European Net Retail Crosses The ¿100 Billion Mark — And Keeps Growing
2006 shows some remarkable eCommerce stats: 100 million European online shoppers will spend an average of ¿1000 each, and drive online retail past the ¿100 billion mark. Online retail sales in Europe will more than double in the next five years, to ¿263 billion in 2011, according to Forrester Research (Nasdaq: FORR), as the number of online shoppers grows to 174 million. Fueled by improved supply and aided by comparison shopping sites, a more confident online shopper will increase his average yearly Net retail spending to ¿1,500. In the UK, Net consumers will outspend even their US counterparts online. The winning Net purchase categories are travel, clothes, groceries, and consumer electronics, all above the ¿10 billion per year mark.
Jaap Favier, Research Director Consumer Markets at Forrester Research, comments: “The number of Europeans shopping online has increased by 37% in the past two years. At the end of 2003, 48% of Europeans went online at least once per month, and 19% had shopped online; two years later, these numbers had soared to 54% and 26%, respectively. The average online shopper has increased his quarterly Net spending by 10%, from ¿244 in Q4 2003 to ¿268 in Q4 2005. Combined with the increase in the number of online shoppers, total European eCommerce grew 50% in two years.”
Country Highlights: The UK Will Still Lead Online Sales In 2011
The UK continues to head up the European league of online spenders, as forecast by Forrester, followed by Germany. The average UK online shopper will spend ¿1,744 online in 2006 and ¿2,410 in 2011, driving UK eCommerce from ¿43 billion in 2006 to ¿76 billion in 2011, 29% of total European Net retail. The average German online consumer will almost double his online purchases, from ¿786 in 2006 to ¿1,441 in 2011 ¿ almost half of what UK Net consumers spend online. The sheer scale of shoppers ¿ 43 million in 2011, a quarter of all online European shoppers ¿ ensures Germany’s strong second place on Europe’s eCommerce map.
In the coming years, the growth of the French online retail market will outpace that of the UK and Germany, more than tripling its size to ¿39 billion in 2011. Online spending per French Net shopper will remain roughly on a par with the European average. The online retail market in the Benelux is and will remain roughly half the size of the one in France. But the Benelux market is far from uniform: The Netherlands has the most Net shoppers, but their yearly online spend is low ¿ only ¿688 in 2006, compared with ¿851 in Belgium.
As the Nordics finally embrace eCommerce, the average online spend per Net shopper in Sweden and Norway is almost as high as in the UK; online Swedes will raise this to more than ¿3,000 by 2011, including spending more than ¿300 on clothing online. Online Danes today spend less than half of what their Norwegian counterparts spend on the Net, but will reduce the gap by quadrupling their online spend by 2011.
Spain and Italy together make up a quarter of Western Europe’s population and a fifth of its Net population, but jointly account for less than 7% of its eCommerce. In the next five years, their share of online retail will gradually rise to nearly 10%. While Portugal and Greece trail their Mediterranean neighbors, Switzerland and Austria are at the other end of the spectrum: Their share of online retail will keep pace with Germany’s.
Leisure Travel Remains The Top Money-Spinner
Online Europeans learned to shop online at sites like Amazon.com and Expedia.com for CDs, books, and airline tickets ¿ products that don’t necessarily offer the great high-street shopping experience that shoes do. But the more experienced online shoppers keep expanding their Net purchase categories. For example, online sales of alcohol and sports equipment will see the highest growth in the next five years ¿ 283% and 245% ¿ respectively, although jointly they won¿t account for more than 4% of total online purchases. As a result, online travel has lost some ¿ although only a fraction ¿ of its massive lead.
Favier states: “Today, one in three of the euros, pounds, or kronor that consumers spend online go to leisure trip bookings. Online travel spending will grow by 133% to almost ¿77 billion in 2011 ¿ making it the biggest grower in absolute terms ¿ but its share of total retail will decline to 29%. Clothing will see its online turnover grow from ¿10 billion in 2006 to more than ¿31 billion in 2011. Big winners will be catalog retailers like Neckermann, Otto, and La Redoute, which are refining their decades-old CRM best practices for the Net. Along with travel and clothing, food and beverages and consumer electronics will see Net revenues increase to more than ¿10 billion across Europe as the likes of Ahold and Media Markt keep persuading consumers to click the ‘buy’ button.”
The research report mentioned in this release, Europe’s eCommerce Forecast: 2006 To 2011, is available to Forrester WholeView2 clients.