Financial review - Distribution wins return sales online

Financial review
Tuesday, 16 July, 2013

Heavy investments in glittering websites with dazzling branding and attractive price discounts are being made by a flood of online retailers, as they attempt to steal a bigger share of the $225 billion spent by Australian consumers in the retail sector each year.

But the headlong rush for new customers through keen pricing, an advertising and marketing blitz and new technology has some eerie similarities with the dotcom boom of 1999, which had popped so spectacularly by 2001.

“Everyone’s drinking the Kool-Aid a bit too liberally, but you’ve also got to think about retention,” said Paul Greenberg, a co-founder of the DealsDirect Group in 2004 and one of the pioneers of Australia’s online retailing industry. “The battleground has shifted to the supply chain,” he says.