Aussie Bargain Hunters Hurting Retailers
Australian retailers are contending with increased consumer demand for discounts in response to waning wage growth and low housing prices.
In an exclusive report in The Australian, retail industry researcher Power Retail claim only one in three Australians is willing to pay full price.
This follows reports that more consumers are willing to pay for a refurbished smartphone over a brand new device.
Consumers generally check for the best price online before making a purchase and avail of services such as Cash Rewards and ShopBack, discount sites, and pay services like ZipPay to ensure they get the most out of their purchase.
According to Power Retail research, which surveyed 5650 Australian shoppers and retailers, 80% of online shoppers check prices before purchasing.
Furthermore, close to half say they would make immediate purchases if the RRP was discounted by 25% and 90% would purchase immediately if discounted by 50%.
In the report, Power Retail managing director Grant Arnott says the situation is “not sustainable” and “dangerous” for retailers as consumers are only going after the best bargain and not caring about whether businesses make a profit.
“Retailers are having to really focus on how they can differentiate on customer service and loyalty and value add if they can’t afford to do substantial discounts,” Arnott says.
Arnott advised that retailers need to push back in order to remain profitable.
Read the full report here.