E-Commerce in FraNCE
OPPORTUNITIES FOR FOREIGN ONLINE SHOPS
British online shops have great market potential when expanding into France. One option to ensure successful entry into the French market is through keeping shipping costs on the UK level. French customers generally pay high delivery costs to merchants. This results in a competitive advantage over French sellers. Convince potential French customers with your larger product range and offer free returns.
Germany is the No 1 shopping country for French buyers (76%), meaning that more than three-quarters of French buyers are willing to source products from Germany, when purchasing outside their own borders.
Being the world's third-largest E-Commerce exporter, Germany is particularly successful on the French market. The online turnover of German goods sent to France sums USD 580 million.
FACTS AND FIGURES
France ranks third place in Europe after the UK and Germany. The country has an internet penetration rate of 86% and almost 90% of all Internet users buy online. The French E-Commerce market is one of the most developed markets in Europe
The infrastructure in France today is well established: Full coverage of broadband networks is now over 60% in the Paris area and the touristic regions in southern France. The densely populated regions in the Northeast benefit from over 70%.
When it comes to online shopping, leading regions with percentages ranging from 55% to 70% are the Ile-de-France and Paris along with Aquitaine, Midi-Pyrénées and Limousin.
24.1 million French people own a smartphone and mobile buying is a rising trend. Compared to other markets, the French are still quite cautious with mobile shopping: according to a study by PricewaterhouseCoopers, only 26% use their Tablet for online shopping, 25% their smartphone. Worldwide the average percentage of mobile device use is more than 40%.
Nevertheless, 70% of all mobile phones purchased in France are smartphones, and the proportion of mobile shoppers is increasing rapidly. With an increase of 70%, mobile shopping amounted to 20% of online turnover in 2017 (10% in 2010). M-Commerce today is already 25% of the total E-Commerce sales.
DIFFERING PAYMENT METHODS IN AN INTERNATIONAL E-COMMERCE LANDSCAPE
Alongside sales strategies, marketing channels and customer service, providing the appropriate range of payment options is one of the most vital ingredients for running a successful online retail business. Customers who can’t find their preferred method of payment at the checkout are more likely to abandon their basket.
In line with the increasing internationalisation of e-commerce, certain payment methods and providers are becoming standard European options – above all credit cards and PayPal. As can be seen in the study, within Europe there are still various country-specific options when it comes to online payment. For retailers, it is important to recognise these and develop the payment offering according to their market. For example, a UK retailer interested in reaching out to Polish consumers would do well to identify the country-specific e-payment alternatives to PayPal, and offer these as payment methods.
The analysis in the chart below is based on the 50 online retailers with the highest national Alexa traffic rankings within the 100 most-clicked shops on idealo.co.uk, idealo.de, idealo.fr, idealo.it, idealo.es and idealo.pl
According to the study étude FEVAD / Médiamétrie the credit card remains number 1 of payment options with 80%. With 27% about one quarter of the Webshoppers use online payment services such as PayPal. The Chèque Cadeau ranks 3rd with 14%. Fourth place is occupied by the Carte Bleue Virtuelle with 11% followed by the "sans frais Plusieurs fois" (installment free of charge) with 8%. This payment method should be offered by merchants for more expensive products.
The biggest French specificity with regard to the payment options is the Scheck. This traditional french payment options is still used by 5% at the virtual checkout. This rather outdated payment method can still be found in more than two-thirds of French shops. What you hardly find in an online shop in France are direct debit, invoice purchase and payment on delivery.
Many players in the French logistics market are currently joining forces. The Japanese E-Commerce giant Rakuten, who took over the French Re-commerce market leader PriceMinister.fr in 2012, also acquired the logistics experts Alpha Direct Services (ADS) at the end of 2012. The formerly state-owned La Poste, together with the e-commerce agency MixCommerce also bought the logistics service Orium in the same year. As early as 2009, La Poste had positioned itself very broadly with the purchase of several pickup services: the logistics company now has more than 5,500 collection points ("Points Relais") in France.
La Poste is competing with UPS among others: The American logistics giant now operates in France after the purchase of 4,500 Kiala pick-up points. Points Relais: The practice of ordering products online and then picking them up at your nearest parcel shop, is used a lot in France. Major providers Mondial Relais, Relais Colis and Kiala now have package stations in over 34% of French shops.
Currently, the growth figures in the French E-Commerce are reaching quite impressive numbers: 12% in 2017, for 2018 Ecommerce Europe expects a continuous growth rate of 10%.
France’s economy—the third largest in Europe—has been struggling for several years, experiencing poor growth, budget deficits and relatively high unemployment, especially among young adults. However, the election of Emmanuel Macron as president in May 2017 and his party’s strong showing in parliamentary elections have boosted consumer and business confidence, signaling an improving outlook.
According to the International Monetary Fund (IMF), GDP in France rose by 1.3% last year, compared with 1.7% in Germany and 2.0% in the UK. The same growth rate is expected for this year, though an increase of 1.6% is predicted in 2018.