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E-commerce in France: Market entry pays off

by Editorial Office

Alongside the United Kingdom and Germany, France is one of the leading e-commerce nations in Europe: in 2020, 112 billion euros were generated by online retail in La Grande Nation. The trend has been rising for years – entailing great potential from which international providers can also benefit.

France: Growth market with a lot of potential

With annual growth of between eleven and 14 percent recorded since 2016, the French e-commerce market has been on a growth trajectory for some time. The corona pandemic continues to reinforce the shift from bricks-and-mortar retail to e-commerce: According to the French industry association Fevad, online sales of products and services rose to 112 billion euros last year.

Experts such asThomas Métivier, marketplace director at Cdiscount, claim that France is at a turning point. After all, the share of online retailers has been growing particularly fast during the pandemic. Local consumers, including many older ones, are increasingly discovering online shopping as a convenient and secure shopping option. It is assumed that, due to its convenience, there will be a lasting change in user behavior and that online or mobile shopping will remain popular long after the pandemic.

Platform affinity: consumers appreciate choice and service

Online trading platforms in particular are among the beneficiaries during the pandemic: French customers are convinced by the selection and services they offer, such as the fast shipping of goods. Accordingly, marketplaces grew by an average of 27 percent in 2020 – significantly more than in 2019.

With around 152 million visitors per month and more than 200,000 active marketplace sellers, Amazon is a top dog on the local market. Alas, the international online auction house eBay, which has been present in France for more than 20 years, is also very popular: Sales and the number of new customers have risen sharply during the pandemic.

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Alternatives to Amazon and eBay: Local marketplaces in France

However, the first port of call for online shopping also includes local platforms such as ManoMano – dubbed the “Amazon of DIY stores” – or the discount online retailer Cdiscount. The latter has positioned itself as a generalist on the market, offering its ten million active customers almost every product category in addition to its main segments of household goods, technology and food.

Together, the major platforms cover the entire spectrum of local target groups and offer retailers a wide range of opportunities to enter the market with a manageable risk.

Cross-border e-commerce: marketplace presence pays off

The largest market segment in the fashion-savvy  Republic of France is still clothing: According to current statistics, sales are expected to reach 517.30 euros per capita this year. Cosmetics, toys, leisure and home products are popular online purchases, as well, followed by electronics and books.

Up to now, purchases in France have mainly been made from domestic suppliers: six out of ten consumers prefer local offers. However, for more than one third of consumers, the country of origin is no longer a decisive purchasing argument – they order from both French and international suppliers.

This attitude is reinforced by the seamless integration of international retailers on the platforms. Nevertheless, in order to offer local consumers the shopping experience they are used to, it is essential that foreign brands and companies meet local requirements. Above all, adapted delivery and payment methods are important, but so is the growing trend toward sustainable consumption.

Cross-border logistics: matching local service levels

French consumers are used to a high level of service in terms of delivery times. Therefore, an experienced logistics partner who ensures on-time delivery of goods should be part of the repertoire of international e-commerce retailers. To shorten delivery times and keep shipping costs low, it often pays to store goods in Europe. Especially for retailers who do not use the services of online marketplaces, a cross-border fulfillment partner proves to be a great support, as this partner has established logistics networks. Hermes International, a division of Hermes Germany, is happy to provide interested retailers with full support in all logistics matters: from fulfillment and customs clearance to the delivery to the end customer.

The French also have clear preferences when it comes to delivery options: According to the Europe 2020 – E-Commerce Region Report by RetailX, 85 percent of consumers prefer to have their ordered products delivered to their homes. A further 68 percent use delivery to so-called “point relais” – parcel stores close to home or offices that cooperate with logistics providers. By contrast, at just 28 percent, picking up ordered goods from stationary retailers is a far less popular shipping method..

Online payment in France: Eight out of ten French online shoppers pay by card

When it comes to the regionally preferred payment methods, payment by credit or debit card is most popular. Studies such as the Retail X-Report show that eight out of ten French people prefer to pay accordingly prior to receiving their goods. International vendors who sell in France and want to avoid purchase cancellations should therefore offer payment via local Cartes Bancaires and Cartes Bleues as well as via established credit cards such as Mastercard or Visa. The payment mix also needs to take into account that consumers are increasingly using their smartphones for online purchases. Therefore, purchasing via e-wallets such as PayPal or Amazon Pay should also be allowed.

M-Commerce in France: More Traffic via Smartphone

Compared to other European e-commerce markets such as Great Britain or Scandinavia, France may still be falling behind in mobile commerce, but there is growth in the area as well: According to experts, French m-commerce is developing four times faster than conventional e-commerce. The industry association Fevad recently reported that mobile traffic is higher than desktop traffic at all of the top 15 companies. For online retailers operating their own online store, customized shopping apps are therefore becoming increasingly important for m-commerce. The app can be used to securely store customer data and payment information.

Alongside product selection, payment and delivery speed, security is one of the decisive arguments for online purchasing – if they cannot be guaranteed, French consumers will quickly shift to the competition.

Market entry in France: Observing success factors

International brands and companies looking to expand their e-commerce activities will find promising opportunities in France. The market has been growing in double digits for years and still offers great potential. The pandemic has been further accelerating the shift towards online or mobile shopping – a trend that is expected to continue.

However, market entry must be strategically planned. In addition to service-oriented logistics, the localization of one’s own offering, including payment processing and marketing, is one of the most important factors for economic success in French e-commerce.

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