Online auction and retailing giant eBay says its top 2,000 sellers in Australia recorded revenue growth of 38% during 2010, with the most successful merchant turning over $12 million.
The figures were revealed as part of the Government’s online retail forum that took place in Sydney last Friday, where a number of online retailers and experts took part in discussions about the future of eCommerce and digital retailing.
“I think this is an acknowledgement that online retailing is here to stay,” said Daniel Feiler, head of communications at eBay Australia. “This is a huge part of what consumers are doing and it’s the future for retail.”
eBay said at the forum that individual sellers maintaining store fronts on eBay are recording substantial success – the top 2,000 saw their revenue grow 38% on the ebay.com.au domain.
The smallest member of the group of 2000 had sales of $120,000, while the largest had sales of $12.6 million.
The auction house also pointed out that that the number of domestic eBay sellers grew 10 times those of retailers in 2010 – eBay has been shifting its strategy over the past few years to more of a retail destination along with its traditional position as an auction house.
PayPal also attended the summit and said that in the last six months of 2010, 500,000 customers signed up with a PayPal account – the number of transactions of merchants accepting PayPal is growing at an annual rate of 19%.
Feiler says the comments show that Australian businesses need to be using online, and quickly – communications minister Stephen Conroy added at the event that over 70% aren’t offering products on the internet.
“There was plenty of discussion about multichannel offers. What this means is having a multi-dimensional approach – having your store on the shop front, or in the shopping centre, but it also means having something online.”
“Businesses need to have a website, they need to be selling online, and that doesn’t take away from the fact they have shop front and they will continue to sell offline as well.”
DealsDirect managing director Paul Greenberg agrees, saying businesses need to investigate as many channels as they can to sell to as many people as possible.
“The overarching theme I think is that this whole online versus offline thing is ridiculous. If anything there is a blurring with multi-channel retailing that is becoming much more prominent.”
eBay also says the figures were used as part of an argument to dispel fears that Australian dollars are heading offshore and local retailers are being left in the dust.
Feiler cites research from Forrester that shows online retailing spending will reach $36.8 billion by 2013, with 81% of those purchases to be made from local stores – he argues this is all the evidence local businesses need to start setting up local online shopfronts.
“Six million Australians visit eBay every month. One of the possibilities people can pursue is looking at eBay and thinking of what type of advantage you can get from that.”
“Domestic sellers are doing well on eBay – that’s the point we’re trying to make here.”
The online retail forum addressed a number of other issues, including logistics. Feiler says eBay Australia managing director Deborah Sharkey took part in a discussion about logistics, with the company saying that shipping options are lagging behind other developed nations.
“She acknowledged in her remarks that Australia is a large country, scarcely populated, but it is also the same size as the United States. Options for tracking your shipping and so on are not as advanced.”
“For example, in the United States or European markets, you’re seeing shipping services that have provided consumers with a lot of options. They want to know when it leaves the retailer’s door, when it’s on its way, and so on.”
The online retail forum came just one day after bookstore giants Borders and Angus & Robertson collapsed – both Feiler and Greenberg said the event was addressed at the forum.
Various commentators and experts have said online retailing plays a part in RedGroup Retail’s collapse, but Conroy, Feiler and Greenberg have said the issue is much more complex.
“It’s a tragedy that any company is going out of business and equally that people could lose their jobs,” Conroy said. “Technology marches on and there will be a transformation, there will be new jobs.”
Feiler says the issue is a combination of factors, rather than online retailers from overseas threatening Australian businesses.
“This did come up at the event. I think there are a series of factors involved in this. It’s not just about traditional media versus online – we have many booksellers on eBay who are doing very well.”
Greenberg agrees, saying that “this is a complex matter”.
“If you see the comments about the store, things are being said like the choice was poor, prices were expensive and the general vibe had gone down for a while. I’m not a Borders shopper, I can’t comment, but I hear that it was just not a great consumer experience.”
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
