Amazon's online business in Australia unlikely to kill local businesses: expert

CANBERRA, Dec. 6 (Xinhua) -- While Australian-owned businesses have been dreading U.S. retail giant Amazon's expansion into the local market, it shouldn't be the cause of too much "doom and gloom", a marketing expert from Australia's Swinburne University said on Wednesday.

One vocal opponent to Amazon's expansion down under has been Gerry Harvey, owner of local retail chain Harvey Norman. Harvey has for months warned that Amazon will suck sales away from small businesses due to their cut-throat approach to selling goods such as electronics, books and toys online.

"There will be a lot of retailers that will be badly affected and that will go out of business. It's quite tired out there at the moment," Harvey said back in September.

"That's a shame, because they employ people and they pay taxes. Amazon hasn't made a profit in retail in 23 years."

But Sean Sands, Associate Professor of Marketing at Swinburne University, told Australian Broadcasting Corporation (ABC) radio that any disruption to the local market would be short-lived, and local retailers have braced for the absolute worst-case scenario.

"There's this fear of 'doom and gloom'. It has happened before, whether it be the introduction of Google, the introduction of eBay and the introduction of mobile phones and people price-shopping on their phones," Sands said.

"I think there's no doubt the entry of Amazon will shake up the bricks-and-mortar industry in Australia, but I think no more so than when Zara, H&M and Uniqlo came to the fashion retail market several years ago."

"Yes, they shook up the fashion retail market, but then after some time, it all settled down and everyone got back down to business."

Sands added that there were ways for local businesses to differentiate themselves from a 'faceless' retailer like Amazon and maintain a strong following.

"It's not possible for everyone to compete on price anymore. If retailers continue to compete on price, then they will fail," he said.

"They need to shift their focus away from price and more on experience, whether it be a concierge service, an express delivery service or a longer guarantee period."

Amazon launched its online business in Australia earlier this week. Enditem