Aussies keen to buy now, pay later, as online marketplaces record “booming” growth
Buy now, pay later services are boosting the already booming online retail market.
Total Australian online shopping purchases soared to a record $21.3 billion last year, with ‘buy now, pay later’ services gaining increasing traction with consumers, according to new Australia Post research.
Australia Post’s Inside Australian Online Shopping report reveals online shopping spending grew 18.7% year-on-year, outpacing traditional retail by 16.2 percentage points, and reaching 8% of total traditional retail sales, while local retailers accounted for more than 80% of total online spend.
Total purchases grew 19.2% in 2017, with the report forecasting that by 2020, one in 10 items will be bought online.
‘Buy now, pay later’ services – which allow consumers to buy products immediately and then pay for it in instalments – are gaining momentum, with Australia Post estimating they accounted for 7.7% ($1.6 billion) of total online goods spend. According to the report, these services have a particular appeal for the 18—39-year-old demographic, as they provide “instant gratification with low entry level and can also be used as a budgeting tool”.
Fashion shoppers are among those most keen to use ‘buy now, pay later’ services, with 57% of buy now, pay later purchases fashion-related, while 10% of beauty transactions were made using ‘buy now, pay later’ platforms.
Australian shoppers are also increasingly gravitating to online marketplaces, attracted by the convenience of being able to access a range of products in one place.
“Marketplaces – such as Amazon, eBay and Etsy – are booming, growing 74.8% in the past year alone,” Australia Post parcels and express services general manager Ben Franzi commented.
“Australians really appreciate the convenience of being able to access goods from a variety of sellers in the one location.
“In the past year we have seen new marketplace entrants, which is always great to see, in recognising the increased customer traffic that this type of format offers.”
Franzi also observed that marketplaces in key export markets, including China, the United States and India, are providing an avenue for Australian businesses to sell to consumers overseas.
“By 2019, total online goods purchases from across the globe is set to reach $US2.16 trillion ($2.86 trillion), so this market represents a huge opportunity for Australian retailers,” he said.
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