Market Trends of Australia Payments Industry
This section covers the major market trends shaping the Australia Payments Market according to our research experts:
E-Commerce Segment is Anticipated to Witness Significant Growth
According to Australia Post, the home and garden e-commerce segment grew 37 % year over year in July 2021 compared to January the prior year. Food and beverage, as well as hobbies and recreation, grew by more than 30%.
According to National Australia Bank, Domestic merchants' online retail expenditure in the department shops category climbed by 51.1% in August 2021 in Australia, compared to the previous year. In this area, international merchants grew at a pace of 33.3%.
The importance of regulation in shaping digital commerce in the region will become increasingly crucial. As open banking takes off in Australia, the country has become a cross-border payment hub in real-time. In mid-2021, the Federal Government proposed financial market infrastructure (FMI) reforms, which the Reserve Bank of Australia's Payment Systems Board applauded. These are a slew of efforts, disruptive technologies, and services to make real-time cross-border transactions more accessible.
Selling in-store and online through several channels - e-commerce websites, Amazon, eBay, Instagram, and so on - to create a smooth experience and consistent brand messaging across all touchpoints is called omnichannel commerce. Creating an omnichannel experience, on the other hand, is about meeting customers where they are and making it easy for them to buy. As a result, mobile devices are a perfect medium for omnichannel commerce, as most customers carry their cellphones with them at all times.
During the COVID-19 epidemic, mobile commerce promotion and sales have increased. Brands shifted to video technologies like FaceTime for consultations and Instagram Stories for product inquiries. Shoppable postings have also been deployed across social media channels to take advantage of consumers at home and online. These tendencies will drive the market under study.
Growing Inclination Towards Purchasing Online is Driving the Market
According to the Australian Bureau of Statistics, in September 2021, the share of online sales in total retailing in Australia was roughly 15.3%, the highest proportion of online sales during the Feb 2020-Sep 2021. Food retailing's share of online sales declined from 7.4 % in 2020 to 7.2 % in 2021; however, online food sales were still larger than at the end of 2020(4.5%).
According to a new survey by Marqeta, Australian consumers are at the vanguard of mobile wallet use and acceptance of digital banking tools, leaving cash and physical payment experiences in more significant numbers than consumers in the United States or the United Kingdom. The 2022 State of Consumer Money Movement study by Marqeta surveyed 4,076 people across three continents, including over 1,000 in Australia, to find out how people in the United States, the United Kingdom, and Australia want to pay, bank, and shop.
Furthermore, according to the survey, 69% of Australians said they felt secure enough using a mobile wallet to leave their physical wallet at home, 23% more than the number of Americans who said the same. Mobile wallets received higher grades for convenience (90 %) than other survey respondents, and more Australians indicated they could make mobile payments anywhere they wished (86% ).
According to Contevo, with more than half of Australians having at least one BNPL account, most shops now offer various Buy Now Pay Later (BNPL) choices to cater to diverse demographics. It's also critical for retailers to offer PayPal and credit card services that accept currencies that customers want to use. Consumer shopping habits have changed, and online orders have increased, forcing Australian Post and other carriers to scale and adapt swiftly. Late-night and weekend deliveries will become the norm for the majority of 2020. Increased lead times can negatively influence the customer experience, forcing purchasers to hunt for better service elsewhere.
The rise and change in consumer preferences and companies' different approaches to capturing wide market space will create an opportunity for online sales to grow. For instance, the growth of Click & Collect orders indicates that more people are pre-purchasing things and spending less time in stores. Providing a smooth and seamless Click & Collect program will aid the growth of the companies.
