Consumers’ lower propensity to shop was once again reflected in significantly lower overall sales in German e-commerce in 2023, according to the German e-commerce association bevh. Gross sales of consumer goods fell by 11.8 percent to €79.7 billion for the first time in 2023, compared to €90.4 billion in the previous year. The share of e-commerce with goods in total retail (including food, but excluding pharmacy sales) is likely to have fallen to 10.2 percent in 2023 (2022: 11.8%). Overall, this resulted in industry sales in total e-commerce (goods and services) of less than €100 billion – a first since 2020. Including sales generated by phone, fax or other ordering media, total sales in 2023 amounted to €93.6 billion.
Declines affect all types of retailers
For most German online retailers, 2023 will be remembered as a dramatic year. DTC distributors were the most stable in terms of long-term growth. Although sales fell by 11.1 percent last year, they are currently 62 percent higher than before the outbreak of the pandemic in 2019. Marketplaces (-8.5%) and online retailers (-14.7%) also remained significantly below the previous year’s result in 2023 but were still 19.0 percent and 7.0 percent above their pre-coronavirus figures, respectively. The decline in sales was most noticeable in multichannel retail (-18.1%) because customers were increasingly returning to brick-and-mortar stores.
Consumers deal with smaller budgets
The level of customer activity in online retail continued to cool down last year. The proportion of regularly active online customers who have made a purchase within the previous seven days fell to just 34.3 percent. This is significantly lower than in 2019 when the annual average was still around 40 percent and still below the average of the past four years. However, there are cautious signs of improvement in the order frequency per customer, which can be seen in the proportion of those placing multiple orders, making more than one purchase within the last seven days. The figure initially plummeted by around 10 percentage points since Q1 2022 but has since held steady again and has been moving slightly upwards for the past three quarters to currently 35.9 percent.
Preloved purchases become more popular
The willingness to buy less expensive but well-preserved used goods (“preloved”) is now clearly pronounced among younger people and families, especially as e-commerce provides the best access to a wide range of different re-commerce providers. Among 19- to 29-year-old German respondents, 18.4 percent said they order used products online “more often” and 31.9 percent “occasionally.” The 30-39 age group also showed a similar level of acceptance, with 11.7 percent and 40.1 percent of respondents stating this, respectively.
The level of scepticism towards cheap foreign suppliers is currently falling: When asked whether customers (of all age groups) are already willing to shop in foreign stores if the prices are lower, 22.1 percent “completely agreed”, significantly more than in the comparative survey from 2022 (16.8%). Overall, 61.0 percent of customers would currently “somewhat” or “completely” prefer a foreign provider if it was cheaper to shop there.
End of the downward trend in sight
In addition to the tense economic situation and uncertain future prospects for many households, the political environment remains particularly challenging for online retail. However, bevh and the EHI Retail Institute assume that the downward trend will come to an end in the course of 2024 and that nominal sales growth of 2.0 percent can be expected in the overall market for the full year.
