A Nordic view of distance selling
Post&Parcel editor Chris Dolan takes at look at the trends coming out of the Distance Selling in the Nordics 2009 – a study by Posten. With the recession still financially hindering postal companies of all sizes, many top industry executives have relied on the growth in e-commerce as a salvation from the gloom of falling letter mail volumes, cost-cutting initiatives across the board, and the unfortunate decision to axe thousands of jobs within the sector.
This has led to many revelations that Internet shopping will dominate the future of the postal industry. The focus on this emerging sector has been emphasised in Northern Europe, where Swedish operator Posten has released a new study outlining the market growth in their country, as well as Norway, Denmark and Finland.
The report, called Distance Selling in the Nordics 2009, is formed from the results of over 4,000 interviews with individuals in the Nordic region, conducted by Sifo Research International on behalf of Posten. It estimates that Nordic distance selling totalled over SEK 70bn in 2008, which equates to roughly €7.6bn. The study reveals that “Danes and Norwegians purchase products via the Internet and mail order more often than Swedes and Finns do. They also order more products from foreign sites. A total of 12m Nordic residents shopped from home last year.” One in five residents from Norway purchased over the Internet, or via mail order, each month during 2008. Furthermore, 26% of the Norwegian population shop from home, which is only eclipsed by the Danes, where 33% of the population shop online each month. In Sweden, 20% of shoppers prefer to buy from the comfort of their own home, whilst Finland buck the growing trend with only 4% stating that they shop from home each month.
Analysing the breakdown of the total €7.6bn revenue from home-shopping in the Nordic region, the Danes lead the way again, with an average spend of €712 per person, according to the report, this was “somewhat more than the Nordic average (€703). Swedes and Finns spent less money shopping from home. They spent an average of €564 and €556, respectively.”
The cross-borders market was also examined in the study, with results telling us that just under half of Nordic residents who shop online have used a foreign site at least once. Once again, Danes and Norwegians do so most often, while Swedes do so to a lesser extent. Nordic residents shop most often from US and British websites. “Danes and Norwegians shop from Swedish sites to a relatively large extent. Swedes sometimes shop from Danish e-commerce sites, though less often from sites in Norway and Finland.”
Per Mossberg, senior vice president of corporate communications at Posten, believes e-commerce is on the rise and more prominence will be placed on the cross border market within the Nordic region and beyond. He told Post&Parcel: “Our previous studies have shown that Swedish distance selling has grown substantially during the past few years. This study shows a similar trend in other Nordic countries. We see a clear trend that an increasing number of distance selling companies want to expand their market to reach all 25 million Nordic residents. This most likely means that distance selling will continue to grow as it becomes more cross-border.”
“Nearly 50% of the people in the Nordic countries who shop online has bought something from a foreign website. Scandinavians mainly shop from the US and Great Britain. In the Nordic countries the main reasons for shopping online are lower prices, greater convenience and a wider range of choice. For the Swedish post the growing market of distance selling means more packages to handle at our terminals as well as to distribute by our 1600 partner outlets. Furthermore our postmen deliver more and more books, CDs, DVDs and other products that have been ordered online or by mail order directly home to the Swedish households.”
P&P News has reported several times this year that e-commerce is growing as a result of people searching for the best prices – often found online. Guernsey Post’s chief executive told us: “The recession has driven more people to look for value and they are finding that through the Internet.” That view was reinforced in April when we reported Angeline Foong, country product manager of eBay UK, as saying: “We surveyed the top 1,000 sellers on eBay and found year on year growth of around 29%.” Posten’s report continues this trend by citing: “On all markets, price is the primary reason for shopping from home. Price is most important to Danes, 50% of whom highlight this factor. The corresponding figure in Sweden is 40%. Other significant reasons for shopping from home offered by Nordic consumers include convenience and greater range/increased accessibility.”
With the report being published, it seems that postal services are realising where there future lies – and it’s no longer with letters. Only the companies acting now will be able to ride on the wave of e-commerce that will grow even more once the economic uncertainty makes way for a healthier financial climate.
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