Online businesses in New South Wales, Queensland and Tasmania have seen annual turnover jump by up to 13%, despite online spending dropping by more than $124 million nationwide, according to the inaugural Digital Economy Index from payments fintech, Airwallex.
The Index shows Australians have spent $124.1 million less online than a. year ago as people buy fewer clothes and products through e-commerce, and redirect some of their spending into booking travel and education courses.
The Index estimates that online businesses in NSW have seen a 12.94% jump in turnover over the last year, while those in QLD have jumped 6.14% and TAS by 1.9%. Online businesses in Victoria saw a 25% hit to turnover, South Australia was down by 13.6% and Western Australia by 36%.
While the boom in NSW was driven by an increase in local e-commerce income, QLD and TAS benefitted from more online tourism spending. VIC online businesses slumped from a lag in attracting the education dollar, while the SA and WA declines appear to be driven by lower tourism spending.
Airwallex director of strategy for Australia and New Zealand, Amelia Hamer said the Digital Economy Index showed spending was flat with online businesses in Australia with a slight 0.07% annual decline, which highlighted they were holding up in the face of a negative economic outlook.
“Online businesses are holding more strongly than other parts of the economy but the data shows they aren’t immune from the economic headwinds the world is facing,” she said.
“The message from this data is if you’re going digital, you’re generally going strong. Especially compared to businesses that aren’t part of the digital economy where we’ve seen online business growth outpace the latest ABS data on turnover in almost every category, except retail trade or e-commerce. The figures indicate the post-COVID economic recovery is patchy, in full swing across some areas while SA and WA, as well as VIC, continue to struggle.
“Consumers are still drawn to spend with digital brands, but their reliance on them has waned post-lockdowns. Australian online businesses need to work harder to find opportunities to grow their income and revenue. Those smaller businesses that are still feeling the squeeze from the downturn need to keep focused on using the tools that will cut their costs, so they’re well positioned for when conditions pick up again.”