Expanding into new Amazon marketplaces around the world is one of the best ways to increase your revenue from Amazon sales. We’ve talked in past about expanding into Europe, that’s one of the first places to look at moving into beyond North America. Japan is also a good one to look at. But what about Australia?
Amazon Australia launched in December 2017, with very little fanfare, it just suddenly popped into existence. Since then the Marketplace has grown.
In this episode, we’re talking about the Australian Marketplace. We’ll cover basics, along with logistical issues you’ll need to work out. Plus, should you be selling there?
“Clearly Amazon doesn’t do things for the sake of doing it. It’s not an exercise, it is strategic and so they have clearly crunched numbers,” says former Amazonian Peter Kearns.
Peter’s job at Amazon was to identify holes in the Amazon catalog and then find sellers to fill those holes. Now he’s the Vice President of Client Solutions for 180Commerce. He’s also been looking into Amazon Australia.
There are several thousand sellers using the Australian Marketplace now and about 55 sellers are jumping on each day, but there are some big hurdles sellers need to figure out in order to compete there. The first one hurdle: Fulfillment by Amazon doesn’t exist.
“I would suspect that they are trying to get FBA launched as fast as possible because it results in the best possible customer experience,” Peter says.
So before you list anything on Amazon.com.au, you need to figure out several things.
- How do you get your products to Australia?
- Where do you store them in Australia?
- How do you get them to customers?
“That’s definitely going to be a problem and it could get worse before it gets better as more people get on and more customers are shopping from it,” Peter says.
Amazon FBA in Australia is coming. It’s just not ready yet. There’s another thing that’s frustrating for sellers and customers. Reviews have been ported over for ASINs, but the review count and star rating doesn’t show up in the search results.
“Customers can read the reviews on the detail page but they’re not showing up where it counts, they’re not seeing that four out of five stars above the search results,” Peter says.
It might seem bizarre that Amazon would launch without having all these issues sorted out, but it actually fits in with one of their principles. Bias for action. That basically means that they will launch something quickly and complete it as they’re going.
“They do this all the time. It’s not necessarily a bad thing but some sellers and customers don’t always understand that Amazon culture and philosophy and it kind of can be hard for them to adjust to,” Peter says.
Now, with all that in mind, Amazon wouldn’t launch in Australia if it wasn’t a good opportunity.
In general, e-Commerce hasn’t totally taken off in Australia like it has in the United States. Australians haven’t widely adopted marketplaces, they prefer to buy directly from the brand. However, eBay has been popular there.
“So what does that say about it, is it more unique items, collectibles sort of stuff which eBay is known for so I think it’s a very different dynamic,” Peter says.
Another thing to keep in mind is the size of the Australian economy versus the United States’ economy. Last year, Australians spent only about $1,700 online per person. Contrast that with Americans who spent an average $4,200 online in 2017.
Now Australia does have a smaller population than the U.S., 24 million to the U.S.’ 325 million – so that also plays a factor –
“Amazon has so much traffic going to the U.S. because the U.S. has a significantly larger population than Australia,” Peter says.
If you’re wanting to explore the possibility of launching on the Australian Marketplace. I suggest you browse the website, you can find it at amazon.com.au. Search for products you would normally purchase, you’ll be able to see that the Marketplace isn’t fully up to speed compared to the North American Marketplace. At least not yet.
Still, that’s not stopping plenty of sellers are seizing the opportunity, but keep in mind, the marketplace idea hasn’t been fully adopted by Australians. eBay has been popular so that information has to be factored into your decision of whether or not you sell on that Marketplace.
The Australian Marketplace is perfect for sellers creating their own products and building their own brands.
“I think it makes a lot of sense where they’re doing a really good job creating a brand on Amazon. Where you are truly looking at the market and saying there is a gap in the market and this product fills that gap,” says Peter, “You’re creating a brand following that resonates with the customer base there.”
The Australian Marketplace is not a good fit for sellers doing retail arbitrage or creating private label products. Shoppers in Australia just aren’t ready for that.
So just because you’re successful on the U.S. Marketplace doesn’t mean you’ll automatically be successful on the Australian Marketplace. Keep it in mind it might be something you decide you want to branch into in the future. Right now, if you have your Amazon business running great, look to going into Europe first.
Thanks to Peter Kearns for his insight on Amazon Australia and the information he’s shared with us. If you’d like Peter’s help with your Amazon business you can find Peter at 180commerce.com.