Will manufacturers steal the online show?

By Keri Algar

SYDNEY, NSW: Harvey Norman and Myer have floated the idea of opening their own China-based online sales stores, however, new research has revealed their strategy could be undermined by trends in online shopper's behaviour. 

Of the 17 categories measured, the proportion of Australians who were interested in buying goods directly from the manufacturer was highest for computers and hardware (55 per cent), travel (60 per cent), appliances (50 per cent), and mobile devices (50 per cent), according to the Taylor Nelson Sofres survey.

The survey’s director, Jonathan Sinton, said retailers need to be cautious when moving into online retail, particularly in categories where consumers are already accustomed to buying direct from the manufacturer such as computers and electrical equipment.

“Australian retailers venturing into online retailing need to proceed with caution as many big brands such as Country Road, Sony and Tiffany are offering better deals, exclusive products and customisation options via their own stores,” said Sinton.

“Brands don’t necessarily need retailers online, with brands able to close the loop and reach anyone, at any time. The travel industry went through this change 10 years ago, when the airlines started selling direct to the consumer.”

39 per cent of respondents said they were interested in buying products from stores embedded within Facebook.

“With consumers spending so much time on social media, it makes sense for brands to try to sell — rather than just influence — on Facebook.”

“You can already embed an entire store within Facebook, and consumers have shown they’re keen to buy through social networks, with brands such as Dell having been successful in capitalising on this.

“We should expect more changes to the online retail environment at the hands of social media in coming years, with Facebook Deals, Facebook Connect and group buying sites integrating retail with our social communities.

“Ultimately, success in online retailing will come down to understanding the purchase cycle, identifying the key points of influence and making an effort to dominate these.”

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