Australia’s specialist online retailers are certainly being affected by the Global Financial crisis but sales appear not to be falling as much as traditional main-street, bricks and mortar retailers. Brisbane headquartered Dstore, is one of Australia’s largest and best-known on-line department store operators.
Chief executive Andrew Cooper said that DStore’s recent experience was quite positive with existing customers actually spending more online.
"We haven't experienced a slow down with existing customers and in fact their average spend over the Christmas season so far has risen from $88 to $113 which is interesting.
I suspect customers that know us are comfortable with shifting spending to us rather than travel to shopping centres where prices are typically more expensive."
But Cooper said it’s been a different story with new customers, and has been that was since the middle of the year.
"New customer acquisition really became difficult from July. We noticed a marked drop in performance from lead generating activity such as online key word advertising.
In fact, we made a decision to pull over 50% of advertising spend targeted at customer acquisition because it simply wasn't performing."
Cooper said that the global crisis had made customers less willing to take risks with spending as well as with investments.
"The message we're getting is that consumers are not experimenting with their spending, they're preferring channels that they're comfortable with rather than risking using new channels or merchants."
However Cooper said dStore is now up on last years sales figures and expecting a boost from the government's $1000 Xmas welfare bonus payments.
"We're now tracking above last year's numbers, however a couple of weeks ago we were behind. It's too early to tell if this is related to the cash bonuses or whether it was simply consumers delaying their purchases until the last moment, whatever the reason it's been pleasing to see."
For more information, please visit dstore.com.au.
Source: eCommerce Report