Key facts
- Kmart's Anko brand is expanding its strategy of offering lower-priced alternatives to popular items into higher price tiers and international markets.
- Domino's Pizza in Australia and New Zealand saw revenue drop over 11% in the past 12 months as it reduces discounting.
- Chemist Warehouse data shows customers buying weight-loss drugs also purchase 40% more in their shopping baskets.
- Combined battery-electric and plug-in hybrid vehicle sales reached a record 32% of new car sales in Australia in July.
- Australia Post reported a pre-tax loss of $108 million for the past financial year.
- The price of a basic stamp in Australia will increase to $1.85 on September 1.
Australians' spending habits are evolving, with recent reporting season data highlighting a significant shift in consumer preferences. Kmart's in-house brand, Anko, is successfully expanding its 'dupe' strategy, offering lower-priced alternatives to popular items and moving into higher-priced categories and international markets. This strategy has underpinned Kmart Group's $11.7 billion in sales last financial year.
In contrast, Domino's Pizza is facing challenges, with its Australian and New Zealand operations experiencing an over 11% revenue drop in the past 12 months. The company is reducing its reliance on discounting to improve franchisee profitability, a move complicated by the resurgence of cost of living pressures. A new tie-up with Coca-Cola aims to boost sales.
Chemist Warehouse, owned by Sigma Healthcare, is experiencing a boom in sales of weight-loss drugs like Ozempic. Chief Executive Vikesh Ramsunder noted that customers using these GLP-1 drugs also tend to purchase more protein powders, beauty products, and vitamins, leading to a 40% larger shopping basket size compared to other customers.
The automotive sector is seeing a strong acceleration in electric vehicle adoption. Eagers Automotive, a major dealership network operator, observed that customers rarely return to combustion engines after switching to electric or hybrid vehicles. In July, electric and plug-in hybrid vehicles accounted for a record 32% of new car sales in Australia, triple the volume from a year ago.
Meanwhile, Australia Post reported a pre-tax loss of $108 million for the last financial year. The decline in letter volumes, now at 1930s levels, combined with rising delivery costs, is impacting the postal service's finances. To address this, Australia Post will increase the price of a basic stamp by 15 cents to $1.85 starting September 1.