RealTime IT News

Australian E-Commerce Market Still to Mature

Only 20 percent of Australians have shopped online more than five times in the last 12 months, according to new research from US-based Jupiter Communications.

Speaking at the Internet World '99 conference and exhibition at the Sydney Convention and Exhibition Centre today, Jupiter's chairman and chief executive officer Gene de Rose said the Australian market is three years away from the emergence of a regular online shopping experience.

He said the challenge for online Australian business today is to build loyalty, think service and convenience, and to use customer service as a market ploy.

"The challenge to businesses worldwide is to play the business game better and to understand market dynamics," he said.

De Rose said in the last six months there has been a decline in online customer service. Many big companies are bruising their brand names online through the lack of strong customer service initiatives. Amazon is good at selling is because they have built a brand loyalty and a strong focus on customer service, added de Rose.

Further worldwide research by Jupiter has found that of those users regularly shopping on the Net (defined as 10-12 purchases a year), 77 percent go to the Web with a specific item in mind. Of this group, 80 percent visit only one or two sites before making a decision. Surprisingly, less than 10 percent buy on impulse.

The young affluent adult is still the prime target for online businesses but older audiences are coming online in 'droves' according to Jupiter. New audiences are being tempted online via offline cross promotions particularly through the use of mediums such as television and print media.

"Over the last 16 months Net audiences have doubled, but there is still a long way to go before the mass market is reached," de Rose said. During the presentation, he spoke of the company's plans to float on Nasdaq later this year.

Further details of the float are yet to be revealed but it is believed the company is planning to raise as much as AUS$50 million.