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Trends and issues related to online retailing

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Online shopping in Australia is becoming more prominent. – Official ABS statistics are not produced for domestic and overseas online retail sales in Australia. – Market analysts estimate that the domestic online share of total retail sales in Australia is between 3 and 7 per cent. The Commission considers the share to be at the lower bound of these estimates at 4 per cent. – Overseas online sales account for around a third of total online sales. That is, around 2 per cent of total retail sales are being spent on overseas websites. – Domestic and overseas online sales account for 6 per cent of total retail spending in Australia in 2010 which equates to $12.6 billion. By comparison, market analysts estimate the online share of retail sales in the United Kingdom and the United States at 11 per cent and 8 per cent respectively. Official estimates for the online share in the United Kingdom and United States are lower at 9 and 5 per cent respectively. – Online sales in Australia are projected to grow by between 10 and 15 per cent per annum over the next three years. New electronic devices including mobile phones with internet capability are stimulating further growth in online sales. Australian consumers are attracted to online shopping due to three main factors — lower prices, convenience and a wider range of goods to choose from compared to those available from bricks and mortar retailers. Online penetration of retail sales in Australia is much higher in categories such as books, CDs, DVDs, clothing, sporting goods, electrical and electronic goods, cosmetics, and toys, but much lower for groceries. Food retailing is the sector least likely to be exposed to overseas online competition. Just over one half of the retail industry in Australia could be regarded as trade exposed, but to

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