- Amazon, you must have heard of them by now.
They're the global online retail
that in 2017, turned over
$177 billion and as of now is valued
at close to one trillion dollars.
They're a massive success in the U.S., Japan, U.K., and AU.
But what have Amazon in Australia done wrong?
And what should you buy from them if you are Aussie?
The answers might shock you.
(cheerful music)
So a quick tour on the website shows
that it's functional, clean, and serves
what you want to see.
But let's be real, pricing.
Amazon usually have the best prices
and the service is simple, quick, and super easy to fix
if you come into problems.
But back to that price factor,
it is ultimately the make or break.
Take for example, this GTX 1080 Strix.
Comes in at 855 Australian dollars including delivery
which is more expensive than all local Australian retailers
which are selling around $850 max
and that's in your hands right then and there,
meaning the other retailers have the item actually in stock,
not to mention in the U.S. it's 530 U.S. dollars
or 726 Aussie equivalent dollars.
On top of the price, there is also
a three week delivery time
but if you want cheaper parts at the cost of shipping time,
you can get the same GTX 1080 Strix for 799 with shipping
within the week.
I've even seen those prices drop as low
as 730 Aussie with recent Ebay sales
and let's pause right there.
Ebay, they've been dominating Australia
for quite a while now where in 2017,
they had total online sales of roughly
4.64% of Australia total retail trade.
That's all trade and in Australia alone
made six and a half billion dollars in total revenue
which is over 53% of total online trade excluding food.
They constantly have five, 10, or even 20% coupon codes
that brings cost of popular electronics down
under that of even most volume orientated
Australian retails and sometimes even beating
that of U.S. prices.
So, it seems that Ebay is determined
not to let Amazon even get a foot in the door, so to speak,
when it comes to the promised Aussie land of the consumer.
Now you'll probably be asking yourself,
if prices are higher and I have to wait three weeks
for shipping, then what's the point of even using Amazon?
Well for those items in particular,
I think it's a clear miss.
But if surprisingly the savings start to come into play
when you look for the small things
that you would usually go and pay full price for.
One example of this is video games.
But let's say you're a console player.
God forbid, give and bless my soul,
but let's say you wanna buy some physical games.
Normally without thinking you would go to the store
like JB Hi-Fi, Harvey Norman, EB Games,
or maybe even Big W if that tickles your fancy.
You wouldn't normally consider buying physical media online
otherwise you might as well just buy
an online version, right?
Wrong.
Take for instance Gran Turismo on the PS4 for example.
EB Games being the most expensive at $100.
Ebay coming in at second with $29,
and Havey Norman, Big W, and JB Hi-Fi all coming
in around 24, 25 bucks.
Now let's quickly check Amazon Australia.
Wait no, that can't be right.
12 bucks with free, three-day shipping
from the official Amazon AU store.
Now, there is a deal.
Let's give it the benefit of the doubt.
Let's see Detroit Become Human, $100.
54, 49, and here comes Amazon at $44.
Marvel Spider-Man, $100 pick up, 79 pick up,
79 pick up, 77 posted, and Amazon in again
with the best price of $69 shipped.
Okay, so games are definitely cheaper.
But what about he consoles themselves?
PS4 slim, one terabyte black, no games, no flash,
one day Ebay sales, EB 509, JB and Big W 479.
Now Amazon at $459.
Whoa, oh my God, so cheap.
Be quick or they might sell out quickly.
It's a console, right?
Now I haven't included Ebay in these sales
because Sony don't have an official store there
so you'll have to wait for a resaler
which may not get you the best price on a new system.
There are other things that are certainly
coming in cheaper than retailers too.
Buy DVDs and keyboards and also say this G502 mouse.
So the deals are definitely there.
The postage time is definitely there for some things
but how is it that the Sydney Morning Herald
reported that Amazon Australia ran at an estimated
8.9 million dollar loss in 2017?
We can definitely see the limitations of Amazon Australia.
When they are shipping from Amazon U.S.,
like the Threadripper 2990WX, of course
they won't have stock just sitting around in Australia,
but that right there is the problem
because now Amazon have a similar price
to the Aussie retailers that include $510 of import tax
and $20 shipping and that will take
four weeks to get to you.
Clearly not worth it.
But at the same time, I think the biggest part
of Amazon's flop so far in Australia
is that the lack of clear marketing
showing people that they can get great deals
with express shipping to their door
but also partnering with local retailers
to have all bases covered when it comes to having
decent priced items on pretty much any item you can think of
and for me personally, this is what I think gets me,
I don't wanna check a site and waste time
if they are continually going to be hit and miss.
If I go on Ebay on the flip side,
I know I'm going to usually get either the best price
or somewhere near the best price
and this is a huge factor that Amazon has to consider
if they want people to continually come back to their site,
that is, they have to build loyalty.
Though another problem still exists here as well
and that is the Aussie consumer.
We're just like any other country's resident
is to someone else, different.
Aussies love a good bargain
and even if it's not a super, oh my God,
clear out bargain, I have to get this now,
we still like to think that we are getting
some kind of discount no matter how small it is.
So, Ebay definitely catered to this craving
and they have the market, as we say, down pat.
Though going forward for Amazon,
I don't think we're at this point where you can order
food with same day delivery
nor can we do that on Ebay really,
well, not that you'd want to either.
To be honest, I haven't tried it yet
but I guess I just prefer my food local.
But of course for other items that a lot of Aussies
would otherwise want, Amazon still seems to be
just too hit and miss and in an age of digital perfection,
anything less just won't suffice.
So going forward from here, it is pretty clear that
Amazon have a really tough road ahead of them
competing with Ebay in Australia.
Ebay have gained not just the loyalty for auctions
but also for Buy It Now and making digital stores
come to their marketplace to really have established
a trust relationship with the consumer
that's going to be really hard for Amazon to beat.
But if Amazon do want to compete,
then they really, in my opinion,
have to get the consistency right.
Anyway, I hope you enjoyed today's video.
If you did then be sure to hit that like button
and let us know in the comment section below,
why do you think Amazon's having a tough time in Australia?
As always, love reading your thoughts and opinions
and I'll catch you in another tech video very soon.
Peace out for now, bye.