Is Australia the land of opportunity for your retail brand?

With up to 40% of Australians’ online purchases made on UK or USA websites, and a thriving ecommerce market, Australia could be your next port of call for online retail success.

Australia has a resident population of more than 24 million and, according to eMarketer, the country’s ecommerce sales are predicted to reach A$32.56 billion by 2017. The country’s remote location in the APAC region means that unlike European countries or the USA, traditionally there have been a lack of global brands sold locally.

Of course, we also know that many expatriates, particularly from inside the Commonwealth, have made Australia their home and are keen to buy products they know and love from their country of origin.

All of these factors present a huge and potentially lucrative opportunity for non-Australian brands wanting to open up their new and innovative products to a fresh market, or compete for market share.

But it’s not just non-Australian retailers who are at an advantage here: Australia was late to the ecommerce party because native, established brands were trading well without it. Subsequently, Australian retailers’ ecommerce technology stacks are much more recent and not burdened by legacy systems. This makes it much easier to extend, or get started with, best-of-breed technologies and cash in on a market that’s booming. To put some of this into perspective, Magento’s innovative ecommerce platform currently takes 42% of Australia’s market share and the world’s first adopter of Magento 2.0 was an Australian brand.

The GST loophole

At the moment, local retailers are campaigning against a rule that exempts foreign websites from being charged a 10% general sales tax (GST) on purchases under A$1,000. And in 2013, Australian consumers made $3.11 billion worth of purchases under A$1,000.[1]

While the current GST break appears to put non-Australian retailers at an advantage, Australian-based brands such as Harvey Norman are using it to their advantage by setting up ecommerce operations in Asia to enjoy the GST benefit.

Australian consumers have also countered the argument by saying that price isn’t always the motivator when it comes to making purchasing decisions.

It’s not a place where no man has gone before

Often, concerns around meeting local compliance and lack of overseas business knowledge prevent outsiders from taking the leap into cross-border trade. However, this ecommerce passport, created by Ecommerce Worldwide and NORA, is designed to support those considering selling in Australia. The guide provides a comprehensive look into everything from the country’s economy and trade status, to logistics and dealing with international payments.

Global expansion success stories are also invaluable sources of information. For instance, it’s not just lower-end retailers that are fitting the bill, with brands like online luxury fashion retailer Net-a-Porter naming Australia as one of its biggest markets.

How tech-savvy are the Aussies?

One of the concerns you might have as a new entrant into the market is how you’ll reach and sell to your new audience, particularly without having a physical presence. The good news is that more than 80% of the country is digitally enabled and 60% of mobile phone users own a smartphone – so online is deeply rooted into the majority of Australians’ lives. [2]

Marketing your brand

Heard the saying “Fire bullets then fire cannonballs”? In any case, you’ll want to test the waters and gauge people’s reactions to your product or service.

It all starts with the website because, without it, you’re not discoverable or searchable, and you’ve nowhere to drive people to when running campaigns. SEO and SEM should definitely be a priority, and an online store that can handle multiple regions and storefronts, like Magento, will make your life easier. A mobile-first mentality and well thought-out UX will also place you in a good position.

Once your new web store is set up, you should be making every effort to collect visitors’ email addresses, perhaps via a popover. Why? Firstly, email is one of the top three priority areas for Australian retailers, because it’s a cost-effective, scalable marketing channel that enables true personalization.

Secondly, email marketing automation empowers you to deliver the customer experience today’s consumer expects, as well as enabling you to communicate with them throughout the lifecycle. Check out our ‘Do customer experience masters really exist?’ whitepaper for some real-life success stories.

Like the Magento platform, dotmailer is set up to handle multiple languages, regions and accounts, and is designed to grow with you.

In summary, there’s great scope for ecommerce success in Australia, whether you’re a native bricks-and-mortar retailer, a start-up or a non-Australian merchant. The barriers to cross-border trade are falling and Australia is one of APAC’s most developed regions in terms of purchasing power and tech savviness.

We recently worked with ecommerce expert Chloe Thomas to produce a whitepaper on cross-border trade, which goes into much more detail on how to market and sell successfully in new territories. You can download a free copy here.

[1] Australian Passport 2015: Cross-Border Trading Report

[2] Australian Passport 2015: Cross-Border Trading Report

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