Expectations beyond reality.
Following the release of Harvey Norman’s half-year results, Gerry Harvey has spoken to Appliance Retailer about the hype of online sales growth and the influence Amazon will have on the local market.
Harvey said about seven years ago, online sales were just 1% of the retailer’s total sales and the company expected that number to grow to 15% or 20% over the next five years. “The expectation of what it would be was much higher than what the actual was. The hype around the potential of online builds expectations beyond reality. We have seen good growth in online sales but it still only represents around 3% of our total sales.
“Ahead of Amazon’s launch in Australia, there was hype that businesses would go broke and Amazon would take a huge share of the market but when Amazon opened it sold nothing much and it just turned into a fizzer overnight.”
Harvey says Amazon couldn’t possibly live up to what people were expecting or hoping. “But from Amazon’s point of view, they never said what they were going to; it was just the media and analysts, who all made themselves out to be silly.”
Harvey also said he has not seen any direct impact from other online players such as Kogan.