Physical shops remain the main point of purchase for most Australian Christmas shoppers, but it is online stores which are fuelling growth in a muted retail market.  

While just 1.5% of respondents to EKAS’s Christmas Retail poll – conducted in early November – said they would do all of their Christmas shopping online, nearly a third (29.9%) said they would not be making any purchases online. However, 32% of respondents said they would make at least half and 70.1% said they would make at least one Christmas related purchase online. 

But while bricks and mortar retail stores are the main money-makers for now, it is the ecommerce category which is set to fuel growth into the future for shoppers.

Ecommerce is driving future spend

When asked whether the improvements in ecommerce over the last five years has made respondents increasingly likely to spend more at Christmas, the result was perhaps surprising. All told, a narrow majority of 51.6% said no, compared to 48.4% who said newer technology made them more likely to splash out.

But when we break the numbers down by demographic we see younger respondents are, perhaps unsurprisingly, being enticed to spend more by eCommerce offerings. 

There were 70.5% of respondents aged 18-34 who said improved ecommerce was driving their Christmas spend upwards, compared to 60.6% of 35-44 year olds, 56.1% of 45-54 year olds, 32% of 55-64 year olds, and just 23% of 65+ respondents.

Interestingly, 54.5% of men compared to 45.5% of women said they were now more likely to spend more thanks to improved ecommerce options. This is perhaps indicative that males are more reluctant to brave crowded shops during the Christmas period, and are enticed by the idea of hassle-free alternatives.

But the overall message couldn’t be clearer for retailers. An efficient, easy to use digital shopfront with a frictionless checkout will be the key to a merry (and prosperous) Christmas now and in the years ahead.

Savings and Convenience

Saving money and time stand out as the main reasons people are turning to online shopping. All told 80.7% of respondents said they felt it saved them time, while 69.5% cited saving money. A further 47.8% said they appreciated having gifts delivered to their door, with slightly more females (49%) to males (44%) feeling this way. 

The desire to avoid busy shops was, perhaps surprisingly, not a huge issue for online shoppers, with only 36.1% of respondents saying it mattered to them. This number skewed higher for most senior demographics though, with 38.5% of over 65s citing it as a factor – a sign that the bustle of Christmas crowds can be off-putting for the older or less mobile.

Just 12% of respondents said online shopping was preferable since they wouldn’t have to deal with in-store salespeople. Curiously only 1.3% of male respondents cited this factor, while 11% of female respondents did so, suggesting perhaps women are targeted more regularly by shop assistants.

 

Danger for Department Stores?

The travails of modern day department stores – expensive real estate combined with diminishing foot traffic – are well known. This survey’s results suggest they are set for more pain. In total, 62.3% of respondents said they still planned to visit a department store like Myer or David Jones for their Christmas shopping, but over a third of respondents (37.6%) didn’t have such a retailer in their plans.

Interestingly, older demographics are less likely to be planning a department store visit than younger ones. Over 65 year olds voted 54% to 46% in favour of visiting, while the 25-34 year old demographic by comparison saw 68.7% saying they would visit a department store and just 31.3% avoiding them.

Income does play a part in this behaviour. Willingness to shop at a department store rose markedly in line with wealth, with 50.1% of respondents who earned up to $75,000 per annum shopping there, compared to a loftier 76.4% of those who earned over $100,000 per annum.

 

The trend to spend

Just 16% of respondents overall expected to spend more this year than in previous years (but 25.5% of men felt this way compared to 12.1% women). Those aged 35-44 were the age band that most anticipated spending more (19.7%) – with growing families a likely contributing factor.

Overall, 51.5% of respondents said they’d likely spend roughly the same amount as last year, although 32% expected to spend less. In every demographic surveyed, a rigid 32%-34% said they would spend less, save for the 35-44 year-olds, of whom 29% said they would do so.

Drilling down further, the survey observed that it was the higher income earners who were least likely to be spending less this Christmas. Of those who expected to tighten the purse strings over Christmas this year, 75.8% of them earned $100,000 per annum or less, while just 24.2% of those earning over this amount were looking to cut their festive outlay.

 

The Rise of Retail Events Drives Earlier Festive Shopping

Overseas pre-Christmas retail events are growing in prominence. In Australia 77.2% of people have heard of Black Friday (the day following US Thanksgiving), 39.7% are familiar with Cyber Monday (the Monday after US Thanksgiving) and just 9.3% have heard of Singles Day (a Chinese retail day that falls on November 11 annually – see related story). However, 20.3% of those surveyed were not familiar with any of these days. Recognition of these events over-indexes with younger demographics.

 

Another side-effect of the rising popularity of these November events is the encouragement of earlier shopping. There were 28.6% of respondents who now start their Christmas shopping before November, and a further 31.7% who have started shopping before December. Just 24.4% commence their festive purchasing in the first two weeks of December, while those leaving it all until the last 10 days before Christmas number 15.1%.

And while it’s something of a cliche that men are shopping-averse, it’s true that a greater number of men are likely to start their Christmas shopping later than women. Some 46.8% of male respondents said they don’t dust off the debit card until December, compared to 36.5% of women.

 

Aussies’ Online Favourites

Among online Christmas shoppers it seems the most popular method of bagging a bargain is to bid low. There were 71.1% of respondents who used the well established platform Ebay to shop, far and away the leader among online shopping sites. Its popularity tapered off as demographic age rose, however even it’s lowest uptake was 62.5% for the over 65s.

Coming in next was Amazon with 38.1% of respondents using the site (which has just this year launched into Australia), and interestingly, a much higher proportion of men were users at 55.3% compared to 30.7% of women. Younger demographics made more use of Amazon’s services, with 55-64-year olds the least engaged, with a 28.8% uptake.

 

Other popular sites included Kogan (27.3%) with 34.2% of males compared to 24.8% of females shopping here, while Booktopia (23.7%) saw the opposite skew with 28.9% of females shopping against just 11.8% of males. What does this mean? Well, it perhaps suggests that women are more likely to be seeking out a relaxing summer read, while men might be keener on a new flatscreen TV or gadget.

Fashion focused retailer The Iconic attracted 18.9% of shoppers with over 22% of all demographics under 55 years making use of their services. However, thanks to its largely youth-oriented marketing, just 10.5% of 55-64s shopped on this site, while a mere of 5.1% of over 65s did so.

EKAS’s Christmas Retail survey polled 356 Australians aged 18 and over.

If you have a social research project or survey you would like to conduct, you can contact Jaxon (jaxon@ekas.com.au) or Matt (matthew@ekas.com.au) to get the ball rolling

 

Ekas Research
Ekas Research jaxon@ekas.com.au

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