Pattern has released a new report indicating that the recent Cyber Sales period delivered strong results for Australian retailers.
The company released the data, which shows a 10% average year-on-year revenue increase for participating brands, as part of its Cyber Weekend Benchmark Report.
The report's findings also include that 2022's cyber sales grew website traffic by 8%, as well causing a 1% increase in conversion rates and average order value (AOV).
Black Friday holds the strongest AOV for 2022, of $155.
The only metric that noticed a decline this year was units per order, which dropped by 7%.
"The recent Cyber Sales period delivered strong returns for Australian brands, who will be relieved following a softer operating period.
"The results were pleasing across the board and although the average amount of units per order was down, this had no bearing on actual order spend," says Merline McGregor, General Manager, Pattern Australia.
"Whether the recent strong performance for brands through the Cyber Sales period is indicative that 2023 will be a prosperous year for Australian brands or not is yet to be seen.
"There are significant economic headwinds with rising interest rates impacting on household budgets, which could limit retail spending through next year."
Pattern notes the retail sector is anticipated to see challenges in 2023 and suggests some trends brands should consider to have the best chance of engaging with and onboarding new customers.
Pattern's Key eCommerce Predictions for 2023:
- Social commerce is the best way to connect with Millennial and Gen Z shoppers
6.4 million Australian consumers are expected to use social media for online shopping by 2024 as platforms such as Facebook, Instagram, TikTok, and Pinterest improve their social commerce capabilities.
"We anticipate that although influencers will continue to be an asset to drive consideration for purchase, the growth in brand social commerce spend in Australia will increasingly be allocated to top-of-funnel activity like brand awareness engagement and e-store traffic," Merline says.
"As a result, pixel and product feed hygiene must become a priority for brands seeking to attract and convert Millennial and Gen Z buyers across social media."
- Amazon has made the local online marketplace sector into a dominant player
Acknowledging that tighter household budgets will cause Australian shoppers to be more conservative with their spending, Pattern says this will change shopping behaviour.
Further, because consumers perceive online marketplaces to offer better price value, more customers use these platforms.
The report also notes a 50% increase in marketplace revenue during Cyber Week, with Tuesday and Wednesday seeing the most significant growth at +189% and +204%, respectively.
Pattern says succeeding in a competitive online marketplace environment requires brands to develop and carry out Amazon go-to-market strategies as the platform grows its market share against eBay and becomes dominant in Australia.
"Currently, 30% of Australians have an Amazon Prime membership, a figure expected to rise dramatically in the coming 12 months as the company builds out its infrastructure and attracts new shoppers through price and convenience.
"In 2023, brands must become active on key marketplaces to not only broaden their reach and drive revenue, but also act as a defence strategy against competition and unauthorised sellers," Merline says.
- Nurturing existing customers is the key to offsetting the lack of new ones
Pattern says more conservative spending will see 2023 challenge the onboarding of new customers, requiring brands to nurture their existing customers and invest in activities that foster loyalty.
Tactics such as using existing buyer data to personalise recommendations and shopping deals will create better customer experiences, building loyalty and opening up new sales opportunities.
"Today's brands are rich in customer data, and these days that is often overlooked or underutilised," Merline says.
"In 2023, retailers can help offset a predicted downturn in new shopper activity by building personalised customer campaigns that reference existing shopper data to maximise sales from those people already familiar with your brand."
Convenience will be a focal point for eCommerce brands in 2023, as retailers will look to nurture the 'new to eCommerce' customer set that came through in the past two years.
Using a strategy such as a subscription model will offer powerful ways to provide customer stickiness, especially as large players such as Amazon look to expand their Subscribe & Save offering.
"There is no doubt that 2023 will be a period of change for the Australian retail sector. Brands will be challenged by a likely reduction in consumer spending and a shift in buyer behaviour as shoppers evolve the channels through which they discover and purchase goods," Merline adds.
"Retailers need to meet these demands and become active on platforms that their customers prefer in order to connect, engage and sell."
