Google exec says Aussie retailers adapted well to Amazon entry


Local retailers have so far withstood the impact of Amazon’s heavily hyped arrival in Australia. But Ms Conroy tipped a long road ahead for many stores as the $US906 billion ($1.3 trillion) behemoth increased its warehousing productivity and optimised its distribution model.

Amazon CEO Jeff Bezos. Credit:Emmanuel Dunand

“Amazon, I think if you ask them, will say they’re just getting started here. I think it will be a long journey for a lot of retailers,” she said.

“You’ve seen a lot of announcements from Australian retailers that they’re investing in their warehousing, putting robots into their warehouses to do things like picking and packing. I think some of that is because they know Amazon are continuing to invest in that area, so they’re gearing up to compete.”

Physical stores and human workers may prove to be competitive advantage, according to Ms Conroy, particularly for those with online and in-store offerings.

While around 10 per cent of all retail shopping is online, most in-store shopping is “online-influenced”, according to Ms Conroy, where shoppers, for example, research a product online then go into a store to ask further questions or test the product.

Amazon, I think if you ask them, will say they’re just getting started here. I think it will be a long journey for a lot of retailers

Blending online and in-store experiences, and ensuring stores’ online offering accurately reflects its in-store offering, will be key to retailers’ ability to compete with Amazon, said Mr Conroy.

Department stores like Myer have been forced to improve their e-retail offering.

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Myer is hoping to double the share of online sales to 20 per cent over the next five years. Its online sales grew 18 per cent in the first half of this financial year after it launched a new website.

Myer’s omni-operations manager, Lee Ashton, said a knock on the door from Google’s online retail department forced the company to confront the poor state of its e-commerce business.

“We lived through the Google-visit. We had Google come in and mark our homework give us feedback,” said Mr Ashton.

“It was a real wake-up call for us – what it really highlighted was how poor we were at handling our stock … [and] whether [stock] was priced appropriately. It was a real opportunity for us to reflect on someone coming into our business and saying ‘we can’t find a product'”.

Paul is a reporter for The Age.

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