February 29, 2012, 4:15 PM

Poland leads European e-commerce growth

Analysts project a 24% hike in online sales in 2012 in a growing economy.

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A vibrant economy and growing Internet access are fueling a boom in e-commerce in Poland.

The Centre for Retail Research, a U.K.-based retail research and consulting firm, predicts Poland will register the fastest growth in European e-commerce this year, with a 24% hike in e-retail compared to a European average of 16.1%.

Shopping search engine Kelkoo also is projecting 24% growth in e-commerce in Poland, to 5.59 billion euros (US$7.4 billion) from 4.50 billion euros (US$6 billion). “Poland is getting in on the action, with the biggest increase in online sales in Europe,” says Kelkoo. “Following 33.5% sales growth between 2010 and 2011, a hike of 24% is expected in 2012.”

Poland still has a long way to go to catch up with more developed e-commerce markets in Western Europe. The country ranked last in online retail sales in 2011 in Kelkoo’s analyst of 13 European nations, that also included the Western European countries of Belgium, Germany, France, Denmark, Italy, Luxembourg, Netherlands, Spain, Sweden, Switzerland, the United Kingdom and Norway. And Poland remains far behind Europe’s e-commerce leader, the United Kingdom, where online retail sales will reach 67.4 billion euros (US$90 billion), Kelkoo projects.

Even in Poland, e-commerce is just starting to become a major factor. Online sales will represent just 3.8% of overall retail revenue in Poland in 2012, up from 3.1% last year, Kelkoo says.

But the growth is unmistakable. It is driven in part by Poland’s relatively strong economy, which grew about 4% in 2011 while the European Union’s economy only grew 1.6%.

Another factor is that more Polish consumers have access to the Internet at broadband speeds, including outside of the capital city of Warsaw. The Polish state Office of Electronic Communications say the provision of fast and cheap services for everyone in Poland has been given a big boost from the European Union with a 300 million euros (US$401 million) investment project in broadband Internet in five provinces of eastern Poland.

18.2 million of Poland’s population of 38 million are Internet users, according to web measurement firm comScore Inc., making it the eight-biggest Internet market in Europe. A study from the European Union’s statistical office, Eurostat, says 67% of Polish households had internet access in 2011, far below the 94% of the Netherlands but well ahead of 50% in Greece.

As the Internet become more accessible to millions more Poles, the demand for online stores is spiralling, according to market research firm Euromonitor International.

“An increasing number of Poles are shopping online on a regular basis, attracted by convenience of shopping and competitive prices,” Euromonitor writes in a recent report. “In line with the increasing interest in this channel, a growing number of online stores are emerging.”

Euromonitor says an injection of 390 million euros (US$521 million) of European Union subsidies to e-commerce in Poland already spawned many new web sites between 2009 and 2011.

The number of online stores during this period increased from 7,500 to 10,800, according to Polish market researcher TNS OBOP, which says 47% of internet users in Poland have made an online purchase in the past six months. The clothing industry represents the largest number of new e-retailers with 17% of Polish e-commerce sites selling clothes and shoes.

According to central and eastern European I.T. market researcher PMR, as many as 3,000 new e-commerce businesses may join the existing stores this year.

While such major Polish e-commerce sites as Allegro.pl and Merlin.pl are benefiting from the growth, they’re not the only ones, says Warsaw-based consultant Laurent Jerinte, “Small e-traders are gaining success in niche markets, especially household goods, tourism and fashion,” Jerinte says. He projects the e-commerce sector in Poland will grow by 15% to 20% in the coming years, despite the economic woes of Europe as a whole.

Big international retailers are paying attention, increasingly moving into Poland and introducing new online shopping features. For example, Carrefour Group, the France-based supermarket and general merchandise chain, recently introduced a feature that lets Polish consumers buy products online and pick them up at drive-in locations at Carrefour stores, Kelkoo says. Carrefour is No. 12 in the Top 300 Europe, a listing of the leading online retailers in Europe.

Jerinte says other international players, including U.S.-based Amazon.com Inc. and Tesco Stores of the U.K., Nos. 1 and 3, respectively in the Top 300 Europe, are targeting Eastern Europe’s fastest-growing e-retail market.

“The Polish market is very important to them, not only because it has 38 million citizens, who are all potential consumers, but because of the country's pivotal midway position between Western and Eastern European markets,” he says. “Strategically, it offers a perfect gateway to conquer new countries such as the Ukraine and Russia.”

Grzegorz Wojcik, CEO of Poland’s leading auction website, Allegro.pl, says he is preparing for tough competition, with the arrival of Amazon and Tesco.com in the Polish e-commerce market. Agito.pl sells 50,000 products in 10 departments, including consumer electronics, household appliances, cosmetics, clothing and baby products. 

Jerinte says the dawn of universal Internet access is extending the reach of online shopping beyond the traditional 25-35-year age group, into the over 45s and seniors. The introduction of new electronic payment methods, including strong growth in the CB (Carte Bleu) Visa card brand from France, is contributing to the surge in e-commerce, he says.

Already 70% of Poles shop online several times a year, according to the price comparison portal Ceneo.pl. The forces driving e-commerce growth could swell that percentage in the years ahead.

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