E-commerce and cross-border e-commerce in Germany
- The current state of online shopping in Germany
Germany is the fifth largest market for e-commerce with a revenue of $109.1 billion in 2021. Germany is ahead of South Korea and behind the UK. Germany’s e-commerce market grew at 14%, contributing to the 15% global growth rate in 2021. In 2021, the German B2C e-commerce sector generated revenues of around 86.7 billion euros. By 2022, this figure is estimated at 97.4 billion euros. From these data, it is shown that the German e-commerce market is growing year by year. Online shopping is on the rise and will become more and more popular. With the ongoing Covid-19, online shopping has become the best way to shop without direct contact. Consumers could not go shopping in that period because of non-essential shop closures by the government to curb the spread of the virus, then consumers turned to online orders, waited for delivery, and picked up deliveries without contact. However, before Covid-19, online shopping in Germany was also on the rise year by year. Delivery services and employees of online e-commerce giants such as Amazon are also under pressure. The rise of B2C has made a lot of achievements over the years, but at the same time, it has also brought a lot of discussion about sustainability, employee rights, and ethical production. Although there are a lot of different voices, e-commerce sales in Germany will still have a bright future.
Like people in many other countries, Germans love to shop online. Online shopping is part of everyday life in Germany. According to statistics, 94% of Internet users shop online, that is, about 55 million German citizens shop online. Whether on the couch at home or waiting for the railway, whether using a computer or a smartphone, Germans shop online all the time. Along with this, both e-commerce and offline shopping are expanding their business models. In the end, we hope to achieve a combination of online and offline. 66% of retailers sell products both stationary and online – 25% exclusively stationary and 6% exclusively online. In online shopping in Germany in 2021, clothing was the most purchased by consumers, with 19.27 billion euros in revenue. It is possible that these data have been affected by Covid-19, and online shopping data has replaced some offline shopping data. But overall, online shopping is growing rapidly, and it’s always making progress in serving consumers. The combination of websites and apps, kinds of payment methods, different delivery ways, and other services are becoming more and more convenient. Homepages, social accounts, and online reviews are also very important since most consumers are concerned about these.
- German online shopping sites
As we all know, Amazon, a large e-commerce brand in the United States, dominates the e-commerce market in many countries, but Germany also has its own e-commerce platform. The success of German local brands Zalando, MediaMarkt, and Otto is also the development of German e-commerce by itself. In Germany, the top 10 e-commerce are Amazon Germany, eBay Germany, eBay Kleinnzeigen, Otto, Idealo, MediaMarket, Lidl, Zalando, Thomann, and Saturn. For the first one Amazon, the number of visits per month is about 578.8 million. Although Amazon is a big e-commerce platform founded in the United States, it has also been standing in Germany for a long time. Amazon Germany is the third-largest website in the country and the third-largest e-commerce site in the world. Amazon Germany covers almost all categories, from clothing, shoes, and hats to electronics. It is a very attractive platform for consumers.
- Product categories and online payments
In Germany, around 70% of consumers like to buy clothing, shoes and food, and beverages. 61% of consumers prefer to buy electronics. 58% prefer to buy books, movies, and games and 56% enjoy health products. Consumers are most likely to buy clothing and food, but they are also the most sensitive to the price of these two categories. With the popularity of online shopping, many traditional products can’t provide consumers with a good experience online, so they need to transform. Many services, in particular, must be digitally transformed. For example, from physical books to audiobooks in full length or summarized and from grocery shopping to grocery delivery services are typical. Moreover, 53% of retailers can digitally transform new products and services through the popularity of online shopping. 36% of retailers can expand themselves internationally.
The percentage of smartphone owners in Germany is about 81%, so the e-commerce market in Germany will be relatively large. For example, in 2021, 59% of online shopping was done on smartphones. This is a popular trend, especially with the development of smartphones and major platforms. In these years, online shopping has become more convenient and more general, so online payments have become more common. For payment methods, in Germany, the most common methods are online payment, purchase on invoice, direct debit, credit cards, and so on. Online payment and invoices are the most widely used payment methods.
- Cross-border e-commerce
Due to the popularity of online shopping in recent years, many platforms or large merchants have begun to provide cross-border e-commerce services to meet the different needs of consumers. The continued growth of cross-border trade and the arrival of globalization has given countries many opportunities to trade across borders. Around 70% of German online shoppers have already purchased goods from abroad, and this figure will continue to increase in the future. On one hand, cross-border shopping gives consumers the opportunity to buy products that are not available in the local market. On the other hand, because the price factor has a greater impact on German consumers, cross-border shopping also gives consumers an opportunity to compare products and prices. In addition, most consumers find that international shipping services from many other countries are also very convenient and effective. For consumers, cross-border services can make them buy products with better prices or products that are not available locally. This is a very cost-effective way for them. For sellers, integrating products and shipping can make their products visible to more consumers. Cross-border e-commerce will allow sellers and platforms to have a larger place to show themselves and earn more. Cross-border logistics play a crucial role in this process. Of course, there are also some disadvantages in cross-border e-commerce, for example, duty and customs clearance in Germany are complicated, and the EU has other regulations that sellers need to consider. This requires cross-border e-commerce companies to understand these regulations in advance and arrange time and products reasonably.
Major platforms either open their own cross-border logistics or use international logistics companies to ship products to various buyers’ cities. A question of effectiveness arises in this process. General products, whether by sea or air, take at least a few days to transport to another country. Moreover, there is another time for customs clearance in both countries and the time for land transport to the final consumer’s destination. In order to reduce the waiting time of consumers, the concept of international warehouses came out. An international warehouse is a warehouse that’s set up internationally, typically located in a global trade hub. There are many trade hubs all over the world. This lets the seller deliver goods to customers wherever they are, in a timely manner and with minimal challenges.
Many companies have set up international warehouses in many locations in different countries, which can make products move end-to-end as much as possible. At the same time, inside the warehouse, many companies have integration systems, which allow both companies and buyers to check their product activity in real time. Buyers can check the specific information on logistics, the status of orders, inventory, product quality, and price details. The international warehouse provides a location where the entire cross-border logistics becomes integrated and visualized. In the future, more and more new features will appear. The main purpose is to allow consumers and sellers to use international e-commerce and international warehouses as a visual platform for inquiries and transactions. There are many such companies in Germany, which combine locations and new technology to provide consumers with a more comprehensive cross-border service. It is a sustainable development and visualization service. It has very good prospects and development in the future.
In general, online shopping in Germany has developed very rapidly in recent years. With the development of online shopping, Germany’s cross-border e-commerce and international warehouses have also been driven to develop. Cross-border e-commerce has brought consumers more choices of products and better prices. International warehouses combine geographical locations and technology to bring people better and more visual services, and the technology of Germany’s international warehouses is leading in the world.
