Why the Sports and Recreation Ecommerce Industry is Set to Take the Gold
With Australia still on a high from the Commonwealth Games on the Gold Coast, where prime time TV was taken over by everything from swimming, walking and running, to gymnastics (my personal favourite), it’s safe to say that the flame of Australia’s love for sports and the outdoors has been reignited.
Combined with Australia’s other great passion, camping and the outdoors, retailers in the Sports and Recreation industry will be enjoying the fanfare, with online sellers in particular strong contenders in the race to the finish line.
In this article we are going to look at how the Sports and Recreation industry is growing in Australia and across the world, factors that are driving growth in ecommerce, and then we’ll take a look at some Sports and Recreation merchants who are doing things the right way.
Growth of the Sports and Recreation Industry
The Sports and Recreation retail industry covers any exercise, sporting and fitness equipment, apparel and accessories, as well as camping and fishing equipment. In 2016 Australian shoppers spent a collective 1.3 billion on goods to help them stay fit and get into the great outdoors, and the market is currently experiencing 3-4% growth year on year.
So what factors are driving the growth in this sector? Well,
In addition to large sporting events like the Commonwealth Games, Australians on the whole are becoming more conscious of and proactive about health and fitness. Tweet this
Over the last few years there have been a range of government initiatives to promote active lifestyles, camping and recreational fishing, and the proliferation of health and #fitspo bloggers and influencers on Instagram is having a massive impact on cultural and consumer trends. Factors which are quite similar to those driving growth in the Supplements and Nutrition industry, which we wrote about earlier this year.
Traditionally dominated by bigger bricks and mortar retailers with strong reputations and buying power, as well as price sensitive consumers, the online segment of the Sports and Recreation industry is gaining momentum and growing fast.
According to Neto research published in the State of Ecommerce Report last year, which analysed consumer and merchant data across a range of industries in Australia, both the amount consumers are spending and how often they spend are growing steadily.
- Average monthly sales grew by 39%
- Average basket size increased by 9.9% to $148.16
Of all the industries studied, Gifting topped the charts at 59% sales growth, Sports and Recreation came in second place (39%) followed closely by Motor Parts (35%).
In the US, a similar shift to online is happening in the Sports and Recreation industry, with revenue expected to grow at an annual rate of 9.9% over the next four years.
Factors Driving Online Shopping
The Neto State of Ecommerce Report also revealed the reasons why customers shop online, with ease and convenience taking the cake with 82% of shoppers surveyed ranking this as a top reason, followed by sales and promotions (46%) and the search for goods not available locally or in Australia (42%).
And once they get online, what makes customers decide to purchase from you over another store? Here’s what consumers told us:
- Price - 16%
- Free delivery - 14%
- Discounts and offers - 13%
- Brand - 12%
- Ease of Navigation and checkout - 11%
- Review and ratings - 14%
- Product image - 12%
Factors worth taking into consideration when developing your retail and marketing strategies!
What about Amazon?
In the lead up to the launch of Amazon Australia last year, we asked the 1,001 shoppers surveyed if they would be switching to Amazon for a range of goods across different sectors. For the Sports and Recreation industry, only 27% of consumers surveyed said they would switch to Amazon (that, in comparison to 65% of customers buying fashion).
Now, let’s take a look at three Neto merchants in the Sports and Recreation sector who are leading the charge.
3 Successful Sports and Recreation Merchants
Everybody’s favourite pool, beach and backyard toy store, Wahu made a splash (sorry, couldn’t resist the pun) on the market with their original neoprene water-safe balls in the summer of 1999. Founder Tim Britz saw a gap in the market for water toys after working on a number of businesses, including the well known toy manufacturer, Britz'n’Pieces.
Today, Wahu products are at the centre of any game of beach footy, volleyball or pool party. Wahu only sells direct to consumers through their online store, built on Neto, with the rest of their sales coming from B2B wholesale via larger retail stores like Big W, Rebel, Myer and other Toy retailers.
And with Beach Volleyball making its Commonwealth Games debut this year on the Gold Coast, Wahu beach toys will only go from strength to strength.
Want to learn how you too can boost profits with wholesale? Read our article Double Your Sales and Expand Your Reach With B2B Wholesaling.
Founders of Bicycles Online, Jonathan Allara and James van Rooyen started out running a bicycle tour business on the Manly beachfront in Sydney. Placing orders for new fleets of bikes each year, James and Jonathan realised that the market was dominated by a few big players who were keeping the prices of bikes high, and in that, they saw an opportunity to sell bikes online, at affordable prices.
They decided to test the waters with an eBay store and set up shop from inside an old electrical substation the size of a two-car garage with one power cord and a single internet dongle became their headquarters. The test was deemed successful after selling 130 bikes in 3 weeks, and Jason and Jonathan set up an ecommerce store, Bicycles Online, which is now one of Australia’s largest ecommerce bike retailers.
Tapping into a growing market that traditionally only purchased in-store, demand for bikes, bike parts and accessories doesn’t look to slow anytime soon. Bicycles Online has 15 staff (plus others offshore), sells around 25,000 bikes a year, and has enjoyed 40% year on year growth, much of which the founders attribute to switching their ecommerce platform to Neto. which allowed them to stop worrying about the tech, and losing time on manual tasks, to focus on what they’re good at - selling bikes. Read the whole story.
Kick PushMiserable in his soul-destroying call centre job and with a young family to support, founder of skate and scooter store, Kick Push, Darin Gersbach, realised it was time for a new direction. An avid snowboarder and self confessed ‘ultimate consumer’ he decided to turn his passion into a business and sell snow gear through eBay.
Like Bicycles Online, it didn't take long for eBay business to boom and expansion into an ecommerce store, and with his wife and kids were tripping over the mountains of sports gear in the lounge, and his mum packing orders at the kitchen table—expansion into a warehouse too.
But despite shifting into a warehouse and spending two weeks building a website to launch the the Kick Push ecommerce store, the growing pains didn’t stop there.
“Our original ecommerce platform was missing key components we desperately needed. We couldn’t grow because we were stuck spending hours every day badly maintaining a manual inventory system and fussing with order labels because we didn’t have integrated shipping.”
This, in addition to the skyrocketing costs of bolt on solutions.
“Soon we were paying $900 per month for shipping and inventory systems that didn’t even work well.”
It was a ‘Sliding Doors’ moment when the founder of Neto contacted Darin to order some scooters.
“I was pretty apprehensive about moving to a new platform because the business was already turning over a couple of million dollars a year and I didn’t want to lose orders during the migration, but it was seamless—at the click of a button it was business as usual.”
Neto’s all-in-one platform, which includes in-built inventory, fulfilment and payments eliminated the costs of bolt-on solutions—both monetary and the cost of the time spent managing the multiple different systems.
In just eight months of switching to Neto, Kick Push experienced 30% growth and saved $100k per year in labour.
Neto delivers a top of class, seamless user experience for Kick Push customers with its:
- In-built SEO capabilities and Google Shopping integration to help Kick Push get found on the web
- Product filtering to help customers find exactly what they are looking for on the site, fast
- One page checkout that’s easy to use and increases conversions
- Integrated payment options like Afterpay and ZipPay which has helped Kick Push increase average order value (30% of sales are with AfterPay!).
Are you a Sports and Recreation online or bricks and mortar retailer keen to experience growth like Bicycles Online and Kick Push? Start a free Neto trial, or download our guide to help expand your business through omni-channel retailing, Sell Everywhere.