State of Australia E-Commerce in Peak Season 2021
Despite their origins in the US, Black Friday and Cyber Monday (BFCM) have gained much hype among shoppers in Australia. For the first time, Black Friday sales trumped Boxing Day sales in 2020, replacing the latter as the more popular event among Australians that year. With the supply chain crisis putting pressure on customers to start their holiday shopping earlier, how has the peak season performance been affected? Did Australian shoppers shop less during the BFCM weekend last year?
Our team has analyzed the effects of BFCM on parcel volume growth and transit time in Australia. We have segmented our analysis into 2 time periods:
Before BFCM: 1 Nov – 21 Nov
BFCM: 22 Nov – 12 Dec
Lower Growth Over Black Friday and Cyber Monday 2021 in Australia
In 2021, there was a 35.69% growth in e-commerce parcel volume during BFCM as compared to the pre-BFCM period. This shows a lower growth from the parcel volume growth experienced in 2020.
“2021 was unique because it seemed there were several X-Factors playing at once. Supply chain issues: from manufacturing to landing and importing to last-mile all created significant challenges for retailers. This was coupled with Australia’s two largest jurisdictions departing long and hard lockdowns. Furthermore, consumer behavior itself departed (from) trends seen in 2020 and previous years.”
Despite this downward trend in terms of peak season growth, this is surprisingly not the case for the overall e-commerce growth in the country. Based on a report by Australian Post, there was a 13.6% YoY growth in e-commerce purchases during November 2021. Moreover, there were also 7.4% more online purchases made during BFCM 2021 than in 2020.
“More and more, we’re seeing customers hold out until the Black Friday weekend for the best deals available. There’s a customer expectation that anything before this weekend is just a preamble. In some ways, I hope and think this will be a good thing. We might see a reduction in the number of brands trying to ‘go early’ for Black Friday, making this sales event easier for customers and brands to navigate,” said Ming Kang Chen, Head of E-Commerce at Sheet Society.
No Major Changes in Delivery Time over the Black Friday and Cyber Monday Period
Compared to the period before BFCM, it seems that delivery time in Australia was not significantly affected. There was a higher delay in delivery time during BFCM 2020, although not by much. Given the lower holiday e-commerce volume in 2020, it is no surprise that the logistics carriers did not experience any major delays back then.
The nation, however, experienced major delivery delays during the lockdown period in the second half of 2021. In preparation for peak season 2021, the region’s main postal operator, Australian Post, added 45 operational and retail sites. Furthermore, they also hired 4,500 new personnel to help them deal with the e-commerce surge. These efforts allowed them to increase their capacity by 30%, which has admittedly helped them face the latest peak season.
A Slight Reduction in the Percentage of People Opting for Collection Points
It seems that Australian shoppers prefer to get their holiday shopping orders delivered straight to their homes. Although there seemed to be a drop during the holiday seasons, we observed promising growth in collection points usage from the previous year.
Even before the commencement of the 2021 peak season, Ben Franzi, the General Manager of Parcel and Express Services at Australia Post had already advised shoppers to opt for collection points as their delivery method of choice to avoid any delays. More Australians today are opting for parcel pick-up points for their convenience as compared to home delivery. As such, it seems likely that the collection points adoption in Australia will only continue to increase from hereon.
How Peak Season 2021 Went for Australian Retailers
When asked about the latest peak season, Jay Bonaretti, CEO of Amino Z mentioned that they “experienced record online sales with major promotions yielding more than double the sales from the prior year.” Similarly, our friends at Harrolds also witnessed a healthy bounceback in the numbers last year. In the view of Sarah Razek, Head of Digital at Harrolds, “During peak 2021, I think there was clear excitement in the air regarding Christmas. So, people were very excited to be shopping for their loved ones.”
As for Aromababy, a premium Australian skincare brand, there was a strong mid-year July-August increase, with August outperforming month-on-month sales for the entire 2021.
“We did observe a trend of increased sales of baby gifts and even personal shopping of our natural and organic skincare items from regions which were being impacted by the pandemic…This tells us more people (new parents) were online and purchasing not only essentials but additional items as well,” said Catherine Cervasio, Founder & CEO of Aromababy.
What’s Next in Retail and E-commerce?
As the e-commerce growth stabilizes, we are excited to see what’s next for Australia’s e-commerce landscape in 2022 and beyond. Look out for our next editions as we review the peak season performance across different regions around the world!
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