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German ecommerce shows signs of growth

German ecommerce shows signs of growth

During the second quarter of this year, online sales in Germany increased 0.2 percent compared to that same period last year. This is the first market growth in two years. However, when looking at the first half year of 2024, sales are still 1.2 percent lower than last year.

This information is reported by the Bundesverband E-Commerce und Versandhandel Deutschland, or Bevh for short. In 2023, the association announced that ecommerce in Germany decreased 11.8 percent compared to the year before. The total online revenue amounted to 79.7 billion euros. This was the first double-digit decline of the German market.

38.1 billion euros in H1

But now it seems that the downward trend is coming to an end. From April to the end of June, the total online sales in Germany were worth 19.2 billion euros. And in the first half of 2024, the online revenue reached 38.1 billion euros. This is 1.2 percent below the first half of 2023.

The sales of digital services increased 4.2% in the second quarter of this year

The largest driver behind the growth seems to be the sales of digital services. This includes travel bookings and ticket purchases. This category increased 4.2 percent, to 3.72 billion euros in the second quarter. In the first half of the year, it increased 8.4 percent, to 6.45 billion euros.

Growth across product ranges

According to the report, sales grew in 12 of the 19 product ranges that were surveyed among consumers. Food orders shows the strongest growth, with a 6.2 percent increase (to 1.004 billion euros) in the second quarter. Furnishings (furniture, home textile and household appliances) increased 1.6 percent in that period.

‘Normalization in the market’

“We are seeing the beginnings of a normalization in the market. Incomes have not only overcompensated for the inflation of recent years – around 20 percent since 2019 – but are now experiencing a significantly lower inflation rate”, says Martin Groß-Albenhausen, Deputy General Manager of the Bevh.

‘The next factors for uncertainty are already waiting’

“But it is too early to say that the consumer crisis is over, as the next uncertainty factors are already waiting. Whether in Germany, Europe as a whole, or the USA: everywhere we see political destabilization and geopolitical conflicts that could slow down a return to growth. In addition, there are now reports of numerous bankruptcies, which are driving people to save.”

The strong drop in sales of the past years has not been made up for yet. This means that the current growth will need to continue, in order for German online companies to really profit from it. The association surveyed B2C online retailers and almost half of them say that German and European legislation is holding ecommerce companies back. The rise of Asian marketplaces like Temu can also endanger competitiveness of local companies.

Driven by marketplaces

The report also shows that the German ecommerce market is currently recovering thanks to online marketplaces. These businesses grew 2.3 percent in the second quarter and reached a market share of 55 percent for the full first half of 2024.

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Pleuni

Pleuni writes all types of news and background articles for Ecommerce News, where she has been working since 2019.

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