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Hitwise Intelligence - Sandra Hanchard - Asia Pacific
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Costco Australia launch - Who is feeling the biggest online impact?
September 07, 2009
The opening of US retailer and membership warehouse club, Costco in Melbourne attracted a healthy amount of fanfare online, with the term “costco” increasing 8-fold during the week ending 22 August 2009, compared to the previous week. The Costco Australia website made a strong debut in the Hitwise Shopping & Classifieds – Department Stores category, ranking at 12th position during the week ending 22 August 2009, behind Kmart Australia at 10th position, but ahead of Myer (at 14th position) and David Jones (16th position).
Commentators have noted that the launch of Costco will affect the whole retail ecosystem here, including large retailers and small businesses. Indeed, the original concept behind Costco was a ‘hypermarket’, a combination of discount supermarket and department store. With this in mind, I thought I would take an early look at Costco’s online competitive traffic to see where consumers were doing the most comparison shopping. Below are the Shopping & Classifieds websites that consumers visited before Costco Australia during August 2009.
ALDI Australia notably featured as the 4th highest Shopping & Classifieds website referring traffic to Costco Australia, with a returning visitor rate of 57.8%. IKEA was another major bricks and mortar retailer sending traffic to Costco, while Officeworks Business Direct represented competition within the B2B space. There were also a number of bargain shopping websites in Costco’s upstream traffic, including OzBargain, Buckscooping (which has a list of Costco prices) and Catch Of The Day – emphasising the appeal of Costco to discount-savvy shoppers.
Costco attracts similar online audience to Myer
An early indication of Costco’s Lifestyle Mosaic profile reveals the highest-representation of visits from multicultural households (“Metro Multiculture”) followed by young families (“Pushing the Boundaries”). Another way of assessing which retailers will potentially compete against Costco is via the Hitwise Lifestyle similarity tool, which profiles websites that attract a similar audience to Costco Australia.
Myer attracted the most similar Mosaic profile to Costco Australia, with a matching index of 0.88 (1 being an identical match). Classifieds websites, Gumtree Melbourne and Cracker also had a similar audience to Costco, underscoring the breadth of Costco’s potential impact on consumer behaviour. As Costco opens more stores and grows in Australia, we’ll be keeping a track of its online performance, particularly within the grocery space leading up to Christmas.
Posted by Sandra Hanchard at 03:38 PM
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Comments
Hi Al,
Thanks for your comment. Further analysis shows that the biggest similarity in audience segments between the two sites are students ("Learners & Earners") which makes sense in terms of Apple's brand, and families with stretched budgets ("Family Challenge"). The latter group is a little more difficult to explain, but suggests that Apple probably has quite a broad appeal, particularly with younger members in the household.
Cheers
Sandra
Posted by Sandra Hanchard | September 10, 2009 03:11 PM
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Sandra,
How do you explain Apple being listing marginally below someone like Myer?
Surely the buying habits of an Apple user, with their higher than normal costs doesn't fit with the Costco profile - if it were Dell, that'd make sense but Apple?
Al.
Posted by Alistair | September 9, 2009 01:32 PM