Cost of Living and Value Shopping: What It Means for Sellers

Cost-of-living pressure has not stopped Australians spending online, but it has changed how they spend. Shoppers compare more, wait for sales, buy from more retailers and keep each basket smaller. Australia Post found 81% shop around for the best deals and 73% wait for sales events before buying. For sellers, value now has to be obvious, and margin has to be protected through lower costs rather than higher prices.

How widespread is value-seeking?

Price pressure is close to universal. Nielsen's Consumer & Media View data, released in September 2025, found almost nine in ten Australians worried about grocery prices, and almost three-quarters described themselves as bargain hunters willing to switch brands if the price is right. Nielsen notes this applies across incomes: households earning over $160,000 are also concerned about rising prices.

The pressure has eased slightly but the habits remain. IAB Australia's Commerce Report 2025 found 72% of consumers actively cutting back on non-essential items, down from 75% in 2024. auDA's Digital Lives of Australians 2025 found 72% of Australians use the internet to find savings, including price comparison sites and online discounts.

How value shopping shows up in online data

The Australia Post eCommerce Report 2026 shows the pattern clearly:

• Waiting for sales. 73% of consumers wait for sales events before purchasing, and 96% of Gen Z hold out for events such as Black Friday and Cyber Monday.
• Shopping around. 81% shop around for the best deals, and the average household bought from 16 different retailers in 2025, more than double the figure a decade earlier.
• Smaller baskets. The average online basket was $96 in 2025. Australia Post links smaller, more frequent purchases to discount-led buying, a shift to private label and free-delivery subscriptions.
• Trading speed for price. 68% of Gen X and 70% of Builders would wait longer for delivery if it meant paying less.

The trend continued into 2026. The FY27 Q1 update shows online spend up 17% while the average basket fell 6.8% to $90. Australians are buying more often, but more carefully.

Cheap platforms have reset reference prices

Value shopping also explains the growth of low-price marketplaces. Roy Morgan estimates Temu reached 5 million Australian shoppers in 2025 and Shein 2.9 million, while mid-tier department stores and legacy online retailers lost shoppers. Roy Morgan's Head of Retail Research said ultra-low prices are resetting consumers' reference prices and that retailers "stuck in the middle" without price leadership or clear differentiation face sustained share loss.

AI is making comparison easier. PayPal's 2026 eCommerce Index found 48% of Australians have used AI when shopping online, and price comparison was the top use (57%). When an assistant can compare prices across retailers in seconds, an unclear offer is easy to skip.

Value is not only price

Shoppers are cautious, not unwilling to spend. PayPal found 89% of Australians bought "little luxuries" in the past 12 months, and Australia Post reports that discretionary spending growth picked up in 2025. What shoppers want is to feel the purchase is worth it. Retailers can show that in several ways:

1. Make the saving visible. Australia Post recommends clear savings messaging and loyalty prompts at checkout.
2. Show total cost early. In Baymard Institute's research on US shoppers, extra costs such as shipping, tax and fees were the most common reason for abandoning a cart (40%, excluding people who were just browsing), so show delivery cost on the product page.
3. Use thresholds and bundles. Achievable free-shipping thresholds and bundles of related products can lift basket size without a straight discount.
4. Answer questions in the listing. Detailed, accurate product information reduces the risk a shopper feels when trying an unfamiliar brand, and reduces returns.

Protecting margin when baskets shrink

Smaller baskets and more promotions squeeze margin from both sides. Each order carries roughly the same picking, packing, labelling and admin cost whether it is worth $90 or $190. Marketplace fees, promotional rebates and refunds also make it harder to see what each channel actually earns.

That means margin protection now depends on two things: cutting the fixed cost of handling each order, and knowing the true net revenue per channel after fees. Sellers who can see that clearly can decide which promotions to join and which to skip. Peak trading makes this especially important; see our guide to peak season planning from Black Friday to Boxing Day.

Key figures

• 81% of shoppers shop around for the best deals and 73% wait for sales events (Australia Post, 2026).
• The average online basket fell 6.8% to $90 in the September 2026 quarter while online spend rose 17% (Australia Post FY27 Q1, 2026).
• 72% of consumers are actively cutting back on non-essentials (IAB Australia, 2025).
• 72% of Australians use the internet to find savings (auDA, 2025).
• 57% of AI-using shoppers use it for price comparisons (PayPal eCommerce Index, 2026).

How eComChannels helps

When shoppers compare everything, sellers need to be easy to find and cheap to run. eComChannels supports both.

• AI listing optimisation drafts listings with complete attributes and clear value points for each marketplace from one master record, and supports bulk price and content updates when promotions change. Complete listings are easier for marketplace search and AI assistants to match to a shopper's query. Your team approves every change.
• Finance auto reconciliation matches marketplace settlements to orders and applies fee rules, so you can see net revenue per channel and spot short-paid or missing remittances.
• Order management handles orders from every channel in one place with synced stock, which lowers the handling cost of each smaller order.

Book a demo or start a 30-day free trial to see where your margin goes by channel.

FAQ

Are Australians spending less online because of cost of living?

No. Total online spend grew 14% in 2025 and 17% in the September 2026 quarter, according to Australia Post. What has changed is behaviour: smaller baskets, more comparison and more buying during sales.

How can a small retailer compete with Temu and Shein on value?

Few can compete on price alone. Local sellers can offer faster, more reliable delivery, accurate product information, easy returns and a trusted brand. Make those benefits visible, and keep your own costs low so you can match prices selectively.

Do discounts still work?

They drive volume, especially around major sales events, but they reduce margin. Many retailers combine targeted discounts with free-shipping thresholds, bundles and loyalty perks, and check net margin per channel before committing to a promotion.