Kiwis spent $4.7 billion online last year

Kiwis spent 4% more on online goods and services in 2015 than they did in the previous year, taking the amount to $4.7 billion, according to Nielsen.

And the money is increasingly going toward international retailers’ pockets, data from BNZ suggests.

Nielsen is expecting the number of online shoppers in New Zealand to increase to more than 2.1 million this year.

“While growth has steadied over the past year, the market has grown by an exceptional 28% since 2012,” Nielsen research director Tony Boyte says.

The research firm says convenience, price, value and range are the most frequently cited reasons for shopping online.

Nielsen says online shopping is dominated by five major categories: airline tickets, fashion, entertainment, accommodation and books.

Trade Me [NZX: TME] is the top brand, with 44% buying from the website. The auction site is followed by Air New Zealand [NZX: AIR], The Warehouse [NZX: WHS], Mighty Ape and GrabOne.

The BNZ and Marketview monthly report for May says online retail sales at local sites increased 15% on the same month last year, which is well above the 3.6% growth in physical stores (based on Statistics NZ figures for electronic card transactions for core retail excluding hospitality).

The increase in online purchases at offshore sites was slightly behind at 13% growth.

However, international sales are fast catching up to domestic, with the gap increasingly closing since 2012.

BNZ institutional research director Gary Baker says it will be interesting to see if Kiwis make more purchases from UK retailers in June because of a weaker pound due to Brexit (see UK e-commerce giant crashes as pound plummets).

Nielsen’s Mr Boyte says online retailers should be optimising their mobile offerings to stand out.

“Building trust and confidence in mobile device shopping and payment experience is critical. The prize of being able to ‘talk’ to consumers one-on-one, including location marketing is a strategy that will also push retailers into strengthening their mobile proposition,” he says.

“Providing a great delivery service is a differentiating factor that will give an edge to e-retailers over their competitors. Nearly a third of the main reasons for not shopping online are related to delivery concerns – the foremost being cost.”

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