Retail in a Tough Place when eBay's Customer Traffic Declines

Retail in a Tough Place when eBay's Customer Traffic Declines

We know retail is in trouble when eBay.com.au, the number 1 e-commerce site in Australia records an 8% to 10% decline in traffic between July and December 2021.

The numbers speak for themselves on monthly visits to their website [reference: Similarweb]

  • July 2021 71,500,000 (100%)
  • Aug 2021 68,600,000 (96% of July 21)
  • Sept 2021 69,000,000 (96.5% of July 21)
  • Oct 2021 64,400,000 (90% of July 21)
  • Nov 2021 66,600,000 (93% of July 21)
  • Dec 2021 65,900,000 (92% of July 21)

Considering eBays No 1 e-commerce position, e-commerce is outperforming bricks and mortar and their products and categories are pitched at lower price points the performance is a bell-weather for the rest of retail and the economy as a whole.

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As a comparison, I then looked at the first-half results till Dec 2021 for Mosaic Brands Ltd one of Australias largest fashion retailers with 1091 stores and compared their performance for the previous 2 years for the same period. The results confirmed that retail is on the edge of a precipice.

  • 2019 (1/7/2018 to Dec 2019) Revenue $464.4m ( Bricks & Mortar $ 422.60m Ecommerce $41.8m - 9% of sales)
  • 2020 (1/7/2019 to Dec 2020) Revenue $413.80 ( Bricks & Mortar $372m Ecommerce $41.8m - 10.1% of sales)
  • 2021 (1/7/2020 to Dec 2021) Revenue $298m ( Bricks & Mortar $248m Ecommerce $50m - 17% of sales)

Light at the End of the Tunnel

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In my opinion, Omicron has changed the dynamics of how we deal with Covid, in that a great many of the population have either had covid or know someone that has and for the most part we have survived. People also have had to take personal responsibility for treatment or by cutting down on travel and avoiding busy places like shopping malls. Add to this most people are double vaccinated and are now getting their booster, well what more can you do.

On Saturday near where I live the restaurants were packed be it that everyone was sitting outside.

For retail, the good news is that I believe consumers now have a greater understanding of covid risk and will begin to lead more normal lives and start to visit retailers and shopping malls, the fear of the unknown has been mitigated based on our collective experiences.

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