Australians are spending billions online every year, putting it in the top ten of online spenders worldwide. In fact, Roy Morgan reported in their State of the Nation report, in November 2016, that Aussies spent an estimated $41.3 billion on eCommerce purchases and this is on the rise.
Whilst Australian online spending habits tend to stay local at this stage, with 76 per cent of total sales going to home-grown online-only sites or the Internet offerings of local retailers, businesses need to continue to focus on their localised presence to compete with international heavyweights entering the market. Here are a few tips for SMEs that are being confronted with international heavyweights entering the eCommerce market.
Ultimately to be successful you need to create some differentiation in what the business offers compared to large multinationals. This approach needs to be focused and businesses need to be completely aware of the key differences of their product or service. This also helps with the local marketing strategies the business will employ.
Reputation is also integral to success, especially when competing with international retailers who have already built this up and the success and reputation will often transcend overseas. SMEs need to focus on their local reputation and have trust in their product. This trust cannot be bought, but earned. Reputation is built over long periods of time through customer relationships, alignments, sampling, testing, feedback and so on. Businesses need to build on their reputation and differentiation in order to be successful in a competitive online space.
Local customer service is a major bonus for Australian eCommerce businesses competing in their own market. By having an accessible, quick responsive local team that can help with general enquiries, deliveries, product or service questions and complaints, customers will have a more rewarding and tailored experience. Local businesses can also compete against internationals by tailoring their product to Australian specific needs.
If local SMEs are designing their own products, it is important to pay attention to international competitors and how they play a part in the sector you are focusing on. Some global businesses do not focus heavily on Australian needs as they simply consider the market to be too small compared to Europe and the U.S. This is where businesses can design a service or product for Australians, in a market that internationals don’t compete in.
It is really important for businesses to be an active contributor in their local market. Businesses should push to support events, community groups and go the extra mile, where international companies won’t or don’t have the time to focus on, as they are involved in so many clusters.
Australia is a small market (in a global company’s eyes), so multinational businesses may not have the same hands on approach whereas a local business can. Being involved in the local market demonstrates to consumers that the business has an unwavering passion for the industry it’s in, this perspective is so valuable in a competitive space.
Ben Crowley, Managing Director, Bulk Nutrients