Bounceback: Online spending doubles as retailers reach new markets

Apt Collections manager Heather Davis says establishing a website after lockdown had been a worthwhile endeavour. Photo / Andrew Warner

Domestic online spending has doubled compared with a year ago - and selling online has been what has saved many local retailers from going bust since lockdown.

Retail NZ also projects national online spending to reach a whopping $8 billion over the next 12 months - up from $4.2b in 2018.

The news follows NZME reporting on August 22 that NZ Post's new e-Commerce Spotlight report showed online shopping in the Bay jumped 49 per cent during April, May and June 2020 compared to last year - and people spent more than $92 million during three months.

Some locals retailers have been buoyed by the better-than-expected bounce back, saying they have received strong support nationwide as Kiwis take the call to shop locally seriously.

Retail NZ chief executive Greg Harford said online sales had doubled compared with this time last year.

"We're looking at about 18 per cent of retail spending being done online, compared to about 9 per cent this time last year.

"That is spending to all websites worldwide but we suspect a lot of that growth will be to domestic stores as we continue to push Kiwis to shop locally and shipping delays from international stores have resulted in poor customer experiences.

Greg Harford, chief executive of Retail NZ. Photo / Supplied

"In the immediate aftermath of the first lockdown, online sales saw massive increases."

Harford said while online sales had scaled down after the initial boost, there would be people who tried online shopping for the first time during lockdown who found it easy and would continue to shop online moving forward.

While the downside of this, he said, would be a contraction of retail activity in "brick and mortar stores" reports from retailers were generally positive.

"Retailers are still seeing an increase of sales online and for some, their website has created a shop front and is driving foot traffic into the physical store as well.

"There will have been a number of businesses that would have been tipped over the edge if they weren't able to service customers online during level 3.

"Our advice to customers is to deal only with reputable businesses and shop local to keep people in jobs and keep the economy ticking over."

Rotorua women's apparel store Bossy B has been building their online brand for years but it has taken off since lockdown.

Owner Linda Bell said as a regional retailer, the website had been an ongoing focus.

"We've been building our online presence for a long time but lockdown really pushed it to another level.

"It wasn't an overnight thing but we couldn't have survived this time if it weren't for our website.

"People have been really supportive and engaged with our content. We started doing videos after lockdown and they're getting and some are getting more than 12,000 views."

She suspected the increase in online sales came as a lot of people were unable to travel so were spending their money locally.

Marketing manager Michael Bell estimated online sales had increased by a third since lockdown.

Apt Collections manager Heather Davis says establishing a website after lockdown had been a worthwhile endeavour. Photo / Andrew Warner

Apt Collections in Rotorua set up their website just after lockdown. Manager Heather Davis said the decision had been the right one.

"We didn't have a website before because we are owned by a wholesaler and they didn't want to step on other retailers' toes. Lockdown really forced their hand but it has been well worth it.

"People are ordering from everywhere, the website has been doing really well.

"When we came out of lockdown we knew it was going to go one of two ways - either it would be dead because people had no money to spend or we'd pick up because the people who normally would go overseas were homebound.

"We've been lucky that when the Government told people to go spend, people have listened and are spending at local stores and websites."

Bethlehem Butchery owner Ben Taylor said it would not have been worthwhile opening the store during alert levels 3 and 4 if they hadn't set up the website.

He said people had been asking about delivery services and click and collect prior to lockdown and he had been in the process of setting up a website when the country went to alert level 4 in March.

Since then, Taylor said online demand had been fluctuating with the country's alert levels.

"People still prefer to come into the store, but when we go up alert levels, our customers are able to still order through the website.

"We're also finding people are looking us up online and then coming in store so the website has been a good marketing tool as well.

"We had one guy come in who lives in Ohope. He found us online, liked what he saw so drove all the way up to see us. It goes to show people will be willing to travel for a good quality product."

Tauranga Chamber of Commerce chief executive Matt Cowley. Photo / File

Tauranga Chamber of Commerce chief executive Matt Cowley said a boost in online sales meant, for many Bay retailers, their customer base was no longer limited by geography.

"There are some boutique shops in Tauranga that are getting more brand recognition and are reaching a wider customer base than before because they're investing in their online presence.

"The downside to this is that there are retailers in other regions doing the same thing and are stealing local buyers so the competition has also increased exponentially."

Despite this, Cowley said business confidence in the city was positive.

"With everyone back at alert level 2, we're reasonably back to normal and retailers are gearing up for a good Christmas and summer spending season.

"With the knowledge we could potentially go back into alert level 3 in the next 18 months, local retailers are preparing to be more resilient and will still be able to operate with a solid online presence."