Australia’s eCommerce landscape has experienced significant growth and transformation in recent years. In 2024, Australians spent approximately AU$69 billion online, marking a 12% increase from the previous year. (ecommerce-report.auspost.com.au) This surge underscores the growing reliance on digital shopping platforms.
Market Overview
Total Online Retail Spend
- Total Spend: AU$69 billion in 2024, a 12% increase year-over-year. (ecommerce-report.auspost.com.au)
- eCommerce Share of Total Retail: Online sales now constitute 16.8% of Australia’s total retail expenditure, up from around 10% pre-pandemic. (paymentscmi.com)
These figures highlight the sustained consumer preference for online shopping even after the height of the pandemic. Retailers that continue to enhance their digital presence stand to benefit from this enduring shift.
Household Participation
Approximately 9.8 million households engaged in online shopping in 2024, marking a 2.3% rise compared to the previous year. (ecommerce-report.auspost.com.au)
This data illustrates that eCommerce is no longer just a trend—it’s a mainstay for the vast majority of Australian households, making it essential for brands to optimise user experience and delivery reliability.
Demographic Trends
Generational Spending Patterns
- Millennials (Gen Y, 27–43 years): AU$22.1 billion
- Gen X (44–59 years): AU$17.5 billion
- Baby Boomers (60–78 years): AU$12.5 billion
- Gen Z (18–26 years): AU$10.6 billion (redsearch.com.au)
While Millennials and Gen X remain the biggest spenders, Baby Boomers are rapidly growing as a digital shopping force. Businesses should cater to the usability and preferences of older demographics while still engaging younger shoppers with mobile-first experiences.
Category Preferences by Generation
- Gen Z: Fashion (23%)
- Gen Y: Home & Garden, Specialty Food & Liquor (23%)
- Gen X: Home & Garden (27%)
- Baby Boomers: Home & Garden (29%) (paymentscmi.com)
Understanding generational preferences can inform inventory, UX design, and targeted ad campaigns. For example, fashion retailers should ensure seamless mobile experiences to match Gen Z’s purchasing habits.
Mobile Commerce Surge
- Smartphones: 77% of site visits, 68% of orders in Q3 2024
- 95% of Australians shopped via mobile in 2024 (redsearch.com.au)
Mobile commerce dominance means your website must be responsive, quick-loading, and easy to navigate. Brands that prioritise mobile UX and checkout optimisation will reduce bounce rates and improve conversions.
Changing Consumer Behaviors
Average Basket Size
- Average spend per order dropped to AU$95, the lowest in a decade (redsearch.com.au)
This suggests budget-conscious consumers are being more selective. To maintain margins, retailers should explore bundling strategies, loyalty programs, and pricing incentives.
Value-Seeking Behavior
- 62% switched brands for better prices (redsearch.com.au)
Shoppers are motivated by value. Highlighting cost savings, offering promotions, and clearly communicating return policies can encourage trust and repeat purchases.
Trust and Loyalty
- 60% remained loyal to trusted brands
- 20% increased purchases from familiar retailers (redsearch.com.au)
Even with a focus on price, trust remains a powerful differentiator. Consistency in quality, service, and communication helps brands retain long-term customers.
Shipping, Delivery & Returns
Delivery Expectations
- 61% are willing to pay for same-day delivery; only 9% of businesses offer it (ecommerce-report.auspost.com.au)
Speed matters more than ever. Retailers should consider partnering with express logistics services or offering local warehousing options to meet fast delivery expectations.
Free Returns Decline
- Free returns dropped from 97% (2018) to 84% (2024), with <20% offering them today (ecommerce-report.auspost.com.au)
While fewer businesses are offering free returns, transparency around return policies is vital. Clear, fair terms can reduce buyer hesitation.
Delivery Costs
- Average delivery cost rose to AU$9.81 in 2024 (ecommerce-report.auspost.com.au)
Inflation and fuel surcharges are impacting logistics. Communicating realistic delivery fees upfront and incentivising larger orders with free shipping thresholds can help balance customer expectations.
Marketing Trends
Digital Marketing Investment
- AU$14.2 billion spent on digital marketing in 2023 (eloquent.com.au)
Businesses should diversify their digital ad strategies across SEO, Google Ads, content marketing, and remarketing to stay competitive.
Retail Media Expenditure
- Forecasted at AU$1.162 billion in 2024, up 28.6% from 2023 (eloquent.com.au)
Retail media (ads on marketplaces and retailer websites) is surging. Participating in these networks can amplify brand visibility during critical shopping moments.
Consumer Engagement Trends
- 58% increased use of loyalty programs
- 95% willing to share data for incentives (eloquent.com.au)
This highlights the value of personalisation. Retailers should collect first-party data to deliver customised offers and messaging through email, SMS, and on-site recommendations.
Delivery Services Landscape
Traditional Couriers
Australia Post, DHL, FedEx, Aramex, and StarTrack remain industry staples for domestic and international logistics. With national coverage, they offer scalability but may lack the speed of new gig-based alternatives.
Gig-Economy Delivery Providers
- Sherpa: 11,000+ drivers; 75% population coverage (ibisworld.com)
- Uber Eats: Expanded to regional SA in 2025, adding $45M to local restaurants and 2,500 delivery jobs (adelaidenow.com.au)
- Drone Deliveries (Wing): Active in SE Queensland, testing autonomous urban delivery (couriermail.com.au)
Retailers can mix traditional and gig-based courier solutions to balance reach and delivery speed. Integrating flexible delivery options during checkout can also improve customer satisfaction.
Top Online Retailers
- Amazon
- eBay
- Kmart
- Temu
- BIG W (paymentscmi.com)
These platforms dominate with aggressive pricing, wide product ranges, and fast shipping. Competing businesses must focus on niche value, customer experience, or brand storytelling to stand out.
Future Outlook
The Australian eCommerce market shows no signs of slowing down. With rising consumer expectations, advancing technology, and evolving competition, staying informed is essential. Businesses that adapt to mobile-first experiences, diversify marketing, and streamline delivery logistics will be best positioned to succeed with eCommerce in the years ahead.
For tailored eCommerce solutions and expert guidance, consider partnering with professionals who understand the intricacies of the Australian market. Fox & Lee are an eCommerce focused agency that achieve great results for our clients. Contact us today for more info.
