Category Archives: online shopping

Where Kiwis Shop Online

The latest Nielsen Online Retail Report is now with us, and it reveals the usual tantalizing collection of statistics and trends.

Probably the most significant (and inevitable) is the dramatic growth in shopping through mobile devices, as the growth in smartphone penetration in New Zealand is mirrored in device usage. As Nielsen notes:

New Zealanders shopping online ‘anytime, anyplace’ on mobile devices, such as smartphones and tablets, increased significantly last year. Nielsen has found that 41 percent of smartphone owners made a purchase via the device and 58 percent of tablet owners. There are now 655,000 people shopping on their smartphones, growth of 127 percent year on year and 414,000 on their tablet (a 73% increase).

Tony Boyte, Research Director, Nielsen, explains, “For those purchasing via a smartphone, growth comes from those who are now comfortable using all the benefits it has for making shopping decisions on the go. But for tablets, their use in the shopping process is in line with ownership growth. As tablet ownership grows, we expect to see an even bigger increase in purchasing using a mobile device over the next year.

Boyte continues, “Mobile devices also have a considerable role in the path to purchase. New Zealanders are using their smartphone and tablets for researching products, competitive price checking, finding store locations and shopping lists. Smartphones in particular are constant companions to shoppers on-the go either in-store or while travelling.”


Source: Nielsen

By the way, we called the above findings inevitable because they’ve been trending that way for some years, and the tipping point just arrived. That’s why we feature Mobile Shopping strongly in our Mastering eCommerce online course and why we’ve recently introduced a new Mobile Marketing course.


The Top Ten Shopping Websites That Kiwis Visit Online

Top Ten Websites Where Kiwis Shop Online

Source: Nielsen Online Ratings 2013 vs 2012

Trade Me Still Number One for Kiwi Online Shoppers, But Watch The Warehouse

To no-one’s surprise, Trade Me continues to dominate the segment, reaching 56% of All New Zealanders (2+). What’s of particular interest, however, is The Warehouse, which has grown its audience 30% year on year. That growth is in line with one of its four current Strategic Priorities, to ‘be the leading multichannel retailer in New Zealand’. As the Warehouse Group noted in its 2013 annual report:

Multichannel and direct customer engagement
More and more Kiwis are shopping on our online store – we now have our full range of general merchandise, apparel and over a million books available and we have launched Red Alert, our daily deal site. Our online customers can now personalise their account telling us what their interests are, and key dates in their lives so we can tailor our marketing and communications with them.

Our online offerings ensure New Zealanders can shop “Anywhere, Any Way”. They also give us more opportunities to be the ‘House of Bargains’ with unique offers, like our recent successful sale of Piaggio Scooters, chicken coops and rabbit hutches on ‘Red Alert’.

We will continue to improve our online store and make it easier for our customers with new developments such as our ‘click and collect’ option which means customers can buy online and pick up in store and our soon to be launched mobile app, making it even easier to buy online.


100,000 More Kiwis Now Shopping Online

The Nielsen Online Retail Report shows continuing growth in eCommerce. Kiwis have well and truly embraced internet shopping. There are now 1.9 million New Zealanders shopping online, 56 percent of the total population. The number of people shopping online increased by over 100,000, growth of six percent in the last year.


Source: Nielsen Online Retail Report 2014


Kiwis are now buying online more often

At the same time, the number of purchases made by each person is buying is increasing at a rapid rate. Nearly half a million Kiwis each made 11 or more purchases on the internet last year, an increase of 58 percent in the last two years. This is reflected in spend with $3.8 billion spend online in 2013 and an expected increase to $4.15 billion this year.

What did they buy? These were the most popular categories:


Source: Nielsen Online Retail Report 2014

Nielsen notes: “While all of these categories have traditionally been strong for online shopping, we are seeing great growth in the number of people purchasing clothing/ shoes/ accessories, books/ magazines, plus smaller categories such as computer equipment, baby supplies, furniture, consumer electronics and groceries.”


$1.3 billion spent by New Zealanders on websites based overseas

The BNZ Online Retail Sales Index data we’ve been tracking (here, here and here) shows that the big growth story in online shopping is Kiwis buying from international stores. The Nielsen data reinforces that, reporting that “$1.3 billion is spent by New Zealanders on websites based overseas, with USA, Australia and the UK the most popular. 34 percent of the total amount Kiwis spent shopping online is spent overseas, an increase from 26 percent the previous year and double that of 2010.”

The complete Nielsen Online Retail Report 2014 is now available to purchase here.

Online Shopping Continues To Grow, But …

The latest BNZ Online Retail Sales Index (covering the 12 months till the end of February 2014), shows continued growth in online shopping – but with Kiwis continuing to buy more and more from international stores.


  • 42% of NZ online retail purchases in February were from international merchants
  • Online purchases at offshore merchants were 21% higher than in February 2013
  • Online purchases at domestic sites were just 6% higher than in February 2013

Here’s how the sector has been trending over the last five years:ecom-feb2014

The BNZ report also drills down into exactly which product categories are being purchased from international sites:


No great surprise to see that Furniture is predominantly purchased from Kiwi suppliers: international freight costs for large items remain a significant barrier.

