But shoppers expect more.
Amazon’s pared back version of its Prime subscription service launched earlier this year left many consumers wanting, according to Starcom research. This resulted in a slowdown in uptake of the membership service in Australia, limiting the speed of growth for the online retailer.
The research found that although ‘Prime Day’ created excitement, shaped by experience with Amazon.com and awareness of Prime benefits offered in the US, it left an ‘expectation gap’ among Australian consumers. Starcom has been investigating Amazon’s entry into Australia for more than a year with initial research revealing that despite Amazon proclaiming Amazon.com.au as its most successful international launch ever, many Australian consumers were left feeling disappointed.
Starcom’s view is that Amazon will need to bring a US-style Prime offer to Australia in order to drive Prime membership to a significant degree, and by doing so accelerate growth that significantly impacts Australian retail.
However, it was important not to jump to conclusions. In the digital age, it is more tempting than ever to take a short-term view, to elevate the importance of immediate consumer actions above long term brand building, Starcom research director, Nicole Conroy, said.
“By investigating the human response to Prime Day, Starcom believes we’ve built a more complete picture of Amazon’s likely impact in the long term. Our research has found that Australians are increasingly positive towards Amazon, are thinking differently about Amazon and visit the site with a shopping mission in mind. It is the online shopping experience however, and the reduced Prime Australia offering, that are holding back Amazon’s growth here.”
According to the research 88% of social media mentions about Prime were positive during June/July; positive social sentiment towards Amazon increased from 62% prior to the Prime launch to 72% post Prime Day; leading into Prime Day 2018, Australians were primarily searching Amazon for gaming consoles, sportswear and mobile phones, indicating an increasingly strong association between Amazon and these categories.
Hitwise data showed that conversions on Amazon.com.au – visits that lead to onsite purchases – averaged at 7.77%, prior to Prime Day, a strong figure, placing Amazon ahead of all other online retailers in Australia.
Although Prime Day created excitement, the Prime experience in Australia is missing some of the most compelling benefits offered in the US, such as Prime Music, Prime Photo, the number of items eligible for free delivery, Amazon Key in-home and in-car delivery and family discounts, Conroy said. “This creates an ‘Expectation Gap’ which deters the majority of Australians from joining Prime, despite the low price.”