Australian consumers expect a frictionless digital experience

Wednesday, 5 July 2017

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  • Australia has one of the highest levels of smartphone usage in the world (88%)
  • Eighty nine percent of digital opinion leaders believe there is a lack of investment in developing the digital experience by businesses in Australia
  • Forty percent of Australians say that organisations failing to offer them a high quality digital experience risk them walking away

Australia has fallen in global rankings for digital readiness, but consumer optimism remains high with 56% of survey participants ranking Australia’s digital economy as the same or more advanced than peer economies – up from 49% in 2015.

EY today launched its third edition of the Digital Australia: State of the Nation report revealing an underlying expectation from consumers that businesses understand their preferences and provide a seamless customer experience.

Seventy-nine percent of consumers want their information to be integrated across all points of contact. While 68% of Australians worry about privacy and what personal information organisations can access, they still expect organisations to ‘know them’, personalise their preferences and filter what information is being delivered.
With 88% of Australians using a smartphone, the expectation is for fast, efficient delivery on a mobile platform. Australians want information instantly and expect a truly differentiated and frictionless experience.  

Digital disruption has demolished 52% of the Fortune 500 companies in Australia since 2000 and the disappearance of many iconic, global companies and products in recent years is a reminder that relevance is everything.

Forty percent of consumers say that organisations who fail to offer a high quality digital experience run the risk of losing their business.

EY Oceania Technology, Media & Entertainment and Telecommunications and Customer Leader Jenny Young said the most successful organisations have recognised the rapid shift that has occurred in customer mindset, disposition and behaviour.

“The focus needs to be on the individual consumer, ensuring that customers feel like their needs are understood and the experiences, products and services they receive are personalised”.

Thirty-one percent of Australians have given feedback to a company on social media in the past 12 months.

Social media is an integral part of consumer behaviour. Facebook continues to be the dominant social media offering and has the same level of penetration as smartphones. Eighty percent of Australians use Facebook, with 30% of Australians increasing their usage over the last year.

While Instagram, WhatsApp and Snapchat saw a rise in usage, no social network matches Facebook’s overall usage levels, putting it in a social media league of its own.
EY Technology, Media & Entertainment and Telecommunications Partner David McGregor said social media can play a mainstream role in delivering on business outcomes, including in reducing cost to serve and retaining the most valuable customers.

“Organisations need to get a better understanding of their social customers and develop new capabilities aligned with commercial goals and customer needs.”

Social media works on a time frame. It is a fast paced 360 degree platform that never sleeps. Consumers expect responses within the hour (if not immediately). Research shows that chat apps are more commonly being used in Australia with thirty three percent of consumers surveyed currently using Whatsapp, Viber and/or WeChat.

“Progressive organisations are harnessing the power of chat and using ‘chatbots’ and other automated programs to engage with customers who expect fast, fluid and relevant interactions,” Mr. McGregor said.

Digital privacy

There is concern amongst Australians about how well organisations manage and protect privacy – what information can be accessed, what might be done with the data and ultimately how safe the information is. There is a clear expectation for greater transparency which is also supported through legislation with the Notifiable Breaches amendment coming into the Privacy Act early next year.

Seventy-eight percent of Australians want the government to mandate greater transparency in how organisations use consumer information and 20% believe their digital security has been compromised in the last year. Getting hacked is a fundamental concern and cyber security is uppermost in the minds of Australians.

Digital Government

More than six in ten (63%) of Australians and 76% of digital opinion leaders support the nbn.

Current awareness of access to the nbn has doubled since EY published the 2016 report, with one third of Australians (33%) believing they can access the nbn. Forty percent of Australians also believe the nbn enables a world class digital economy in Australia.

The report outlines a significant difference in perception between urban and regional/rural populations towards digital capabilities with 46% of urban dwellers believing their towns are digitally advanced, compared to 21% in regional/rural locations.

Digital entertainment and wearable market

Television and movie streaming subscriptions rose from 18% to 28% as Australians welcome the ability to pace themselves, self-select and skip ads. In the last 12 months, Netflix has jumped from being accessed by 60% to 76% of Australians who stream. The proportion of Netflix users is now on par with Foxtel users (24% vs. 23% of Australians respectively). 

Music streaming revenue has also increased by 90% over the past 12 months. Streaming now accounts for 38.5% of Australia’s overall music market. Streaming and related digital services are growing in popularity, with ‘watching music on YouTube’ sitting at 53%.

Radio still plays a predominant role in the delivery of music to Australians. Stereo/car radio is the number one source for listening to/acquiring music, although it has dropped slightly this year.

Wearables, gaming and e-sports are now embedded into our way of life. The wearables market continues to grow, with strong appeal of the devices, particularly amongst those under 45 years old. The research shows that the most appealing wearable device is the VR headset / controller, followed by smart glasses, smartwatches and digital clothes.

Automotive   

Sixty-five percent of millennials and Gen Z see their car as their primary mode of transport however one in seven already feel that ride sharing options have diminished their priority for owning a car. Twenty-two percent of 18-34 year olds have used ride sharing apps or websites and 32% of Australians find self-driving motor vehicles appealing showing a strong consumer appetite for new service delivery models.

Citizens are demanding greater flexibility, more predictability, increased time saving and improved affordability. At the heart of this is growing enthusiasm for new digital-led mobility solutions. While completely automated vehicles are unlikely to be operational in the immediate future, demand for in vehicle technology is a priority.

For a copy of the report and to view all the data from the primary research, available in filterable tables, visit EY’s interactive online portal at digitalaustralia.ey.com

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This news release has been issued by Ernst & Young Australia, a member firm of Ernst & Young Global Limited. Liability limited by a scheme approved under Professional Standards Legislation.