Health and beauty is one of the strongest online growth industries – and even late adopters of technology are embracing it
Roy Morgan Research has taken a look at online shopping, to find out which consumers are in demographics where takeup of online offers is growing.
While all demographics are recording a positive growth rate, the strongest growth is from the less affluent demographics, it found.
Australians in the FG (lower) Socio-Economic Quintile, those classified as Light Spenders, and those belonging to the Roy Morgan Value Segments “Fairer Deal” (9.5 point increase) and “Something Better” (15 point increase) all recorded higher growth rates of internet shopping between March 2015 and March 2018 than their wealthier counterparts.
And former technophobes are changing their ways: the late adopters of the technology community are also now the highest growing demographic for online shopping.
Referring to Roy Morgan’s Technology Adoption Segments, Technology Traditionalists (those who will only try a new technology when it has become mainstream) recorded a growth of 7 points, while Technophobes grew by 7.1 points, the highest of all segments.
Comparatively, the Technology Early Adopters saw a growth of only 3.9points, and Digital Life (mostly tech-savvy students and young part-time workers) just 4 points.
The strongest growth among late technological adopters was in the Pet Products sector, at 9.6%; but Health and Beauty was not far behind, on 9.6%.
Among Technology Traditionalists, the strongest-growing sectors were Pet Products at 27.1%, Automotive at 25.1% and Baby Products (25%), with Health and Beauty again not far behind, on 21.3$
Roy Morgan pointed out that Health and Beauty was among the strongest online growth industries it reported between March 2015 and March 2018, and each of those industries has a notable proportion of Technology Traditionalists or Technophobes.
“Online shopping has been revolutionising the way we shop for the last two decades, and more and more Australians have begun embracing the convenience, range, ease and value that come with it,” says Roy Morgan CEO Michele Levine.
“As technology becomes more readily available and easy to use, and as industry giants such as Amazon begin catering to the local Australian market, it’s predicted that an even greater share of the market will find itself being traded online.”
This trend in the growth of online shopping demographics is very significant, she says.
“Those demographics which have less disposable income, those who consider themselves light spenders and those who shy from new technology are the strongest growing segments.
“This may be surprising for some; wouldn’t those with more money to spend be flocking to online shopping? The truth of the matter is, they already have. 80.1% of people in the highest income quintile purchased at least one product online in an average three months, as well as 83% of technology early adopters.
“Historically, they’ve been the ones at the front of the online shopping movement, with the technology and dollars to take advantage of being able to buy just about anything with a few clicks.
“Now, however, the waters have been tested, the process refined, and the warehouses are starting to become local. Previous barriers to entry for lower income demographics have been broken down as the cost of technology has become reasonable and shipping, mostly from America or parts of Asia, has fallen as large retail giants move in on the Australian market.
“As well as this, devices with intrinsic internet usage and websites with comprehensive user interfaces allow the technophobes of the market an easier passage into online shopping.
“These changes are being seen in the growth of markets where these types of customers are prevalent.
“Health and Beauty has grown by 34.4% and Pet Products by 55.1%, no doubt fuelled in part by increased online participation by the Technology Traditionalists and Technophobes.
“It has never been more important to understand your customers.”