Online retail in Finland grew by 5.1 percent in the first quarter of the year—faster than the retail sector as a whole. At the same time, online retailers’ expectations—particularly regarding growth in domestic sales—have strengthened significantly, according to the latest E-commerce Pulse report.
According to the latest “E-commerce Pulse”* report from Digital Commerce Finland, the Finnish Specialty Retailers Association (Edu), and the Finnish Commerce Federation, the start of the year was strong for e-commerce in Finland. At the same time, total retail sales grew by 3.8 percent, according to Statistics Finland.
“The growth in Finnish consumers’ purchasing power is beginning to show up in both the retail sector as a whole and in online shopping,” says Jaana Kurjenoja, chief economist at the Finnish Commerce Federation.
Online retailers have high expectations for growth in domestic sales. In the latest Verkkokauppapulssi business survey conducted in April–May, as many as 45 percent of online retailers believe domestic sales will grow by more than 10 percent over the next 12 months. As recently as February, 36 percent expected similar growth.
Expectations for growth in exports have also strengthened compared to the beginning of the year, but they have not yet reached the level seen at the beginning of last year. Expectations for cross-border online sales peaked in August of last year, when customs policies were already expected to have stabilized and interest rates were on the decline.
“Many e-commerce retailers see opportunities for growth in foreign markets, but ongoing geopolitical uncertainty is dampening expectations,” says Mirva Sandström, director of Digital Commerce Finland.
E-retailers continue to cite low consumer confidence and purchasing power in Finland as the biggest obstacles to the growth of online commerce. An increasing number of online retailers also believe that rising logistics costs and the high delivery fees charged by domestic online retailers are hindering growth opportunities. Especially among smaller online retailers, insufficient marketing resources and a lack of marketing expertise are slowing sales growth. “Online retailers are now investing in social media marketing and the development of search engine and AI optimization to accelerate growth,” says Jenni Homer, CEO of the Finnish Specialty Retailers Association (Edu).
*The E-commerce Pulse is a quarterly business survey of e-commerce companies operating in Finland, to which typically about 100–200 companies respond. Respondents receive an e-commerce report that provides a broader analysis of e-commerce trends based on the survey results and draws on other data sources as well. Jaana Kurjenoja, Chief Economist at the Finnish Commerce Federation, is responsible for analyzing the results of the business survey and producing the content of the e-commerce report.
For more information:
Mirva Sandström, Digital Commerce Director, Digital Commerce Finland
Tel. 0400 984 141, mirva.sandstrom(at)digitalcommerce.fi
Jaana Kurjenoja, Chief Economist, Finnish Commerce Federation
Tel. 040 820 5378, jaana.kurjenoja(at)kauppa.fi
Ulla Pöllänen, CEO, Specialty Retailers Association ETU
Tel. 050 300 1660, ulla.pollanen(at)etu.fi
Digital Commerce Finland is a digital commerce community and a community-driven company that helps the digital commerce sector grow faster. The community’s activities include free training sessions for online stores, the eCom Summit & Awards flagship event, data services, club activities, and a shared physical meeting space for digital merchants. www.digitalcommerce.fi
The Finnish Commerce Federation is the voice of the retail sector—the largest industry in the Finnish economy—in society. We bring together the entire sector, from retail and wholesale to e-commerce. We negotiate collective bargaining agreements for the retail sector and advocate for business policy solutions. We work to ensure that Finnish retail and services thrive and succeed in the face of fierce international competition. www.kauppa.fi
The Specialty Retail Association (Etu) helps specialty retailers succeed, both in Finland and internationally. Founded in 1920, the Specialty Retail Association represents 13 sectors in the retail and health industries. The association’s member organizations include more than 900 companies that employ over 40,000 people. www.etu.fi
