Australian ecommerce reached $21.9 billion, but baskets fell to $90: what sellers should do next
Australian ecommerce continues to grow, with online spending reaching $21.9 billion during FY26 Q4, according to the latest Australia Post FY26 Q4 Quarterly eCommerce Update. But while more Australians are shopping online, they're spending less per order, with the average basket value falling to $90.
That combination tells an important story.
Consumers are still willing to buy, but they're becoming more selective. Rising living costs, increased price comparison and greater competition mean retailers can no longer rely on simply attracting more traffic. Growth now comes from increasing customer lifetime value, improving conversion rates and encouraging repeat purchases.
Here are six strategies ecommerce retailers should prioritise over the next 12 months.
Review your promotional strategy
Discounting remains an effective way to drive demand, but blanket sales can quickly erode margins. Instead, build promotions around customer behaviour.
Consider:
exclusive offers for existing customers
product bundle discounts
limited-time campaigns
early access promotions for VIP customers
targeted offers for customers who haven't purchased recently
Every promotion should have a clear objective, whether that is acquiring new customers, increasing average order value or reactivating previous buyers.
If every campaign has the same percentage discount, customers will quickly learn to wait for the next sale.
Optimise your free shipping threshold
With average order values declining, your free shipping threshold becomes even more important.
Rather than offering free shipping on every order, set the threshold slightly above your current average order value.
For example, if customers currently spend around $90 per order, testing a free shipping threshold between $110 and $120 may encourage shoppers to add another item before checking out.
Small increases in basket size across hundreds of orders can significantly increase revenue without increasing marketing spend.
Review this threshold regularly as purchasing behaviour changes throughout the year.
Segment your customers instead of treating everyone the same
Not every customer responds to the same message. Customer segmentation allows retailers to personalise offers based on purchase history and behaviour.
Useful segments include:
first-time customers
repeat customers
high-value customers
customers who haven't purchased in six months
seasonal shoppers
Each group should receive different emails, promotions and product recommendations.
For example, a first-time buyer might receive educational content and a welcome discount, while loyal customers could receive early access to new products or exclusive bundles.
Better segmentation generally leads to stronger engagement and improved retention.
Diversify your marketplace strategy
Many retailers rely heavily on a single sales channel. Whether that's Shopify, Amazon, eBay or another marketplace, over-dependence creates unnecessary risk.
Marketplaces remain valuable for reaching new customers, but they shouldn't become your only source of revenue.
Instead:
identify which products perform best on marketplaces
use marketplaces to acquire new customers
encourage repeat purchases through your own ecommerce store where possible
monitor profitability by channel rather than overall revenue
Understanding which channels generate your most profitable customers allows you to invest marketing dollars more effectively.
Focus on customer retention, not just acquisition
Acquiring new customers is becoming more expensive.
Retaining existing customers is often the more profitable strategy.
Simple retention initiatives include:
post-purchase email sequences
loyalty programs
replenishment reminders
personalised product recommendations
excellent customer support
Returning customers generally convert faster, spend more over time and cost less to market to.
Rather than measuring success purely by new customer numbers, retailers should also monitor repeat purchase rate, customer lifetime value and retention rate.
These metrics provide a clearer picture of long-term business growth.
Start planning for peak earlier
One of the strongest messages from the Australia Post report is that promotional events continue to influence shopping behaviour throughout the year.
Retailers who begin planning only a few weeks before Black Friday or Christmas often miss opportunities to optimise inventory, marketing and fulfilment.
Start preparing months in advance by reviewing:
historical sales performance
inventory forecasts
promotional calendar
shipping capacity
email campaigns
advertising budgets
Peak-period planning should also include testing website performance, reviewing the checkout experience and ensuring reporting dashboards are ready before campaigns begin.Businesses that prepare early can react faster when demand increases.
The takeaway
Australia's ecommerce market is still growing, but consumer behaviour is changing.
Higher order volumes no longer guarantee higher revenue. Retailers need to focus on improving average order value, increasing customer lifetime value and building stronger relationships with existing customers.
The businesses that succeed over the next year will not necessarily be those with the biggest advertising budgets. They will be the ones making smarter decisions about promotions, customer segmentation, marketplace strategy and retention.
The latest Australia Post data provides valuable insight into where the market is heading. The next step is to turn those insights into action.
Turning more orders into more profit requires good marketing and efficient fulfilment.
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