Retailers scale back ad spend amid stricter privacy laws
Aussie retailers plan to reduce their spending on targeted advertising ahead of the holiday shopping season due to stricter privacy laws and rising costs, a survey by Fiverr International shows.
The survey found nearly 25 per cent of businesses are scaling back targeted advertising as the impending privacy regulations are set to align with Europe’s stringent GDPR laws.
“The upcoming privacy regulations are really pushing businesses, especially mid-sized ones, to rethink how they approach advertising,” said Gali Arnon, chief business officer at Fiverr.
“With the rising costs and risks tied to data-driven advertising, along with the new challenges around consent management, companies are being driven to shift toward more sustainable and privacy-compliant marketing strategies.”
The survey businesses said they will relocate their budget toward enhancing customer experience and operational efficiency, with 41.8 per cent investing in AI and 40.8 per cent optimising logistics and shipping options. Some 39.8 per cent said they will form partnerships with content creators and influencers to reduce reliance on traditional advertising methods.
The study also found that 84.2 per cent of businesses are using AI in their e-commerce operations, particularly for chatbots and inventory management.
In addition, nearly half of the surveyed retailers expressed their concerns about the increasing competition from larger and well-resourced e-commerce brands such as Shein, Amazon and Temu.
“It’s a critical time for businesses to invest strategically, ensuring every dollar spent contributes to long-term growth and customer loyalty,” Arnon remarked.
Fiverr conducted the nationwide survey of 504 consumers and 500 small-to-medium business leaders across Australia, in partnership with Censuswide.
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