The BNZ reports that:

At domestic merchants, online sales in February were up strongly for Supermarket & Groceries, Other Specialised Food, Department Stores, and Pharmaceuticals & Cosmetics.

[However] domestic online sales of Clothing, Liquor, Electrical Appliances, and sales at specialist Daily Sales sites, were all softer than in February last year.

Why are domestic online retail sales lagging behind?

Yes, relative product costs can be a significant factor — internationally-sourced items offered locally can include margins for the importer, distributer and the retailer, resulting in substantial premiums for “buying locally”. However, as recent research by Sapere (“The value of internet services to New Zealand businesses“, March 2014) suggests, another key factor is local retailers’ reluctance to embrace online sales:

In retail, all our respondents with an online store said it was their fastest growing channel, but (apart from the online-only operators) online was still a small minority of sales. One major chain thought that, despite extensive effort and very large investments, they were still only 1-2% of the way towards the frontier of what was possible.

One service provider suggested that no more than 1 in 12 of New Zealand retailers were really doing a good job of integrating online and offline stores. “The others are just online by default or because they think they have to be, but it is costing them a lot, and it brings new hassles, they have to do it all themselves, and they are not sure whether it will work at all”

Sapere continues:

Retailers are experimenting online but there is still much to do. Internet services are seen as important and effective for marketing and, for a small but growing number of firms, for sales. The competitive impacts of total price transparency enabled by online shopping and competition from online and overseas retailers are evident for retailers operating in some categories. We estimate that a retailer making more extensive use of Internet services is 7% more productive than the average retailer.

The Sapere report included a number of interviews with NZ retailers, sharing their perspective on online retail:

One interviewee said that she foresaw a gloomy future for retailers selling goods exposed to overseas online competition who did not have a strong brand or a point of difference. Bearing this out perhaps, we spoke to a jewellery retailer with a strong point of difference who saw no threat from the Internet. For that business the website and social media were channels for branding and advertising, and a useful addition to the print plus word of mouth model that had prevailed for a long time as the way to get work.

It was not clear in general in what circumstances online retail would add to total sales, whether it would just take share from another competitor or from the offline store, or whether it was additive to sales overall. Some interviewees said that they were just pursuing every angle that they could that might generate more business, and expanding on the things that seemed to work. One interviewee took the view that online sales were not additive at all at the sectoral level, i.e., it was just boosting competition and shifting sales between competitors.

One larger clothing retailer told us that an integrated online/offline/telesales strategy was working, but that it had taken a long time to figure out how to get the different elements to work together rather than competing with each other. This interviewee also said that having an offline store in an area helps to boost online sales in that area: perhaps customers are more confident to shop online if they know that there is an offline store as well.

Another large chain told us that its online store had a clear, material and positive impact on total sales, that customers spent more online than in store, and that this was because the online environment could better meet customer needs, rather than just diverting business from competitors.

One retail service provider was cautiously optimistic about the overall impact of the Internet on retail. “Online is certainly taking away instore sales to some extent, but it is also an opportunity to capture customers who are browsing online. Comparison shopping is now so easy, consumers are price conscious and better informed, but they are willing to purchase online or come in store if they find what they want and they know that you have it.”


Succeeding in Online Retail

All this research leads us to conclude that if the only thing that differentiates you from other retailers selling the same products is your geographic location (eg yours is the only shop in Gore selling these products), you’re going to fail at online retail.

Conversely (and we first made this point in 2005, in our book “Trade Me Success Secrets“), your best opportunity lies in offering unique, personalised items with a high perceived value, so that you’re effectively providing both uniqueness and a great deal.

What was true for Trade Me in 2005 (competing with thousands of other Kiwi sellers) is even more relevant in 2014, when you’re competing with millions of other sellers from around the world.

Location matters — but only if:

  • you know what your local/regional/national customers really want, and give it to them through your customised products and services
  • your delivery times are quicker as a result of being close to your customer
  • your delivery costs are also lower as a result (did you know that free shipping is more attractive than a discount in most cases?)

If you’d like to know more about online retail for New Zealand businesses, check out our Mastering eCommerce course

Click Monday and NZ Online Shopping

Today is Click Monday, the latest attempt to transplant the U.S. notion of CyberMonday to New Zealand soil. As Trade Me’s Mike O’Donnell observed in a recent Stuff column:

This year has seen the [CyberMonday] concept reach New Zealand. Several times over. Three different organisations are having a go at creating a Cyber Monday-like event, and there’s even rumour of a fourth.

The first was held [at the beginning of November] by Nzsale, an Australian-owned member-only online shopping club. Held a good three weeks prior to Thanksgiving weekend, Nzsale staged a “Flash Frenzy“, and billed it optimistically as the biggest online event ever.

The next event to be announced [went] live on 12 November … “Click Madness” is backed by The Warehouse Group and involves special deals from The Warehouse, Noel Leeming, Warehouse Stationery, and

The event closest to actual Thanksgiving in the United States is “Click Monday“, being run by Auckland ecommerce consultant Cate Bryant and Alain Russel of Blackpepper fame.

