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Hitwise Intelligence - Sandra Hanchard - Asia Pacific

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Bricks and Mortar Retailers in Australia are winning the online battle

March 02, 2009

Last week we released our latest Hitwise APAC report, Retail Review Christmas 2008 – Insights for Retail Planning. A key takeout from the report was the significant shift towards Bricks and Mortar Retailers during Christmas 2008, as traditional brands began to leverage online for connecting directly with consumers (Alan first spotted this trend in Australia late last year).

According to Hitwise, visits to Bricks and Mortar Retailers by Australian Internet users attracted year-on-year growth of 19.2% in December 2008, while visits to Online Retailers declined by 7.7%. There are several reasons for this movement: the ‘flight to quality’ or attractiveness of brands that consumers know and trust during an economic downturn; the drop in the Australian dollar; and the improved online marketing performance by some traditional brands. Online is being revisited as a key channel for brands to differentiate themselves against competitors.

Another major trend in 2008 was the heightened importance of post-Christmas sales, which are now occurring over a longer period. Boxing Day remained a key retail opportunity, attracting the most daily visits in 2008 by Australian Internet users. Bricks and Mortar Retailers particularly benefited from traffic on Boxing Day 2008, attracting year-on-year growth in visits of 29%.

Other major findings from the report include:

•Appliances and Electronics is the fastest growing retail category: Appliances and Electronics websites enjoyed the strongest growth in the retail sector over Christmas, with Australian visits increasing by 27.2% amongst all websites comparing December 2007 and December 2008. This growth is underpinned by a significant investment in paid search (see my previous retail update).

•Shoppers hunt for second-hand products during downturn: Australian visits to the Classifieds category increased 24.9% in December 2008 compared to December 2007.

•Top retail brands are increasing their share of the search pie: The top 100 retail brands in December 2008 in Australia grew in search volume by 27.9%, while in New Zealand and Singapore the top brands grew by 21.1% and 10.6% respectively.

•Bricks and Mortar Retailers are attracting affluent shoppers online: Bricks and Mortar Retailers in Australia were 28% more likely than Online Retailers to attract visits from the Mosaic Lifestyle Group, ‘Young Ambition’; Educated and high-earning young singles and sharers in the inner suburbs.

I thought I would also share this Treemap that we presented during our retail webinar last week. In the research team, we’re always on the lookout for different visualisation techniques for Hitwise data. In this case, we found Treemaps particularly effective for communicating dual metrics on a macro level. In the map below, the size of each rectangle represents Australian market share of visits within the Shopping & Classifieds industry. More ‘blue’ rectangles represent sub-categories with high growth, while more ‘orange’ rectangles represent sectors with higher rates of decline.

Click image to enlarge:

This analysis shows that Auctions is by far the largest sub-category within the Hitwise Shopping & Classifieds industry, accounting for over a third of visits in January 2009. Rewards and Directories, which includes comparison shopping websites, accounted for about 10%, highlighting its importance as an affiliate sector. ‘Blue’ or fast moving industries included Appliances and Electronics, Classifieds, Apparel and Accessories, and House and Garden. ‘Orange’ or declining industries included Ticketing and Music.

You can also check out Heather’s retail map in the US. I’d be keen to hear your feedback on Treemaps and any other suggestions you have for data visualisation.

Posted by Sandra Hanchard at 11:23 AM | (0) | (0)
In Categories Shopping and Classifieds