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Low Point in German E-commerce

Last year marked a significant downturn in online product spending in Germany, marking the first instance of a double-digit decline in this sector.

Low Point in German E-commerce

According to data released by the Bundesverband E-Commerce und Versandhandel Deutschland (bevh), also known as the Federal Association of E-Commerce and Mail Order Germany, expenditures totaled 79.7 billion euros, indicating a substantial decrease of 11.8 percent compared to the previous year's 90.4 billion euros in 2022.

This decline, highlighted in the report titled "Ecommerce Turnover Reaches a Low Point," follows a notable 8.8 percent drop in online product expenditures observed in 2022 compared to 2021. The bevh attributes this trend to a reduced consumer willingness to spend money, resulting in decreased online spending across various categories, notably books, computers, jewelry, shoes, and clothing.

The data underscores a prevalent trend of thriftiness among German consumers, particularly evident in their online purchasing behavior. The share of online revenue in product sales within Germany saw a decline from 11.8 percent to 10.2 percent, indicating a relative preference for physical retail over online platforms, especially in the post-coronavirus era. However, despite the decline in product spending, online consumer spending on services experienced a notable increase, rising by 12.7 percent to reach 12.7 billion euros.

While the overall figures depict a downturn, there are signs of improvement in online turnover over the course of the year. Despite a 15 percent decline in expenditures during the first quarter of 2023, this rate more than halved by the fourth quarter, marking a shift from consecutive quarters of double-digit declines to a single-digit turnover loss percentage for the first time.

Looking ahead, although spending continues to decrease, bevh anticipates stabilization throughout the current year, with a subsequent resumption of growth in online expenditures. A joint forecast by bevh and the EHI Retail Institute predicts a nominal growth rate of 2.0 percent for e-commerce in Germany, where Amazon remains the dominant market leader. This forecast suggests a cautious optimism for the future trajectory of online spending in the country.