Technology aids internet sales

If you listen to the retailers association, you could be forgiven for thinking the reason why people are not buying in their stores is 'taxation'. This is utter nonsense, because the most compelling reason for buying online is that:

1. People don't need customer service. These retailers place sales staff in their stores who know nothing about the product, they have a conflict of interest, they are disinterested or under/over-staffed, they are not worth their pay. So why pay a premium for the product.

2. People get better information online. The customer wanting to buy online can visit a number of product reviews, they can purchase on credit cards, often without a credit card payment fee of 3%, they get a wider product range, often for products not available in Australia already, and they don'y pay a premium for new products.

That is not to say that retailers in Australia do not offer advantages. Let us consider their selling points:

1. They are able to offer online products at lower prices because they can buy in bulk.

2. They can offer store credit

3. They can offer in-store product, when many online retailers only offer drop-shipment.

4. They offer an easier sales experience for people who are not internet savvy.

5. They can package a sale, offer after-sales support, etc.

The reality is that most of the competition against the retailers comes from companies which are based in Australia. Most people don't want to buy from companies offshore....they want to know they can recover their money locally, and they want to be assured of product warranty. For this reason, I think a lot of concern is over-rated. The reality however is that Chinese manufacturers are becoming better at service....and they are starting to realise that store reviews will decimate their sales, i.e. A single complaint can kill your sales. That doesn't happen with retailing.

I can see the day when a lot of sordid competition results in retailers or even online competitors engaging in defamatory attacks upon other businesses by diminishing their reputation with false accusations.