Understanding The Irish ECommerce Customer
Irish Ecommerce habits have evolved quickly, in comparison to European-wide online customer behaviour.
According to Eurostat, 81% of Irish homes have broadband as of 2014, which means at least 3 million people are online across Ireland, with the average time spent every week at 13.5 hours. Comparatively, that places Ireland at the top end of Internet coverage and usage throughout Europe.
An Overview Of Ecommerce In Ireland
Those 13.5 hours are consumed unevenly across age groups, with under-twenties spending twice as much time online as over 35’s. Shopping is only one aspect of Irish customers web use. Media consumption has increased exponentially in recent years, with Mediascope research highlighting the fact that:
“81% of internet users watch TV online, above the EU average of 73%. 66% listen to the radio online, and 89% read newspapers online which are both on par with the EU average.”
Netflix, the TV and movie streaming service, already has over 200,000 subscribers in Ireland, with local media streamed through RTE Player also proving popular.
Mobile Internet use, both on smartphones and tablets is 50% higher in Ireland than the EU average, with over 31% of the population regularly accessing the web on a mobile device. For retailers, this ought to highlight the importance of mobile design, particularly for eCommerce brands.
Approaching the Irish consumer from the perspective of media consumption should give us an idea of what they expect when it comes to retailers. Online and mobile adoption has been quick, compared to European averages. Digital media consumption has also taken place faster than amongst European neighbours.
It should be no surprise then that the percentage of Irish consumers who’ve made an online purchase is higher than the European average, with 97% of Internet users shopping online, according to Mediascope data. This compares to 87% for the EU.
Interestingly, within this data is a high percentage of online shoppers who research online and purchase offline (ROPO), at 88%, based on 2014 figures. The report also highlights that average online spending is €685.00, with most customers using the Internet to research and purchase across ‘a range of markets, especially travel, holidays, mobile, financial products and insurance.’
One of the biggest challenges for Irish retailers is that consumers are spending considerable amounts with foreign retailers. Despite more being spent online every year, with 2012 spending in €4.1 billion, compared to €2.96 billion in 2011, most of this – at least 75% – according to EuroStat figures, is spent with retailers based abroad. Good news for retailer in the rest of the EU, less so for local eCommerce businesses.
Estimates are on track for €5.7 billion to be spent in 2016, which accounts for 7% of all consumer spending in Ireland.
What We Can Learn About Irish ECommerce Customers
For Irish retailers, this represents a massive untapped opportunity, if they can make their online shopping experience as smooth, secure and user-friendly as foreign-owned retailers. American giants, such as Amazon and eBay made early gains in this market that they’ve held onto, along with clothing and apparel brands, most of which result in Irish money going overseas.
In comparison, despite the Irish consumer jumping on the media consumption and social networking bandwagon quicker than others across Europe, the Irish retail sector was slow to catch up. The high (88%) percentage of customers who research online but shop offline, in physical stores, demonstrates that they are not looking for the most user-friendly online experience, but just a bargain.
Again, this represents a massive untapped opportunity for retailers.
At least two lobby groups, eMark and eCommerce Ireland were established in 2013, to help Irish businesses successfully establish a presence online. Colm Griffin of eCommerce Association Ireland, in an interview with the Digital Times, said, “Every single percent we can pull back would result in a €40 million boost to the local economy and ensure that more Irish-based online stores can survive, grow and create employment.”
Around the same time as lobbying groups were established, a noticeable shift occurred amongst Irish consumers, as a result of investments from major domestic retail brands. Wolfgang Digital, an eCommerce specialist digital agency, noticed a 25% increase in spending amongst ‘from iconic Irish retail brands such as Brown Thomas, Easons and Dunnes Stores. Irish retailers are now investing in meeting the growing online demand for their products.’
Since 2014, Wolfgang Digital have noticed a steady increase, with their latest study showing that domestic E-commerce spending is up 62%. Here are some of the key takeaways from their Q2 2015 report:
- E-commerce spending is up 62%
- Year-on-Year traffic to Irish e-commerce sites has increased by 28%
- Mobile traffic is up 64%
- Tablet traffic is up 26%
- Mobile traffic share is growing, up from 29% to 37%
The dual impact of nationwide 4G mobile and 4G broadband rollout has greatly improved customer’s online shopping experiences, with domestic retailers continuing to invest in E-commerce and multi-channel campaigns.
The reluctance, on the part of Irish customers to shop with local brands, was the result of the intersection of two circumstances prevalent in 2012-13. Firstly, foreign retail brands, thanks to gains made in other European countries and America, already had the infrastructure and brand awareness in place to dominate the Irish market early on. Secondly, Irish retailers took longer to catch up across multiple digital channels and failed to get ready for the shift from browsers to mobile devices.
Irish retailers have also had to play catch up in another key area: security and convenience of online payments. User experience is everything, especially on mobile devices. The smaller the screen, the fewer clicks customers expect to make when they are at the basket stage. For convenience, customers also need choice, which means keeping pace with the wide range of digital payment options now available; all of which must be interconnected with the security and convenience of the experience.
Irish retailers are finally competing, on a click for click, a channel for channel basis with foreign brands, which means we are about to witness a consumer-led fight for a slice of this exciting, high-growth retail market.