Affordable fashion sales surge online, despite consumer spending slowdown

Affordable fashion has driven the increase in online spending over the past quarter despite the ongoing cost-of-living crisis, according to a report by Australia Post.

Online spending for the April-June period was up 1.1 per cent year on year, the latest quarterly Inside Australian Online Shopping Report shows. Approximately 5.7 million households made an online purchase every month during the quarter, up 3.8 per cent compared to the prior-year period.

Fashion & apparel led the growth in online purchases with a 19.1 per cent improvement, mainly driven by affordable fashion items.

Health & Beauty and hobbies & recreation posted increases of 6 per cent and 1.3 per cent respectively. However, a reduction in basket size suggests that despite parcel volume growth, shoppers are opting for more frequent but less expensive purchases.

By region, Tasmania saw the strongest growth in online purchases (8.1 per cent), followed by the NT (6.7 per cent) and Queensland (5 per cent).

For the 12 months ended June 30, online purchases grew 2 per cent, partially driven by key sales events like the End of Financial Year (June 7 to 30), where spending expanded 4.4 per cent.

“Household spending data shows that Australians are being careful with how they spend their money, and we’re seeing online shopping help them manage costs and shop strategically for affordable items,” said Gary Starr, Australia Post executive GM, parcel, post and e-commerce services.

“Retailers should note that while overall spending may be down, there are still plenty of opportunities to connect with their customers online – particularly during sales periods,” Starr added.

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