Australian customers are changing the way they shop. We sat down with Vanessa Lennon, Head of Marketing at PayPal Australia, to discuss the change in shopper habits and the importance of building trust with customers.
According to new PayPal research, 68 per cent of Aussie shoppers are multichannel shoppers. How can small and medium-sized businesses jump on this bandwagon and improve their overall sales?
For Australian SMBs, maintaining and building an integrated online experience will be critical to future success. We found that 68 per cent of Aussie shoppers are multi-channel shoppers – which means they shop and browse via different platforms like websites, marketplaces or social media. Australian online shoppers are now really looking to interact with a business where they are already spending time, not just where they might have traditionally shopped.
For SMBs, it’s about understanding what the best channels are for their customers. Having a successful multi-channel retail strategy doesn’t mean you need to be across all channels, but that you find and own the channels that work for your business.
What are some extra benefits of having an online presence?
Having an online presence also opens up many opportunities for customers to purchase your goods or services because they can buy anywhere and at any time. When it comes to having a multi-channel online retail approach, the benefits grow. Our research showed that multi-channel retail could help to drive future sales, with 32 per cent of Gen Z and 26 per cent of Gen Y saying the ability to shop on multiple platforms would motivate them to spend more when shopping online.
An additional benefit of being online is building trust and brand legitimacy with customers. We found that more than a third of online shoppers sad that if a company doesn’t have a website and they can’t find them online, that they are either old-fashioned or dodgy.
Is there a stronger platform that consumers are more inclined to go for in terms of shopping? I.e. Instagram, online marketplaces, Native Apps, e-commerce platforms?
We did not look at shopping preference across all channels for this research. However, we did find that despite the plethora of options available, Australian consumers still prefer to purchase via the company’s own website. More than half of Australian online shoppers (56 per cent) indicated that they plan to do most of their online shopping via a company’s own website in the next year.
Online shoppers cited they preferred a company’s own website over a marketplace because it saved times (47 per cent), it’s easier to find items on sale (38 per cent) and because there is better customer service (35 per cent). Websites will continue to play a central role for online shoppers and should be a focus for SMBs as they broaden and grow their multi-channel offerings.
Customers need to trust a retailer before they make a purchase. Does this apply to online retail, too? And if so, how important is trust for consumers and the retailers?
Building and maintaining trust with customers is central to driving sales. Our research showed that company-owned websites and secure payment methods are key to building trust, and Aussie shoppers believe that websites will continue to be key drivers of trust, with over a quarter of online shoppers (26 per cent) agreeing that in the future, companies without a website will be unable to win the trust of Aussie shoppers. Fifty-six per cent of those surveyed also said that they do not trust companies who don’t offer secure ways to pay online.
We are certainly seeing the evolution of the multi-channel shopper. Shoppers, especially younger shoppers often move between multiple channels and play the field before committing to a purchase. Shopping in-store is often a part of this journey. Close to two-thirds (64 per cent) of Gen Z and 55 per cent of Gen Y have found a product in-store and then searched for it online to find a cheaper price. For SMBs to succeed in this evolving retail landscape, they need to understand their customer journey and make sure they interact with customers across that journey.
How can PayPal ensure small and medium-sized businesses can have an online strategy that reflects the wishes of online shoppers?
At PayPal, we constantly conduct research which aims to help arm SMBs with the insights they need to know to meet and exceed consumer expectations. For example, when we talk about websites and the online experience, we’re not just talking about desktop, it’s got to be mobile first. Research from our mCommerce Index found that on average, 25 per cent of online sales is now taken via mobile. That was a 32 per cent YoY increase from 2017. In terms of the practical ways in which we support SMBs, we offer a secure and trusted way for consumers to pay. Consumers know that when they checkout using the PayPal button that they are not sharing their credit card or banking details with the seller. Consumers can purchase confidently when they pay via PayPal.
When consumers enter a brick-and-mortar store, the shopping experience is a factor that can massively impact the future of their shopping habits. How does this play into the online retail industry? Is experience just as important for e-commerce as it is for physical stores?
The online shopping experience is just as important as the in-store experience. The online experience is the first thing a customer will know about a brand and can be make-or-break for completing a purchase. A positive online experience can help to drive repeat customers and lead to customer referrals and drive sustainable growth, especially in a highly competitive e-commerce market.
For example, we found that nearly half of Australian online shoppers have done repeat business with a company because they enjoyed the experience on their website. While 31 per cent of shoppers has recommended a company to family or friends based on the ease of shopping on their website.
Do you have any advice for small to medium-sized businesses for building a resilient and shopping-worthy online business?
Online shoppers want to interact with businesses in multiple ways and across multiple channels. However, the website remains the most preferred and trusted way for Australians to shop online and is central to building and growing a successful digital business. Building and maintaining a multi-channel online offering will be essential to the future success of Australian small to medium businesses, however, first and foremost SMBs must focus on the central role a website can play in building trust and creating great experiences for customers.