Wires for wares: online retail shopping grows: But research still the main use in the sector

Despite the main use of Internet in the retail arena being for research into products and services its access in Australia has risen by 26 per cent in the past six months and it could be five years before there's a significant change, according to a recent report.

KPMG Centre for Consumer Behaviour said in the May issue of its biannual report that 48 per cent of Australians have access to the Internet. The report said almost double the number of users are visiting commercial Web sites today compared to September 1999.

When it comes to actual buying, however, traditional outlets still compete successfully with online sales. About the same number of people shop in physical outlets for the products they researched on the Net as buy from Web sites. KPMG's director, Brent Taylor, said, if current trends continue, online competition to conventional retail sales could form a significant threat as early as 2005.

But that result depends on the resolution of a number of issues that consumers still see as barriers to e-commerce: security of financial transactions, privacy, delivery, cheap Internet access, and improved usability.

The report also suggests that online merchants need to develop focused retail strategies to target what it terms "super consumers" - the high-spending 25 per cent of the population that not only outspends other consumer categories ("traditional" and "contemporary") by a significant margin, but is also much more connected to the Net.

Interestingly, the study also showed, age demographics do not play a role in this breakdown as super consumers are just as likely to be older people as the Net-savvy young.

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