Surviving and thriving with e-commerce

In the future, bricks-and-mortar retailers will adapt innovations developed for online commerce to transform the real world shopping experience and how they do business.

Australia has a unique retail landscape, home to a heavy penetration of department stores and local designer brands popular among tourists and locals alike. In fact, anonymised and aggregated transaction data indicates that there is a long runway for Australia to catch up to the U.S. in e-commerce penetration.

This includes categories such as apparel, department stores, and electronics. the arrival of prominent online-only players to the Australian market has been long anticipated, this is now a reality, and traditional retailers are considering how they will continue to captivate and maintain the loyalty of Australian consumers.

Today’s consumers are driven by experience, and brick-and-mortar stores are an experiential asset most e-commerce giants don’t have. Many retailers are (and should be) considering the end-to-end customer journey and the experience they provide customers both online and in-store. How they enhance that journey to make it more seamless and enjoyable will be a decisive divider of winners and losers.

Globally, the most commonly adopted response to online competition is increasing investment in online channels. According to a recent global report from Applied Predictive Technologies (APT), with research and analysis from The Economist Intelligence Unit, 75% of retail respondents indicated they are employing this tactic.

However, there is a broad array of responses Australian retailers could be considering in order to not only survive the change in the retail environment but capitalise on it and mobilise towards omni-channel excellence. It is also important to consider that the Australian customer is not the only prize for incumbent players – the ability for the rest of the world to shop Australian goods online poses a far more expansive opportunity to explore.

Taking a deep dive into the evolving Australian retail landscape, Mastercard developed a new whitepaper, E-Commerce Giants Head Down Under: A Playbook to Survive and Thrive in Australian Retail, which looks specifically at the Australian retail sector and what makes the Australian shopper unique.

Based on research findings, the below approach has been formulated to help Australian retailers to prepare and adapt:

· Build a seamless shopping experience across channels, whether shoppers begin the customer journey online or in-store.

· Understand customer behaviour; use anonymised and aggregated insights to personalise offerings accordingly.

· Reinvigorate the retail store experience to provide unique reasons for customers to return.

· Constantly assess pricing strategy and value proposition; trial new initiatives with customer subsets and establish a culture of conducting business experiments to evaluate new programs.

· Partner with the right external institutions; consider collaborations which will complement services or offerings.

Reassuringly for Australian retailers, while online presence and customer engagement are crucial for business sustainability, being online-only is not yet enough to drive trust among Australian consumers, as 50% still prefer to shop with traditional retailers online rather than with online-only retailers.

Australian retailers have a long history and brand presence with their customers, as well as a long-standing understanding of their mindset and behaviour. Capitalising on the opportunity to evolve their omni-channel strategies will only fortify their connection with the customer and increase brand loyalty.

Marc Carolus is Principal, Mastercard Advisors in Australasia. Mastercard is a technology company in the global payments industry, operating the world’s fastest payments processing network and connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. For more information visit



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