Promising figures
Italian e-commerce has started off well with a set of promising figures:
• 14 million online consumers at the end of 2013
• 20% more e-shoppers than last year
• E-commerce sales revenue of 11.2 billion euros
• A smartphone penetration rate of 53%
• M-commerce growth of 210%
1. The consumer
As you can imagine, the average Italian consumer is refined and this applies equally to his or her online purchases. A lot of importance is placed on customer service while favoring “love brands” and luxury brands. But there are additional traits.
E-shoppers are still shy
Currently, at least 30% of Internet users practice e-commerce. The average shopping basket value is relatively low, €90 per order, and is made up of less than 4 items. Men and women exhibit similar behavior and the age 25-34 bracket are the most active.
Services are preferred over the purchasing of physical products online, which
currently account for 37% of e-commerce expenditure.
This phenomenon is typical in less mature markets but the trend is beginning to reverse: sales figures for goods increased at a comparatively faster pace (25%) than those for services (13%) in 2013
E-shoppers seek cost savings
The tough economic climate in Italy means that attractive prices are needed to convince consumers to spend online. Some 63% of e-shoppers look for the lowest price as well as free shipping. It’s therefore really an “anti-recession” reflex that drives Italians to purchase online.
It should be noted that while they prefer free shipping, Italians are relatively patient and when they place an order online, they are generally prepared to wait 3-5 days for it to reach them.
2. The market
Despite currently lagging behind, the Italian market has much potential. In addition to the difficult economic situation and bargain-driven e-shoppers, there is a lack of dynamism in the local offering. In fact, 20% of online shops generate 70% of Italy’s e-commerce sales revenue.
A market of (foreign) pure players
Pure players take a lead role on the Italian e-commerce stage. They account for no less than 53% of market share. They do not comprise local companies, but primarily foreign brands. Italian brands do not seem capable of keeping up with the pace of demand that is constantly increasing.
E-commerce sales still only account for 3% of total Italian retail sales.
E-shoppers and e-tailers who are committed to cross-border
Cross-border e-commerce is developing at its own pace, both inbound and
outbound.
32% of e-shoppers make purchases on foreign sites. The main 3 destinations are the U.K., U.S. and China.
Online shops are just as ambitious in their international approach and 55% of them have already thrown themselves into the e-commerce cross-border adventure and make 27% of their revenue through sales outside of their own borders. These sales are made mainly in France, Germany, U.K., U.S. and Switzerland.
Some even dare take on the promising Chinese market. For example, the Yoox
platform has become one of the first international players to associate itself with WeChat, which offers users an instant messaging service to purchase its products live via Chat.
3. Trends
While the economic situation in Italy has had a negative effect on e-commerce, nobody doubts that the recovery announced for 2014 will help turn things around.
New trends, such as the increased uptake in smartphone shopping, will help to
develop e-commerce too.
A path heading directly towards mobile
Italy may well become one of the countries where m-commerce will outpace
e-commerce. In fact, sales on smartphones experienced a real boom in 2013, reaching 510 million euros with growth of 257%. This is hardly surprising as 58% of Italians already have a smartphone. They are strongly encouraged by a 4G offering which has been available since 2012. It is expected that sales on smartphones will account for 1/5 of e-commerce sales in 2014. Sales on tablets are also doing well and reached 900 million euros last year.
Better use of infrastructures
Among the many expected changes and developments, it is hoped that there will be an improvement in the local infrastructure. In fact, the geography of Italy (the country is relatively long and narrow) has certain special features that may present a local challenge. These include its many residents on the islands and in the mountains where e-tailers need to be able to offer the best possible shipping experience.
Improvements to infrastructure will make logistics and returns management easier, allowing e-traders to meet the expectations of consumers, who still prefer to be able to make returns at familiar points of sale.
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