Domestic e-commerce will perk up as Christmas approaches – growth of nearly seven per cent in the third quarter

According to the recent Verkkokauppapulssi* survey by Digital Commerce Finland, the Federation of Finnish Special Commodity Trade ETU and the Finnish Commerce Federation, e-commerce in Finland grew by nearly seven per cent in the third quarter of this year when compared to the same period last year. Meanwhile, according to Statistics Finland, sales in the retail sector as a whole increased by 1.8 per cent and sales in the specialty goods sector increased by 0.5 per cent. The sales of online stores remained unchanged when compared to the previous quarter.

As the year has progressed, online retailers’ expectations of cross-border online sales have developed in a conflicting manner. On one hand, the expectations of rapid annual growth of over 10 per cent in international online sales have even been slightly strengthened by the previous Verkkokauppapulssi company surveys. On the other hand, the number of companies with no expectations of growth has also increased. Online stores that have sold to the United States’ market are finding the near future to be particularly challenging. Just over half of Finnish online stores also export.

“Although turbulent geopolitical times create uncertainty for all online stores, the online stores in various fashion and interior design sectors and cosmetics in particular expect strong growth in cross-border online sales. Brands in these sectors clearly believe in the quality and international appeal of their products,” says Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation, explaining the results of Verkkokauppapulssi.

Price competition of Chinese e-commerce blurs perceptions of prices

In the domestic market, 38 per cent of online stores expect rapid growth of more than 10 per cent in the next 12 months, compared to just under 36 per cent in August. Although the belief of online retailers in the acceleration of growth has strengthened during the spring and summer, Finland’s financial situation and the weak trust of consumers are still seen as the largest obstacles to the growth of online sales. Many domestic online stores also feel that insufficient marketing resources and high transport and freight costs slow down the growth of both domestic and international sales.

“Online stores are also concerned that foreign low-price brands and Chinese low-price commerce will turn consumers’ perceptions of prices unrealistic,” says Mirva Sandström, Digital Commerce Director at Digital Commerce Finland, describing the challenges of online stores.

Online retailers’ expectations are strengthening as the Christmas season approaches

As Christmas approaches, the expectations of growth in online sales in Finland for the next three months have strengthened from the late summer. 41 per cent of online retailers now expect rapid growth of more than 10 per cent in online sales in the coming months, compared to just 37 per cent in August. According to Verkkokauppapulssi, the strongest expectations of growth for the near future are aimed at products in different fashion and interior design sectors, but the outlook for sporting goods has also improved.

“The end-of-the-year seasons from Black Friday to Christmas have traditionally been important for the sports goods trade, the sales of which are also affected by unpredictable weather,” says Ulla Pöllänen, Managing Director of the Federation of Finnish Special Commodity Trade ETU.

*Verkkokauppapulssi is a company survey for online stores operating in Finland that is carried out quarterly. It typically receives responses from approximately 100–200 companies. The respondents receive an e-commerce report that discusses the development of e-commerce more extensively than the results of the survey and also utilises other sources of information. Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation, is responsible for analysing the results of the company survey and producing the content of the e-commerce report.

For further information, please contact:

Jaana Kurjenoja, Chief Economist, Finnish Commerce Federation
Tel. +358 (0)40 820 5378, jaana.kurjenoja(at)kauppa.fi

Mirva Sandström, Digital Commerce Director, Digital Commerce Finland
Tel. +358 (0)400 984 141, mirva.sandstrom(at)digitalcommerce.fi

Ulla Pöllänen, Managing Director, Federation of Finnish Special Commodity Trade (ETU)
Tel. +358 (0)50 300 1660, ulla.pollanen(at)etu.fi