Well! A busy week in ecommerce in the Australian media, first with Michael Pascoe’s scathing article on the retail strategies of Myer and David Jones, then the “success”/debacle that was Click Frenzy that was Click Frenzy.
Pascoe is correct that the UK and US markets are different to Australia. Aside from being markedly larger, they also have a catalogue culture. Pascoe also makes the point that Australia is over serviced by department stores, and that “for most people, it’s comparatively easy to visit a Myer or David Jones shop”. But is that true enough to stop people shopping online? The more I reflect on this, the more I think this misses the opportunity that is largely unexplored in Australia. Would it be more convenient for me to visit David Jones (which is right across the road from my work), than for the average American to visit Nordstrom’s? Yes. But it would be even more convenient to order from David Jones online. Not with their current store, however, as it still has some significant issues, but not having to leave my desk or my sofa at home is undoubtedly more convenient than even the short trip to my closest DJs. And that is what Australian’s are increasingly doing, ordering online after hours, or ordering online during work hours. Really, the time doesn’t matter as long as one is near a computer.
The Pascoe article uses the prevalance of Australian department stores to claim that the target of 10% of sales online is ambitious for David Jones. My argument to that would be that while the strategy is not recolutionary, and may indeed be largely mimicking overseas retailers, does not invalidate it as a direction. Many a strategy has been copied with great success.
Pascoe is entirely correct that a major factor for local retailers will be the intrusion of overseas competitors shipping cheaply to Australia. With many of these retailers engaging local PR companies to raise public awareness of their offer, I’d say that this would be the major obstacle to David Jones and others realising their ambitions: can they price competitively and achieve a similar or better customer experience. Reviewing the current offerings, it looks like it will take some time for Australian retailers to compete on those factors.