Click Monday has successfully involved a swathe of big names in the event including Bendon, Icebreaker, Briscoes and Hallensteins. It goes live for 24 hours, starting at 7pm on November 25.

The reason for this flood of Kiwi CyberMonday lookalikes can be summed up in one word: ClickFrenzy. This Australian online shopping event, launched with a bang in 2012, attracted a whole lot of headlines across the ditch last year, not always for the right reasons (the ClickFrenzy website, was down for several hours because of unprecedented traffic volumes, with reportedly 5% of the Australian population, some 2 million users, landing on the Click Frenzy site in the first few minutes):

Perhaps the most serious consumer complaint was simply that the deals on offer didn’t live up to the hype:

  • Following the launch of Click Frenzy, consumers immediately began comparing the ‘deals’ to local and international offers, highlighting the lack of value from some of the ClickFrenzy offers via Facebook. One example is Jamie Olivers 15-minute meals book, on sale for $26.95 via the Click Frenzy site. Customers were quick to respond calling out that the same book is available for less elsewhere (~$15 from the UK and under $25 at BigW and K-mart at a non-sale price). [PWC Digital Pulse]

Despite the negativity, Click Frenzy was repeated in Australia this year (last week), with rather more impressive results reported, including:

  • Online fashion retailer The Iconic smashed previous sales records achieving its first $1m dollar day and doubling sales from last year. It counted more than 200,000 visits during the 24-hour flash sale. (AdNews)
  • [IBM Digital Analytics Benchmark data] showed retail sales were up 16.3 per cent throughout Click Frenzy, which ran for 24 hours from 7pm, Tuesday 19 November 2013, compared to the same period last year. This is despite the fact preliminary figures of 1,061,000 visitors were slightly short of last year’s 1.6 million. (Retailbiz)
  • Traffic spikes during the 24 hour shopathon occurred around 9:30pm and 11:30am as people piled in after dinner, and again during mid-morning breaks. And they were looking for bargains: The average basket spend was down 4% from last year at $131.13. (AdNews)

By all accounts, one of the biggest problems with this year’s ClickFrenzy event was Ambush Marketing, with non-participating retailers attempting to climb on the bandwagon without paying for the privilege:

  • Dick Smith gatecrashes the online sale with Deal Frenzy, JB HiFi has Early Bird Xmas Frenzy, while Kogan is just always in a frenzy. (Channel News)
  • has been issued with a cease-and-desist letter after it hosted a Click Frenzy sale despite not being part of the official event. (Smart Company)

We’re already seeing similar ambushing in New Zealand. For example, even though the Warehouse Group‘s Click Madness event is officially over, there are still deals to be had when one searches for Click Monday:

Similarly, PBTech is serving up CyberMonday Sale advertising to accompany stories about online shopping, with its event starting one hour earlier:

Australian commentator Myles Harris offered up these key learnings from last year’s Click Frenzy:

  • That many Australian E-Tailers are under resourced and did not comprehend the amount of traffic a good deal online can bring.
  • That many Australian retailers view online as an avenue of selling surplus stock. There were a lot of complaints last night that selection was limited and that the store treated it as a dumping ground.
  • Many Australian retailers are not on the ball with online communication streams. Many who were part of Click Frenzy were not active on their Facebook pages or on twitter. Customers certainly loved those who were and directed them to the correct site without having to go through the Click Frenzy site.
  • That if the price is right the people will come. For far too long retail and some Aussie e-tail have not offered any incentive to buy online price wise. The deals are often not good enough or it’s the same price that is in the bricks and mortar stores. While this is an understandable tactic, it certainly does not attract the majority of online shoppers who shop on a global level.

As Click Monday prepares to launch in New Zealand, we wish the organisers well and trust that they and their participating retailers have learned these key lessons from our trans-Tasman neighbours.

Latest New Zealand eCommerce Statistics

Statistics New Zealand has just released the latest Online Shopping figures from the Household Use of Information and Communication Technology report for 2012 — and they make fascinating reading.

Key points:


Yes, 54% of New Zealand’s 2.8 million Internet users (those aged 15 plus who went online in the last twelve months) shopped online and made at least one purchase in 2012.

If we look at individual age groups, those numbers go way up:


Typical online shopping expenditure ranges from twenty to five hundred dollars in a typical month (with a small percentage who spend a lot more):


As Statistics New Zealand notes:

It also seems that what we’re buying is changing. We’re not necessarily buying tangible items; over half of those who shopped online had at least one item delivered electronically. This may include items such as e-books, music, or e-tickets.

Looking at those who had made a purchase in the four weeks before the survey, women outnumbered men in spending a total value of up to $500, while the more expensive purchases predominantly belonged to men.

The number of people spending a total of over $2,000 online has doubled since [the previous survey, i] 2009, to reach 44,000 people in a four-week period.

If you are one of those who aren’t yet offering ecommerce on your website, NOW would be a good time to start. Check out our Mastering eCommerce course.