The company recently tightened its grip on the online book retailing space having acquired the UK based company The Book Depository. Recently the company acquired Canada’s Advanced Book Exchange which is now known as ABEbooks, and links thousands of independent online booksellers globally.

The Book Depository is very popular with Australian consumers, in large part because of the company’s offer to provide what it says is free shipping on its huge catalogue to Australia.

The promise of free shipping however is a little deceptive, since the company typically adjusts the price of the books to the country where the purchase will be sent to. Despite that, the price remains competitive, and shoppers will find that the cost of book delivered to them in Australia remains well below what would be paid at a local bookstore. Whether they can continue to do so under Amazon’s ownership remains to be seen.

Says Neill Denny, editor of the UK Bookseller magazine: “The publishing industry will be worried about the concentration of power in Amazon’s hands. They don’t like the stranglehold it has over online bookselling as it is.”

DoubleClick last week put all three Amazon properties — ABEbooks, Book Depository and Amazon.com — to the test, to see which could come up with the lowest price for a copy of Tim Winton’s Breath.

This title in an Australian bookstore will cost $24.95 for the paperback edition and $45 for the hardcover.

Amazon.com offered the paperback version for $5.41 plus shipping to an address in Sydney address bringing the paperback total to $15.51, whilst the hardback version including delivery costs $24.95.

Book Depository, with its “free” shipping, offered the paperback at $11.77, the hardback at $21.94.

On ABEbooks, 270 booksellers on three continents offered us new copies of the paperback ranging from $1 to $14, and the hardback for about $22.

Compared to the price in a local store the quotes are amazing, and it comes as no surprise that Australian bookstores have been fighting an uphill battle.

Websites tend to be updated daily, and with new products, and discount coupons. Shoppers can choose from a vast variety of products, and once and item is selected simply add it to your digital cart, and the payment is made using a credit card, with the good dispatched to the address given.

Shopping online, lets you browse an endless variety of products, with some websites allowing you to make use of discount coupons, which can be redeemed when you purchase the item or on your next purchase.

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Retailers such as David Jones and Myer have slashed their prices by as much as 50 per cent as they seek to attract customers who are increasingly becoming frugal against a backdrop that some are calling the worst sales environment in 20 years.

This week Myer said that the current sale season has not provided any relief from the horror that the last nine months have been. “What we’ve seen is disappointing, but in line with what we were expecting,” Myer spokeswoman Jo Lynch said.

“We expected a slightly disappointing stocktake as consumers continue to save, but the whole industry is experiencing a period of subdued spending.”

Edward Butler, a retail analyst with IBISWorld says that consumers no longer operate under the belief that the traditional sale season is the best time to find cheap deals

“Consumers find it hard to believe in sales. The idea of a special – it is oxymoronic. Not only that, but discounts that looked generous in the past don’t look so much now. A 10 per cent discount today has very little impact,” Mr. Butler said.

Margy Osmond chief executive Australian National Retailers Association says it is still far to early to ascertain whether retailers will benefit from any bounce.

“There may be a lack of people moving through the stores. There were a lot of people out and about at Christmas, but they weren’t buying.”

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Check list

• Use anti-virus, and anti spyware software so your computer is protected.
• Make sure you are on the lookout for common scams that ask for your personal information.
• Make sure that the website you wish to purchase from is secure before you transact
• Don’t forget to include the cost of delivery, and compare prices before deciding to buy
• Use your credit card to pay for the transaction, since it provides additional protection.
• There is a cooling-off period should you change your mind about something you have bought online
• You have the same rights when buying online as you do on the high street

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The Shop, Distributive and Allied Employees Association – which represents 230,000 retail workers says that the current tax structure means that traditional retailers have to compete on an uneven playing field.

Consumers who make purchases worth less than $1,000 from overseas are exempt from paying GST. As a result, Australian retailers are lobbying the government to remove the threshold as they face intense competition from online stores based overseas.

”The government should impose a GST on all overseas purchases. This would mean all goods purchased in Australia, whether from Australian or overseas suppliers, would be subject to the same tax regime,” says the submission.

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The ability of Australian consumers to safely source and procure cheaper goods internationally has broken the tyranny of distance that has saddled consumers with opaque pricing and higher costs.

Brick and mortar retailers have found that in recent months Australian consumers were increasingly switching to online retailers where they were finding their dollars stretched a lot further.

Whilst reliable data is hard to find, the Reserve Bank of Australia estimates that online shopping accounts for approximately 3 per cent of the A$700 billion in domestic consumption, and is growing rapidly.

A recent survey conducted by the central bank found that 80 per cent of those polled had made purchases online, and that the total value of purchases made internationally has been growing by 15 per cent a year since 2005.

The temptation to buy from overseas is certainly understandable with the cost of books and DVD’s routinely between 30 to 70 per cent cheaper internationally, even after taking account of shipping costs.

The current Amazon.uk top selling book, for instance costs just A$6.20 at current exchange rates. In Australia however, the very same item retails for A$23 online from one of the biggest book chains.

Scenting the potential, the UK arm of Amazon recently stopped charging postage on the 11,000-mile trip to Australia and New Zealand on all orders worth 25 pounds ($41) or more.

Obviously feeling threatened, billionaire retailer Gerry Harvey joined a campaign pushing for the closure of a loophole which allows Australians to purchase up to A$1,000 of goods online without having to pay the standard 10 percent goods tax.

That move resulted in a deluge of criticisms from angry consumers who derided Australian retailers, with such vitriol that Mr. Harvey was forced to withdraw from the campaign saying his involvement had been “suicidal”.

One newspaper poll on the controversy drew 35,500 replies with 99 percent favouring online shopping.

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The results contradict the claims made by Australian retailers that online shopping is killing their businesses.

The most popular site for Australian shoppers is eBay, which had 5.58 million unique visitors in January, according to Nielsen NetView.

US-based retailer Amazon came in second with 2.19 million visitors, the remaining sites in the top 10 visited are all Australian retailers. Woolworths placed third with almost 1.49 million unique visitors in January and Woolworth owned brands Big W and Dick Smith also made it, coming in at six and eight respectively.

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“It is likely that much of this growth in international purchases reflects the significant increase in the number of Australians travelling overseas. A reported 6.25 million trips were made by Australians in 2010 which naturally resulted in greater overseas expenditure. Although it is not possible to specifically identify online offshore purchases, the data suggests that the share of this type of purchase in total spending remains relatively low,” the RBA said.

So clearly the trend of shopping online in the country is growing and the claims that people are using the internet to avoid paying GST a little dubious.

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eBay chief executive John Donahoe made the comment which comes against a backdrop of a Australian retailers such as Gerry Harvey which are lobbying the government to impose the GST on online purchases that originate from the country.

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35 per cent of all UK shoppers says they look for discount codes before making a purchase.

“While the increase in online shopping is positive for British retailers, the survey also reveals a critical challenge, with a significant number of consumers shopping around and comparing products before making a purchase,” says Neal Perry, EpiServer’s U.K. country manager. “To convince these savvy shoppers to buy, retailers need to deliver an engaging and satisfying online experience, otherwise they’ll merely migrate to the competition.”

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