For retailers, Christmas is a time to significantly boost sales amidst customers hunting for bargains for gift-giving. Monash Business School Research is forecasting a specific surge in online spending for consumer electronics.
How Aussies spend money this Christmas may vary due to the rising cost of living, but whether it’s the holiday “ritual” or the temptation to spend with ubiquitous “SALE” banners, research by the Monash Business School revealed that 65% of Aussie shoppers will make an online purchase during a 2023 sale events.
The research forecasts clothing to be most popular at 64%, and consumer electronics to be the second most popular product category, with 36% of Australians tipped to make a purchase. Third on the category list is Household products at 32%, which is a new category sold by Harris Technology.
It also further validates Australia Post’s recent eCommerce data which revealed that 82% of households (9.4 million) made an online purchase last year.
For eCommerce company Harris Technology (ASX: HT8), early Christmas preparation is in full swing, attracting early bird shoppers ahead of the busy retail season.
After venturing into the Household category in 2022, Harris Technology has seen a steady increase in sales and product margins, especially from seasonal ranges like Christmas and summer products. To stay ahead, the Company began listing and distributing these items earlier than usual, resulting in strengthening sales data through September and October as Australians gear up for Christmas in tight economic circumstances.
“Listing seasonal products earlier than previous years has generated encouraging sales data over the past two months as customers appear eager for the holiday season and getting in earlier with their online bargain hunting.” said Harris Technology CEO, Garrison Huang.
“These sales have come from Christmas and Summer products, but we’re also looking forward to launching some tech products in preparation for Christmas which have performed well in international markets.”
The coming product launches in Australia will be via Harris Technology’s Manufacturer-to-Consumer (M2C) division which are white-label brands that the Company sells on behalf of international product manufacturers. These partners typically produce tech products at substantially lower prices than famous brands, with Harris Technology marketing them on its online platforms.
With consumer spending having struggled over the past 16 months as Australians face cost-of-living pressures in response to the rising interest rates, Huang expects these lower-cost tech products to be more attractive to customers.
“Our M2C business has been selling a small number of tech products in the United States, United Kingdom, Canada and Singapore with good margins, encouraging us to grow its presence in Australia,” said Huang.
“As customers increasingly seek value in their shopping this year, we think there is an excellent opportunity for our M2C business to ramp up its sales over the next 12 months in Australia and abroad.”
Despite a slowdown in traditional IT product demand, the division is positioning as a driving force behind Harris Technology’s strategy to lift overall product margins following the strategic review in 2022. This reflects a shift in consumer behaviour, where consumers are increasingly open to private-label and refurbished alternatives over premium brands.
For the quarter ending 30 September 2023, Harris Technology recorded $4.4m in sales, $226k positive operating cash flow and ended with $1.6m cash in the bank.
Clara is a Business Reporter for The Sentiment.
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