A piece of general informationItaly is one of the biggest European countries inhabited by more than 60 million people. It’s also a real tourist trap - in summer 2017, over 50 million tourists from all over the world decided to visit Italy. Among the most popular tourist destinations in Italy, we need to mention Rome, Naples, Milan, and Florence. That’s not surprising, the country provides tasty food, incredible architecture, and impressive history. It’s also worth mentioning that as many as 50 cultural and 5 natural locations in Italy are listed as UNESCO World Heritage sites which makes Italy in a class by itself.
E-commerce in Italy - The Market In NumbersE-commerce is developing at an incredibly fast pace and this trend has been continuing for several years now. It was estimated that in 2018 the turnover in the e-commerce market amounted to 32.4 billion USD, which equals an increase of 15% when compared to 2017. On the other hand, the sale of goods and products via the Internet increased by 25% in 2018, and the total market value amounted to 18 billion USD. The main factors stimulating the development of e-commerce in Italy are:
- The improvement of Internet access and greater availability of broadband Internet,
- The huge prevalence of mobile phones and smartphones (in this respect, Italy is one of the most developing countries in the world),
- The improvement of transaction security,
- The Italian law recognizing the legal validity of digital signatures and digital contracts,
- The possibility of buying products at lower prices than in brick and mortar shops.
Italy & E-commerce - a few words about Internet usersWith every year the Internet in Italy is getting more and more popular - as many as 89% of the inhabitants are active Internet users. In recent years, companies, public institutions, and private users have been particularly eager to take advantage of the opportunities provided by online services. As you can see in the graph below, the percentage of Internet users in Italy has been steadily increasing in recent years. In 2006, only 34.1% of Italians used the Internet while in the previous year (2018) the number increased twice (the difference equals 34.4%). Moreover, it’s likely that the trend will continue in the upcoming years. So as you can see, when it comes to Italy, the e-commerce market has huge potential and it’s worth investing in. [caption id="attachment_17455" align="aligncenter" width="1029"] The percentage of the Italian inhabitants using the Internet.
Social mediaOver the last 10 years, the development of various social media platforms has significantly influenced the marketing strategies of the e-commerce market. During the first three months of 2018 this sector was dominated by Facebook and 71% of the Italian companies regarded it as the most effective social media platform for various e-commerce purposes. Instagram is the second most popular social media site in Italy - it’s used by 41% of the Italian entrepreneurs. On the subsequent places we can find platforms such as YouTube (35%), LinkedIn (19%), Twitter (13%) or Google Plus (13%). In the first quarter of 2018, 25% of companies operating on the Italian e-commerce market were satisfied with social media activities and profits resulting from them, 50% had problems with assessing their usefulness when it comes to e-commerce and 25% considered them to be rather ineffective, claiming that they didn’t affect their sales revenues (source: E-commerce Report, Casaleggio Associati, May 2018).
E-commerce business in ItalyWhen it comes to the most popular online stores in Italy which offer a wide variety of products and aren’t limited to one specific industry, we need to mention Amazon, eBay, MediaShopping, AliExpress, Subito, and Dmail. As you’ve probably noticed, some of the shops, for example, Subito, aren’t available in other countries and are targeted mainly at the Italian e-commerce market. Let’s take a closer look at the situation of various industries operating in the local e-commerce market.
- Traveling and tourism: eDreams, Expedia, Lastminute, Trenitalia, Italo Treno
- Technology and electronics: ePrice, Euronics, Monclick, Mr Price, Mediaworld
- Fashion: YOOX, Zalando, SaldiPrivati, Privalia
- Books, music and movies: Amazon, IBS, Unilibro, La Feltrinelli
- Coupons and vouchers: Groupon, Groupalia
The sales timesEvery year the Italian online stores offering various products and services compete for new potential customers mainly at the time of increased sales such as Christmas, Valentine's Day, and Easter. December is the month when the Italian stores pride themselves on record sales. Over the last few years, the shops in Italy began to introduce discounts on special occasions like Black Friday or Cyber Monday. Moreover, during seasonal sales (July-September and January-March), online shops launch a competitive sales campaign and usually offer higher discounts than brick-and-mortar stores.
E-commerce in Italy Essentials - Italians' shopping habitsAccording to the data provided by Bilendi in 2018, 76% of Italians shop online at least once a month. 18.9% can be considered as the most intensive customers - they buy online at least once a week. On the other end of the spectrum, 18% of Italians shop online relatively rarely - only once a quarter or so. 11.1 million Italians are indicated to be regular customers, meaning those who shop online at least once a month and, on average, every year spend 1,650 USD per person. Interestingly, before making a purchase, many Italians take advantage of online price comparison engines and their recommendations. They opt for TrovaPrezzi.it, Ciao, CompraMeglio.it or Kelkoo.it. Currently, the percentage ratio of services purchased is lower than the percentage of products purchased (44% to 56%). [caption id="attachment_17457" align="aligncenter" width="750"] The percentage share of Italians shopping online and using online price comparison tools.
Which industries and products are most frequently chosen by Italians?Sales in Italy are dominated by customer electronics with 25% of the e-commerce market share (it increased by 18%). The clothing industry is second in the ranking, it constitutes 8% of the market share (it increased by 25%). The emerging industries include food, furniture, interior design, cosmetics, and toys. The tourism industry (32% of the market share, increased by 5%), followed by the insurance industry (6%), is an unquestionable leader when it comes to services most commonly purchased online (source: export.gov).
Italy E-commerce Essentials - Payment methodsWhen it comes to choosing the place of delivery, 92% of Italians opt for their homes or workplaces. PayPal and other similar technologies are their favorite payment methods. Payment by card is also quite popular in Italy, but interestingly, significantly fewer Italians prefer to pay by cash or by bank transfers. [caption id="attachment_17459" align="aligncenter" width="750"] The graph presents how Italians select their payment methods.
Italy E-commerce Essentials - DeliveryConsumers in Italy have been slowly shifting from a slow and unreliable home delivery by post (Poste Italiane) to express and high-quality private delivery. Delivery tracking, offered by most companies, is a function particularly appreciated by Italians. In Italy, the market for the supply is developing rapidly, therefore more and more private companies offer home delivery. The most popular delivery companies on the Italian market are FedEx, UPS, DHL, and TNT. These companies stand out on the market thanks to offering international delivery with an original and effective type of delivery tracking and insurance.
Italy E-commerce Essentials - Using mobile appsMore and more frequently Italians take advantage of various mobile apps and use them to shop. What’s interesting, Italy is one of the world's leaders regarding users purchasing via mobile applications. According to the research conducted by The Polytechnic University of Milan, mobile apps constitute 31% of the total e-commerce market share and 7% of purchases are made via tablets. Generally speaking, 36 million of the country’s inhabitants have mobile phones, 30 million have smartphones and 8 million decided to buy a tablet. Companies start to appreciate mobile applications, therefore, more and more entrepreneurs decide to enable buying online not only with the use of websites but also with the use of special apps. Already in 2018, 57% of the Italian companies had their own mobile apps. Brands offering not only clothing and footwear but also food and various types of accessories or electronics are particularly popular in Italy. As shown in the table below, in March 2017, the Shpock service enabling buying and selling used goods was the most frequently downloaded mobile application. The following places are occupied by AliExpress, eBay, Amazon, and Wish. As you can see, despite the fact that most frequently Italians choose Zalando, in this particular case they prefer shopping with the use of the website, not a mobile app. [caption id="attachment_17461" align="aligncenter" width="750"] The mobile apps the most frequently downloaded from Google Play Store, March 2017.