Wires for wares: Oz online shopping up

Internet access in Australia has risen by 26 per cent in the past six months, according to a study issued yesterday by the KPMG Centre for Consumer Behaviour.

According to the May issue of KPMG's bi-annual Consumer Behaviour Monitor, 48 per cent of Australians are now connected or have access to the internet. The report goes on to say that nearly double the number of net users are visiting commercial sites today than did so in September 1999.

So far, however, the main use of the internet in the retail arena has been for product and services research. When it comes to actual purchasing, traditional outlets still compete successfully with online sales. About the same number of people buy the products they researched on the internet from bricks-and-mortar outlets as they do from websites.

According to KPMG's director, Brent Taylor, 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 which consumers still see as barriers to e-commerce: guaranteed security of financial transactions, guaranteed privacy, absence of delivery problems, cheap internet access, and improved ease of use.

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 out-buys the other consumer categories ("traditional" and "contemporary") by a significant margin, but is also much more connected to the net.

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

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