Australian retail (b.1947 – d.2012)
The Australian retail sector, formerly Australia’s largest industry, died suddenly on December 2, 2012 due to complications with understanding consumer sentiment and demand.
Born after WW2, the sector was once famous for bringing us the infamous Ugg Boot, Ron Bennett suits, Harvey Norman and Dollar Dazzlers. It outlived its elder sibling, Manufacturing, by 20 years.
After a successful career spanning some 60 years, Retail struggled to keep up with the changing buying patterns of its customer base. Many of them had discovered the Internet, an invention that had become de rigueur in the 1990s in Europe and the US, and from then on retail in the 21st century changed forever.
Retail giant guru Harvey Norman adamantly declared in the late 90s that the Internet would be a flash in the pan and the thought of customers using it to buy goods was preposterous. Norman would later go on to expand his electronics and white goods empire to prime markets, such as Ireland, Slovenia and Malaysia. Harvey Norman continues to struggle today but has, at least an online presence after much hesitation and head scratching. He concedes that he did not see Retail’s impending death coming: “I only created our website in 2010, after those bloody commie pinko politicians who think they run the country would not tax consumers on goods under $1000 that were imported. Honestly, I dont like it – we should be able to screw competitors and consumers alike and the government should help us do that. So now I source my goods from China and sell them to Aussie customers so that I can bankroll my expansion plans in the Cook Islands.”
After investing heavily in bricks and mortar stores, many retailers failed to comprehend consumer reluctance to spend money on goods that were up to 70% cheaper overseas or online. Even as late as 2011, Retail introduced heavily discounted stocktake clearance sales every 20 minutes. One store was even rumoured to be having sales on stocktake sale items.
By the summer of 2010 staff to customer ratios reached unprecedented levels, by Q3 2010, analysts predicted this to reach 1278:1.
Even at prestigious labels’ flagship stores customer service was at an all time low. Louis Vuitton, who had previously trained their store staff at the largest customer service centre in Latvia, could not prevent weak sales, eventually pulling out of the Australian market and opening up stores in Slovenia and Ireland.
Industry experts pointed to 2 key shortcomings in the retail sector: out-of-date products (David Jones were still selling powdered eggs in their upmarket foodhall in 2009) and a lack of customer service. The prevailing philosophy was that if a customer wasn’t wearing Gucci and draped in expensive jewels, they weren’t going to spend thousands of dollars at their stores. Hence, Russell Crowe doesn’t get a look in when he is in Sydney.
Retail leaves behind a wife and 2 children: Mining and Education (from a previous marriage).