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Australia: Cross-border selling opportunity for US brands

Australia is an important trade partner for the United States. Of the total imports, China is the most significant (29%), followed by the US (11%) and Japan (6.3%). The same applies to cross-border online sales, as shown in the following graph. The US is second with a share of 28%, putting it ahead of the UK and behind China. 

In 2021, it remained similar in terms of the top countries where Australians bought the most online, China with 30.1%, the USA with 22.5% and New Zealand with 4.7%. This means that the US continues to be a strong player in cross-border e-commerce in Australia, allowing US brands to enter the Australian market successfully.  

For this reason, we are discussing different market & economy overviews, digital overviews, e-commerce outlook, and how BorderGuru can help your brand expand into a country full of opportunities for your fashion Shopify store to increase international sales.  

Population & economy overview 

Australia has a population of 26.14 million. The most populous cities are Sydney, Melbourne, Brisbane and Perth. The median age is 37.5 years, and the largest age group in percentage is people between 25 and 54 years (41.15%), as can be seen in the image below: 

 

The official language is English, and the currency is the Australian dollar. The exchange rate is approx. 1 USD = 1.38 AUD.   

Regarding the economy, Australia ranks 13th among the largest economies in the world. With a GDP per capita of $51,885 and a Purchasing Power Parity (PPP) of $ 1.31 trillion. Australia’s economy has become stronger after the pandemic, and GDP is expected to grow by 6.6%  by the end of 2022. The International Monetary Fund (IMF) predicted that Australia would move up one place to be the 12th largest economy in 2023. 

Digital Overview 

Australia is a very digital market like Canada, as our previous blog, Canada: Cross-Border Selling Opportunity for US Brands,” shows. Australia has many Internet users. As seen in the image below, 90% of the population, just under 5% of Canada, has access to the Internet. It is also essential to be aware of the percentage of mobile Internet users, as it accounts for more than 50% of the population. Your website must provide a mobile-optimized experience, and the content must be suitable for mobile phones to further capitalize on this market.   

Regarding social media, there were 21.45 million users in January 2022, representing 82.7 percent of the total population; this is many users who can become potential customers for your brand. The following image shows the number of users per social network. With this information and knowing your specific target market, you can get an idea of where it is best to promote your brand to attract Australian consumers and increase your sales.   

According to Statista, in 2021, the most popular online activities of adult Internet users in Australia were e-mail 98%, web browsing 96%, banking 92%, watching videos 90%, access to news 85% and online shopping 85%. This means that shopping is one of the top online activities as e-commerce sales continue to grow. As we will see next, “E-commerce Outlook.” 

E-commerce outlook 

As e-commerce sales are on the rise worldwide, Australia is in the same boat as online sales increased by 15% in 2021. The same year, Australia’s online sales totaled 31 billion US dollars, placing it ahead of Russia and Canada.   

According to Australia Post’s E-commerce Industry Report, online purchase frequency increased by 112% in 2021, from 1.6 million in 2019 to 3.4 million. Over 80% of Australian households made online purchases in the same year.   

In 2021, the top 5 categories purchased through e-commerce (local and foreign brands) were fashion products (72%), groceries (54%), takeaways (54%), beauty (45%) and electronics (43%).   

Not only are Australians buying more online vs offline, but they also buy more from foreign brands. In 2021, cross-border purchases increased more than domestic purchases, 5.32%, compared to 4.07%. And the top categories of cross-border e-commerce were: 

 

                                                

As seen at the beginning of this blog, the US is a strong player in cross-border e-commerce in Australia, after China is one of the countries where Australians buy the most products. This shows that more US brands in the trendy categories will successfully enter this market. 

Here are the top reasons Australians continue to buy online after the pandemic. This information comes from the Interactive Advertising Bureau Australia (IAB). 

  • Convenience – 76% 
  • Free delivery – 50% 
  • Lower prices – 45% 
  • Discounts – 37% 
  • More product options 33% 
  • Fast shipping – 26% 
  • Finding certain products/ brands – 25% 
  • Products only sold online – 25% 
  • Safety (avoid public places) – 20% 
  • Free returns – 13% 
  • Find new brands – 11% 
  • Reviews from other customers – 10% 

It is essential to be aware of these reasons, so you can provide the products and experience that the Australian market wants and expects from online stores. 

How can your brand expand to Australia without hurdles?  

BorderGuru can help your Shopify store to achieve a smooth and successful expansion into Australia by providing you with a full cross-border service, from legal compliance and competitive shipping costs to customs-clear orders. Process all international orders like any other domestic sale without investment or changes in your daily operations. Offer your customers the best online shopping and shipping experience. With BorderGuru, your customers will never have to deal with additional fees at delivery time. 

 Are you ready for the next step of your international expansion? Contact us now and start your global journey with us.   

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