Australian online retailers facing challenges: Forrester

Despite their rapid growth and global success, local retailers will need to overcome skills shortages and haphazard fulfilment

Australian online retailers, while growing rapidly and increasingly globally competitive, face stumbling blocks to their further growth and competitiveness, a new report from Forrester argues.

The study, Online Retailing in Australia 2010, examined a total of 334 Australian online retail professionals and found that while online retailers in Australia have typically lagged behind in the international market -- due to underinvestment by larger retailers -- they are growing quickly, often selling internationally, and performing against key metrics such as conversion rates.

Despite this, the research found online retailers will need to overcome issues such as haphazard fulfilment, if they are to continue their rate of growth in the future.

The report argues that Australia does not have the long tradition of mail-order catalog selling which is found in the US, meaning local retail businesses must make a larger effort to embrace online retail and overcome the challenge of logistics.

Forrester also claims a spillover effect of Australia’s lack of a large catalog-selling tradition is the smaller pool of retail professionals who have hardened skills in direct response selling in general, let alone in online retail in particular.

“Web development agencies and software vendors in Australia’s online retail sector often end up serving a CMO, CFO, or CIO rather than a specialised head of eCommerce, and they notice the slower decisions and greater requirement for on-the-fly learning that result from this situation,” the report reads.

As a result of the shortage of skills, retailers were also constantly be scrambling to keep up with the rate of growth, and instead of focusing on strategies and plans for the future, were restricted to simply keeping up with their to-do lists.

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