research has brought to light that almost half (48%) - resulting in a stunning $15 billion - of Australian online non-food sales in 2023 interacted with physical touchpoints such as online browsing, in-store buying, click and collect, and in-store returns. This exposes a growing need for omnichannel strategies that integrate online and offline experiences seamlessly.
David Boyer, VP, Head of ANZ at Auctane, ShipStation's parent company, stated: "Today's informed consumer seamlessly navigates physical touchpoints like brick-and-mortar stores, social media discovery channels, and even embraces innovative solutions like AI-powered assistants. This omnichannel journey is not merely a matter of convenience, but rather an opportunity to forge personalised connections that build enduring brand loyalty."
A significant finding of the report shows that social media platforms like Instagram and TikTok are preferable to retail websites for product discovery, especially for Gen Z and Millennials. It was found that nearly 40% of digital natives (aged under 45) rely on social media for product research, compared to just 35% who use retail websites. This highlights the need for retailers to adapt their strategies to engage audiences on their preferred platforms.
The research also revealed the potential future role of Artificial Intelligence (AI) in the shopping experience. The study showed that although there is some hesitation, 31% of Australian consumers see the value of AI in streamlining order and delivery updates, and 28% believe it could simplify product research.
The findings also suggest that cost sensitivity remains essential for Australian consumers when shopping online, particularly when it comes to delivery. Around 48% stated the cost of delivery was the most crucial factor, with 71% less likely to shop with a brand because of high shipping costs and 44% unwilling to pay for premium deliveries.
Retailers must consider free and easy returns, with 65% of Australian consumers believing returns should not have associated costs and a noticeable generational divide in the frequency of returns. The research found that Gen Z is most likely to return purchases, with 31% preferring in-store returns and 21% favouring pick-up/drop-off locations.
Finally, despite easing inflationary pressures, the research reported that, moving into 2024, merchants are still concerned about rising overhead costs (37%), weak customer demand (31%), and intense competition (27%).
Retail Economics' CEO, Richard Lim, said: "Retailers must understand this evolution and prioritise seamless, consistent customer experiences - regardless of whether customers choose online, in-store, or a hybrid approach. Embracing a unified, omnichannel approach unlocks the potential for lasting customer loyalty and reinforces brand relevance in the competitive landscape."
