National Online Spending Drops Despite Pockets of Growth
MELBOURNE, AUSTRALIA, 12 July 2023 - Australians are spending on average nearly $600 less online than they were a year ago, according to the latest Digital Economy Index from leading global financial platform Airwallex.
The Airwallex Quarterly Digital Economy Index records year-to-date spending per adult, as well as quarter-by-quarter snapshots of the digital economy by state and industry.
The latest Index highlighted green shoots in the online spending growth of Victoria, Queensland, Tasmania and WA, despite a nationwide dip of 1.82% worth $523.3 million for Q2 this year compared to Q2 2022. Online spending is estimated to have dropped $587 per adult across the 12 month period up to and including Q2 2023, compared to Q2 2022.
The Index also recorded strong upticks in online education and travel spending; however, these were overshadowed by a decline in retail, insurance and self-managed investments.
Full data tables of digital spending per person for each state, as well as digital business turnover by state and industry, are available at the end of this media release.
NSW: Overall decline in revenue turnover compared to last year (-7.93%) driven by a steep drop in online subscriptions (-17.75%) and travel spending (-9.15%). However, digital travel businesses have seen a rebound compared to Q1 this year (+15.11%)
VIC: Victoria’s digital businesses saw a nearly 6% lift in revenue turnover (vs Q2 2022) on the back of a jump in e-commerce spending (+8.28%) and education (+4.24%). Digital travel spending continues to drag however, dipping -1.91%
QLD: Queensland’s digital economy rose +3.90% compared to last year, influenced by a 5.2% increase in online travel spending. Queensland is seeing declines in spending in online education (-5.55%) and e-commerce (-5.60%).
WA: Western Australia’s digital economy grew at 2.81% for the year, thanks to a surge in online technology and digital content spending (+5.22%) and travel booked online (+6.77%). WA e-commerce businesses have seen an overall 7.71% drop in spending compared to last year, and down 4.9% compared to Q1 this year.
SA: South Australia had the worst performing digital economy this quarter, according to the Index, with online spending shrinking 16.77% and declines recorded across all industries in the digital economy for both time periods (vs Q2 2022 and vs Q1 2023).
TAS: Tasmania’s digital economy continues to be a powerhouse, with revenue turnover increasing 12.8% compared to last year. However, there are signs a contraction is looming with a -4.89% drop compared to Q1 this year. Tasmania’s online travel sector is driving the growth, spiking 15.01% for the year.
Airwallex Director of Strategy for Australia and New Zealand, Amelia Hamer, said the Index showed the spending downturn was uneven across the country as different parts of Australia felt the effects of the broader uncertain economic environment.
“Across the digital economy, we see Australians are holding back on their discretionary spending,” Hamer said.
“As interest rates have climbed and cost-of-living pressures have increased, it’s no surprise Australians are being more selective about where they spend online.
“We see several bright spots in Australia’s digital economy, with the technology, education and travel sectors seeing the most upside.
“There are still lingering effects of the travel bounceback post-COVID in this data, with the surge in online travel particularly benefitting destinations like Queensland, Tasmania and WA.
“However, the data shows that NSW is bearing the brunt of the change in how Australians are spending their money online. This downturn is something we’re seeing in the quarter-by-quarter comparisons in other states too.”
Airwallex media contact - [email protected]
Airwallex is a leading global financial platform for modern businesses, offering trusted solutions for global payments, treasury and expense management, and embedded finance. With our proprietary infrastructure, Airwallex removes the friction from global payments and financial operations, allowing businesses of all sizes to unlock new opportunities and grow beyond borders.
Proudly founded in Melbourne, Airwallex powers over 100,000 businesses globally and is trusted by brands such as Brex, Rippling, Navan, Qantas, SHEIN and many more. For more information, visit www.airwallex.com.
DIGITAL ECONOMY INDEX Q2 2023
The Digital Economy Index focuses on the income turnover for digital businesses as an indication of consumer confidence and the appeal of different types of digital businesses.
The Index monitors the performance and progress of Australian digital businesses, analysing data from a sample of 1000 Airwallex customers, adjusted for company size, industry and geographic location to ensure relevant representation. The Airwallex group processes nearly $50 billion in annualised transactions each year.
“Airwallex for Startups” launches in Hong Kong to help local businesses streamline operations
Airwallex today announced the launch of “Airwallex for Startups”, a business readiness campaign exclusively for Hong Kong entrepreneurs to support their global growth ambitions.
Airwallex and Public partner to minimise FX costs for UK investors purchasing U.S.-based equities
This partnership minimises FX costs for UK investors purchasing U.S.-based equities
Airwallex honoured by CNBC-Statista as one of ‘World’s Top Fintech Companies 2023’
Airwallex honoured by CNBC-Statista as one of ‘World’s Top Fintech Companies 2023’; sole Asia Pacific-founded company featured in ‘Digital Banking Solutions’ segment