Amazon Online In Australia: Consumers Unimpressed So Far

Amazon is an officially up and running in Australia. The eCommerce giant took its first orders Tuesday, but it seems local retail wasn’t too badly hurt by the development, according to Monday (Dec. 4) reports from CNBC.

In fact, retail stocks actually shot up as complaints rolled in about limited selection and uncompetitive pricing.

The rather chillier-than-expected launch gives all indications that Amazon will have some work to do on both its pricing model and inventory count if it wants to make any real impact on the world’s 12th largest economy. Brick-and-mortar rivals, on the other hand, got to breathe something like a sigh of relief, seemingly safe from the scourge of Amazonian disruption.

For now, anyway. Amazon has never been one to slink away from a challenge.

A closer look at results indicates the eCommerce platform was relatively competitive in terms of pricing with just a few desirable items showing noticeable price differences. For example, an iPhone 7 Plus was selling on Amazon for A$1,345 ($1,027.71) compared with A$1,199 at electronics rival JB HiFi.

“Amazon’s not materially cheaper on a wide basket of items than the retailers,” said Daniel Mueller, portfolio manager at Vertium Asset Management. “The retailers are rallying. It’s a realization that Amazon is not going to kill Australian retail, at least not today.”

Today, online sales account for less than 10 percent of the A$300 billion retail sector. As of right now, Amazon’s first salve has been described as “patchy” by Citi.

“We expect Amazon will not be disruptive to Australian retailers this Christmas,” the company said.

But give it time. There’s always next Christmas, and Amazon’s Australia country manager, Rocco Braeuniger, noted the firm hopes to “earn the trust” of Australian shoppers and create “thousands” of jobs in the coming months and years.