The site for Amazon's first Australian distribution centre in Dandenong, Victoria. Photo / Getty Images
Retail giants are terrified Amazon will "decimate" local business — but they'll find little sympathy from the average Aussie shopper.
In the lead-up to Amazon Australia's launch, many consumers took to social media to welcome the online heavyweight's entry into the market, and to slam large Australian retail chains for taking their customers for granted through high prices, poor customer service, limited range and a lack of online offerings.
And while many retail experts predict Amazon won't actually be a death-knell for bricks-and-mortar businesses, they agree Amazon's arrival should serve as a wakeup call to big businesses such as eBay, Woolworths and Coles, Harvey Norman and JB Hi-fi.
University of Tasmania marketing lecturer Dr Louise Grimmer said Amazon's arrival wouldn't be an Armageddon, but that "big retailers need to pick up their game".
"I don't think Amazon is actually going to impact as high a number of retailers as has been predicted … but big retailers have been slow to jump on the [online] bandwagon, some have let the service side of their operations slip and some have not paid enough attention to building relationships with customers in a meaningful way, and they might have taken their particular market share for granted for years," she said.
"Those bigger national chains that are selling things we like to buy online, such as electronics, are going to face competition."
Queensland University of Technology retail expert Dr Gary Mortimer said Amazon would offer shoppers greater choice and give businesses the chance to reach new customers.
"I think you'll always find customers with an axe to grind about big retailers — we hear the same voices over big airlines and big banks. When anything new comes to the market consumers will trial it and some will even make a protest transaction," he said.
"But I think Amazon will have very little impact on the way shoppers spend. It certainly doesn't mean retailers should rest on their laurels though — Amazon should be a catalyst for retailers to really look at how they engage with consumers, how they create positive experiences in store and how they respond to feedback on price, service and range."
Retail analyst Geoff Dart, of DGC Advisory, said Amazon would create competition, which was "great for everyone".
However, he predicted Amazon would struggle to recover the cost of capital thanks to the "tyranny of distance", and said that as long as existing retailers embraced technology, they actually had an advantage over Amazon.
"I think Amazon has been overrated and it's going to struggle. I think it will get initial volume but it will be struck by the tyranny of distance. There will be a strong initial take up — we as Australians like to try things and we're certainly tech-savvy, but we're particular about quality of products and service," he said.
"Traditional retailers have to be tech savvy with a good omni-channel offering. The advantage of bricks and mortar is when it comes to exchanges, you can take things back, but with Amazon you can't do that. You've got to play to your strengths."
Auditors PwC: Cited disruptions to operations from that IT upgrade.