The Future of Retail in Australia: How ecommerce businesses can get ahead

What does the future of retail hold for small ecommerce businesses in Australia? This article reveals the biggest retail trends for the year ahead, plus actionable insights on preparing your online business. 

The future of ecommerce is exciting – not only are more consumers shopping online than ever before, but their higher expectations are driving innovation across the industry, from payment and delivery options to new technologies. 

Small ecommerce businesses seeking sales growth opportunities can set themselves up to thrive in 2023 by tapping into opportunities to create the online shopping experience their customers are searching for. 

Here we look at the emerging retail trends and ecommerce statistics for Australia to help small businesses get ready.

Top ecommerce statistics for 2023

Take a look at the latest ecommerce statistics to understand what’s happening in the Australian retail industry:

  • The ecommerce and online shopping industry grew at 23.4% in 2022, compared to the non-food retail market, which grew by 4.3% year on year. (Australia Post 2022 Inside Australian Online Shopping, PDF download)
  • Australia’s ecommerce market is projected to reach over $91 billion in 2025. (GlobalData)
  • The average Australian spends nearly two hours a day on social media sites, and about a quarter of all adult Australians are now making purchases through social media (In the Black)
  • Around 44% of people use Instagram to shop weekly. (Shopify)
  • More than 60% of Australian consumers are willing to pay more for sustainable and ethically made products. (Australia Post 2022 Inside Australian Online Shopping)
  • There are 7 million active Buy Now Pay Later (BNPL) accounts, representing up to 30% of the Australian population. (ABC Online)
  • Australians are leading consumers of BNPL services globally – total transactions were worth AU$16 billion in the 2021-2022 financial year. (ABC)

Trends for the future of ecommerce 


1.    Rise in Buy Now Pay Later options 

With the cost-of-living crisis putting pressure on Australian household incomes, customers are increasingly seeking alternative, flexible ways to pay for goods. 

Online retailers can boost sales by offering financial flexibility through Buy Now Pay Later (BNPL) options.

BNPL arrangements, offered by providers such as AfterPay and Zip, enable customers to shop online and repay the amount over set instalments, typically without interest charges or account fees.

Other flexible payment options are on the rise too. Companies such as AfterPay, Zip, Klarna, Openpay, and Humm now offer a digitised version of the traditional lay-by.
And globally, AliExpress is trialling a new Pay on Delivery service in Germany, France and Spain. This allows customers to pay for their orders after they have been delivered. 

Take action:

The checkout experience is one of the most critical steps in the online sales journey. That means keeping on top of payment trends is crucial if you’re going to grow your online store.

Start offering flexible payment options, including BNPL offerings, Apple Pay, Google Pay, and PayPal, as well as more traditional payment types. 

2.    Green is the new black 

Sustainability is one of the top retail trends you cannot ignore. Customers want to know what brands are doing to help the environment and will actively look for green practices before they open their wallets.  

Even with rising budget concerns, consumers are willing to spend with brands that meet their sustainability values. 
Recent research by Australia Post shows that three in four people look for sustainable options when shopping. People are even willing to compromise on other elements of the shopping experience – more than half (56%) would wait longer for deliveries to reduce their environmental impact. 

Take action:

How can you become more sustainable? 

For customers, recyclable packaging (58%) is the biggest sustainability consideration when shopping online, followed by reusable packaging (37%) and biodegradable packaging (34%). 

This means online business owners should be looking at how to package online purchases more sustainably, such as with recyclable, reusable or biodegradable packaging. 

It can be overwhelming to focus on many changes, so consider one change that will have the most significant impact on your business and start there. For example, you could offer more sustainable packaging for deliveries. 

Always be open with your customers about your sustainability story. Explain what steps you are taking and why, so they can feel good about shopping with you. This will help build loyalty and attract new customers too. 

3.    Faster and more flexible delivery 

Australians can order a takeaway online and receive it within the hour, so why can’t they do the same with other products? 

Customers are demanding more speed and convenience from retailers – nearly 40% of consumers want online orders to arrive in two days, according to research by Loqate. 

Retailers need to move from the traditional delivery experience and explore more innovative ways to provide efficient delivery solutions at every stage in the process. 

This may mean offering more flexible delivery options, such as click & collect and parcel points. Offering the option to collect from the closest parcel point also meets the growing consumer demand for more sustainable deliveries because it reduces the number of delivery vehicles on the road. It also means customers can collect all parcels in one go, eliminating the frustration of multiple delivery attempts. 
Enabling customers to choose the locations of their deliveries facilitates collecting all 
parcels in one go and avoids the need for carbon-intensive multiple delivery attempts.

Providing a better delivery experience also means looking at the checkout process for ways to help speed up the delivery process and ensure a smooth experience. 

Take action:

Add more delivery options to give your customers choice and flexibility. For example, you could offer 24/7 collection points to enable customers to pick up deliveries whenever it suits them. 

Make sure you are creating the best possible delivery experience. One way to do this is to use address validation. This ensures that customers fill in the correct address for delivery so you can reduce delivery errors and provide a smooth and fast shipping experience. You can integrate Loqate with your checkout process to ensure quality data capture is error-free.

4.    Social commerce 

The future of retail is on social media. Retailers have always been eager to meet potential customers where they are, and more customers than ever are on social media platforms. 

But this is about more than using social media to promote your products – it’s about driving ecommerce purchases in the moment.

Rather than sending people from the social media platform to the online store, social commerce is the process of selling products directly on social media without needing to visit the online store. 

For example, whilst scrolling through Instagram, you might see a new jacket, tap Shop Now, add it to your shopping cart and checkout – without ever leaving the app. 
The speed and ease of social commerce are why its popularity continues to rise. In fact, the social commerce industry is expected to reach $2.9 trillion by 2026. 

As you’d expect, Instagram and Facebook lead the way in social commerce functionalities, but other social media sites such as Pinterest, TikTok and Snapchat are expanding their offerings too. 

Take action:

It’s time to embrace social commerce. First, focus on the social media platforms where your ideal customers are spending time, then explore how to create virtual storefronts to attract them. 

Start small by using social commerce for products at lower price points. Social shoppers are unlikely to buy an expensive item on impulse while scrolling, especially if they haven’t bought from your platform before. 

Final thoughts 

The future of retail in Australia presents ecommerce businesses with exciting opportunities. Now it’s down to online store owners to leverage these retail trends to drive sales, increase loyalty and improve their bottom line. 

Online businesses should pay specific attention to upcoming trends in the retail industry, emerging consumer behaviours, and new technologies and solutions that enable them to meet their customers’ demands, whether that’s more payment flexibility, sustainable packaging or new delivery options.

Find out more about how Loqate’s solutions can help your ecommerce business prepare for the future of retail. Speak to one of our product experts today.