Online Supermarket Swallowed By Coles
Sydney Morning Herald
Wednesday May 21, 2003
Three years after the dot com crash, Australia's last surviving online grocer has been swallowed by Coles Myer, having failed to persuade the masses of the benefits of shopping from home.
Both parties refused to say how many customers Shopfast has, but market researchers put the figure at between 100,000 and 150,000 regular shoppers.
``People expected a lot more out of the sector than was delivered," said Nielsen NetRatings director, Mark Henning.
In January 130,561 people visited one of the four online grocery sites, he said. Nielsen claims Shopfast is the clear market leader, followed by ColesOnline, Woolworths' HomeShop and Greengrocer.com.
Coles Myer was tightlipped about the deal, but confirmed it would more than double its online business.
Roy Morgan Research estimates that about 2 million Australians regularly buy goods online and that some sectors, particularly travel, are booming. However, only about 200,000 people buy groceries online and there has been no growth in the past year.
Ramin Marzbani, senior analyst with ACNielsen.consult, said that while there had been little change in the number of online shoppers, converts were spending four times as much as their in-store counterparts an average of $172 per session against less than $40 for in-store shoppers.
``It's all about convenience and saving time. It's not about saving money at all," he said.
Almost 70 per cent of online shoppers are female, 55 per cent have incomes over $70,000 and 50 per cent have children under 18, Mr Marzbani said.
The Davids family of grocery wholesalers was among the major investors in Shopfast.
Greengrocer.com was sold to Woolworths in 2001 but has been on the decline ever since. The once common greengrocer.com vans have disappeared and web ratings company Red Sheriff said visitors to the site had fallen by a third since June 2000.
Jon Wood, managing director for Coles Myer's emerging businesses division, said there would be few changes in the Shopfast brand in the short term.
© 2003 Sydney Morning Herald
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