MHD E-COMMERCE
COVID-19 DRIVES AN E-COMMERCE REVOLUTION Australia Post reported its busiest day in history due to a record breaking boom in online consumers. Ben Franzi, General Manager, Parcel & Express Services at the organisation accounts how this is a transformational time for the nation’s post and parcel service.
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illions of people around the world are being encouraged to stay home in an attempt to flatten the curve of infection from COVID-19. In Australia, many people are also being encouraged to work from home. This rapid change in routine has led to a significant change in consumer behaviour. Following the stay-home directive, people are forced to use the internet to connect with loved ones, participate in gym classes, or even see a doctor via an online video conferencing service. Another change in behaviour during COVID-19 is in people’s shopping habits. Across Australia, there has been a huge increase in online shopping as people take to retail therapy during the coronavirus lockdown. This trend can be seen across the world, with Italy also reporting an 81 per cent increase in e-commerce transactions since the end of February, estimates by McKinsey & Co reveals. The UK, France and the US have also reported similar increases. Ben Franzi, General Manager, Parcel & Express Services at Australia Post says Australia is very much on the same upward trend. “Comparing April this year to last year, the growth rate we’ve seen is between 60 and 80 per cent. We’re seeing almost close to a million additional shoppers on a regular basis,” he says. Traditionally April is a quiet time of year for e-commerce. After the peak spending across Christmas and new year sales, shoppers tend to tighten the purse strings before starting to hit the
16 | MHD JUNE 2020
shops again around Mother’s Day. However, the growth that Australia Post has seen throughout April 2020 is even larger than previous peaks around Cyber Monday, Black Friday and the lead up to Christmas. “Even looking at the figures against Cyber Monday last year, there is more shoppers in this market. We’re seeing new consumers who have never shopped online before now shopping in a big way,” Ben says. The Tuesday after the Easter long weekend was declared as Australia Post’s busiest day on record. While the volume is variable week to week, Ben says it’s somewhere between two and five per cent increase on Australia Post’s busiest days in the Christmas shopping period last year. When Australia went into Stage Three lockdown at the end of March, there was an initial increase in panic buying, items like household goods, wine, puzzles, children’s toys. However, Ben says this volume is yet to normalise. “It’s massive growth and it happened almost overnight,” he says. “The panic buying hasn’t really dropped away. We’re consistently seeing growth rates of 60 per cent as people start to settle into a new norm. I would suggest that the panic buying is over and what we’re seeing Is a new trend in buying online.” Before COVID-19 transformed Australia’s shopping habits, the country was slightly behind some other European markets when it came to the percentage of retail spend online. In the UK for example, e-commerce accounted for 16.5 per cent of business turnover in 2017.
According to Ben, pre COVID-19, Australia’s e-commerce spend was around the 11 to 11.5 per cent mark of total retail expenditure. However, while it may be too early to make accurate assumptions, Ben is predicting that as we come out of this period the figure will be more like 15 per cent. “The growth may soften for a little
The recent growth that Australia Post has seen across its network is more significant than previous peaks around Christmas, Black Friday and Cyber Monday.