Is a retail apocalypse about to hit Australia? Monash University experts disagree, saying shoppers now have the power and the retail sector needs to change.
- Is Australia in the midst of a retail apocalypse? Monash Business School researchers disagree, saying shopping power is back in consumers’ hands.
- While some stores have closed, many other popular Australian brands are booming.
- Latest data shows more than 70 per cent of Australians prefer to shop in-store rather than online, bucking a global trend.
While many analysts are predicting a retail apocalypse for Australia, Dr Eloise Zoppos from Monash University believes this is simply a changing of the guard where shopping power is now firmly back in the hands of consumers.
As receivers knocked on the doors of household retailers, such as Harris Scarfe, EB Games, Jeanswest and Collette by Collette Hayman, many professional bodies and sector analysts predicted this was the death knell for bricks-and-mortar shops in Australia.
And with more than 300 stores flagged for closure in the early part of 2020, there is lingering uncertainty about the future direction of Australia’s retail landscape.
But Dr Zoppos, a consumer behaviour expert from Monash Business School’s Australian Consumer and Retail Studies (ACRS) unit in the Department of Marketing, says retailers who don’t listen to their customers and fail to adapt quickly enough will pay the price – literally.
“Customers are seizing control of the retail landscape and those retailers not up to the changes proposed by their loyal shoppers will be left behind,” Dr Zoppos said.
There are a number of retailers in Australia that are flourishing, according to Dr Zoppos. These include:
- Mozaic Brands – with key brands such as Noni B, Rockmans and Millers, Mozaic recently reported its underlying earnings would be up 36 per cent in the first-half of FY20 at around $32 million;
- Super Retail Group – which owns Rebel Sports, Athletes Foot and Hype DC, reported a 22.5 per cent increase in net profit to $53.8 million last year; and
- Cotton On – according to IBISWorld, the nation’s largest clothing brand reported a $2 billion turnover in the last financial year.
“Friendly and knowledgeable staff, and eye-catching and easy-to-navigate store designs, can help create memorable experiences that customers can share with their friends and family after their purchase,” Dr Zoppos said.
This comes as recent findings from the ACRS 2019 Omnibus Tracking Report showed Australians continue to buck the global trend and shop in-store rather than online.
More than 70 per cent of respondents to the annual survey said they either frequently shopped or preferred to shop in bricks-and-mortar retailers – a seven percentage point increase from 2018. Just 3 per cent of shoppers said they always bought goods online.
Three-quarters of Australian shoppers also indicated they would use the bricks-and-mortar stores in a similar fashion across the next 12 months, a slight increase on 2018.
Price continued to remain the most important factor for shoppers (86 per cent), followed by quality (67 per cent) and product availability (59 per cent). Brand loyalty and social sustainability were the least important factors.
“The power is back in the hands of consumers. The evidence shows Australians prefer to shop in physical stores and want to support businesses of all shapes and sizes,” Dr Zoppos said.
“Retailers can’t afford to take this support for granted and must continue to provide a great in-store experience for consumers.”
Read the full article at Monash Business School’s Impact.