The delivery wars are set to heat up this Christmas, and Australia Post has been rallying local retailers to sign up to its new free parcel delivery program Shipster ahead of the start of festive trade.
As Australian retailers prepare for Amazon’s impending launch, Australia Post revealed on Tuesday that more than 40 local retailers have signed on to its new delivery scheme, which will involve customers paying a monthly membership fee to the mail carrier in exchange for free delivery for online shopping purchases at participating businesses.
In the first phase of the plan, customers in Melbourne, Sydney and Brisbane can sign up between now and January 1, 2018, for an introductory price of $9.95.
After that time, Shipster members will pay $6.95 a month for the service, which will allow access to free delivery for parcels that incur shipping costs of $20 or less.
Shoppers create a Shipster account or link their subscription to their existing Australia Post account, and then use that same email address when completing their online shopping orders with selected retailers to receive free shipping on all orders of more than $25.
“With online shopping growing from 11.5 percent to 15 percent in the last 12 months, we’re predicting the busiest year for online shopping we’ve ever seen at Australia Post,” Australia Post chief executive Christine Corbett said in a statement about Shipster’s launch.
Among the brands included in the first stage trial of the program are Kogan, Cotton On, Myer, Harvey Norman, Target, Booktopia, Bridsnest, Showpo and Costumes.com.au.
Food delivery service Deliveroo has also jumped on board, with Shipster members entitled to free delivery on one Deliveroo order each month.
Country Manager for Deliveroo Australia Levi Aron says the partnership with Shipster came about because “it was immediately clear that the combination of online shopping and seamless delivery from awesome restaurants was a perfect fit”.
“We’re all so busy these days, and coming into Christmas we’re even more time poor. That doesn’t mean that we don’t want to treat our families and friends to gifts and delicious meals,” he says.
Nathan Huppatz, co-founder of Costumes.com.au, says his business had been in conversations with Australia Post around signing up to the Shipster program for some time, saying the former Smart50 finalist is “very keen” to try any new ideas to secure sales conversions in a competitive environment.
“We know consumers respond to free shippers really well, and we were happy to invest the time and effort in this,” Huppatz says.
There is no cost for retailers to be involved with Shipster, however businesses do have to do the work on technical integration to ensure customers get the free shipping benefits of Shipster when using the retailer’s online stores.
SmartCompany understands there will be no costs to businesses for signing up to the scheme, but Huppatz indicates that businesses will be given a rebate from customer subscriptions to Shipster. This will contribute to covering part of the free postage when Shipster parcels are sent, but it is anticipated businesses will have to cover at least some of the postal costs.
When asked for clarification on how much of the postal fees businesses would have to cover through the scheme, Australia Post advised details of this had not been released.
Huppatz says his business is also preparing to sell through Amazon when it launches in Australia, reflecting that Costumes.com.au will consider any tool that it thinks will work well to boost sales in the tough retail climate.
“It’s always competitive, it’s getting more competitive, but I think the good retailers will end up doing well,” he says.
Australia Post has aimed the first part of the Shipster program squarely at this year’s Christmas trade, with Christine Corbett reflecting that over the past 12 months, online sales in Australia have jumped from 11.5% to 15% of overall retail spend.
* This piece was updated at 3:45pm on October 11 to include comments about the postal costs for businesses using the scheme.