Affordability is king for online shoppers, but retailers may be missing the memo, according to research from ShipStation.

With the cost of living still front and centre for many Aussies, it’s no surprise that four out of five online shoppers say affordability matters most when they’re buying online. That’s ahead of things like fast delivery, eco-friendly options or personalised offers, ShipStation’s latest Delivery Benchmark Report reveals.

The report shows 80 per cent of Australians are prioritising price over perks, and that’s driving more people to buy from online marketplaces like Amazon, or overseas platforms such as Temu and Shein. In fact, 62 per cent of shoppers bought from big marketplaces in the past year, and 41 per cent purchased from international brands.

It’s a trend that’s expected to keep growing. Nearly half (49 per cent) of shoppers say they’ll use online marketplaces even more in the year ahead, and 44 per cent plan to shop more with overseas retailers.

Tough times for Aussie retailers

That’s putting pressure on local businesses to stay competitive – and it’s not easy. The majority of Australian retailers (88 per cent) say selling online is getting harder, with 42 per cent admitting they’re struggling to keep up with changing customer trends.

“For many retailers right now, it feels like a race to the bottom to match the low price and speed of overseas retailers such as Temu and Shein,” said David Boyer, VP and Head of ShipStation ANZ. “To compete and keep up, retailers will need to shift their operational strategy and look at how they can find efficiencies that address both the cost pressures and needs for fast delivery.”

Retailers missing the mark

The research also suggests there’s a growing disconnect between what shoppers want and what retailers think they want.

While most retailers (92 per cent) believe sustainability is key to attracting customers, fewer than half (45 per cent) of Aussie shoppers consider it a top priority. And when it comes to delivery speed, just 17 per cent of consumers say it’s important – even though 38 per cent of retailers believe it is.

The majority of shoppers (63 per cent) say they’ve abandoned a purchase due to high shipping fees. And 42 per cent won’t pay extra for faster delivery. Only 3 per cent are willing to fork out more for a sustainable shipping option.

“The research reveals a disconnect between what consumers want and what retailers think they want,” said Boyer. “This gap could be costly for retailers who are already under pressure from losing customers to cheaper overseas competitors.”

Social shopping on the rise

There is some good news for retailers willing to adapt. Social commerce – shopping directly through platforms like Instagram, TikTok and Facebook – is tipped to take off in 2025. Around 73 per cent of Aussie consumers say they plan to shop more on social media this year.

More than half of local retailers (52 per cent) already let customers buy direct from social posts, putting them ahead of their global peers.

“Social media offers a new sales channel for retailers,” said Boyer. “With more consumers planning to shop directly through such platforms in 2025, retailers should assess how they can integrate social commerce into their broader strategy to capture demand and drive growth.”

Trust remains a key factor though – with two-thirds of shoppers saying strong service and a good reputation on social media influence their decision to buy.

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