Spanish E-commerce: Grim or exciting? Which will it be?

Three weeks ago, Patricia Fernandez de Lis of El País, wrote a rather discouraging article on the state of E-commerce in Spain. Online sales “are stuck in Spain, where only 5% of the population buys on the internet.” The article stems from a recent study, eEspaña produced by the Auna Foundation, which paints a rather grim picture of e-commerce progress (or lack of) in Spain, who runs far behind its European counterparts. There is a lot to be said about the article, since in many ways numbers don’t lie. However, only recently, Multilingual Search along with many others published something that ran with a much more positive ring—Spanish e-commerce grew 20% in the last year. So who’s right?

Last trimester in 2004, sales increased 7%, whereas the one before showed 14% growth and the first trimester reached 24% growth. Not only did the Auna Foundation discover the alarming growth decrease, but most importantly, according to Eurostat, only .4% of Spanish businesses sell online. For those of you who haven’t caught on, that puts Spain far behind the 2.1% European average. Germany, for example is at 2.7% and Denmark at 4.4%. To put all that in perspective, the 5% of the Spanish population that shops online, is far from Europe’s 16% average and worlds away from Luxemburg’s 32%.

But this is not about being discouraged, in fact, something doesn’t quite fit. The reality is, Spain is going through one of its most exciting moments. Spain is behind, but it’s not stuck. Let’s take a closer look. Aspherio is a pan-European e-commerce solutions provider. E-commerce is their game. Here is what Nicolas Meriel, Aspherio’s Interactive Marketing Manager had to say:

“While turnover is proportionally lower than for example in UK or Germany, sales are growing very strongly in our Spanish online shops, in comparison to UK or Germany where transactions show more a stable trend. Expressed in numbers, we can observe an increase in online sales that is 10 times higher in Spain than in Germany or France and 2.5 times higher than in the UK in the B2B sector comparing 2004 and 2005 figures, over the same fixed period. These numbers clearly indicate that Spain is in a growth phase while some north European countries enter into a more stable phase, showing less growth and others might even start to reach a saturation momentum (Scandinavia).”

Perhaps it’s all about from which angle you look at the numbers. There are two major obstacles that keep e-commerce growth from climbing in Spain. It’s no secret. Patricia Fernandez mentions both in her article. The first is lack of trust. The Spanish online consumer is still not comfortable giving out his personal information in fear of having their personal information end up in the wrong hands. The other hurdle is more logical. Internet use penetration is still lower in Spain than in other European countries. But both obstacles are diminishing. Just the other day Spain reached 4 million high speed connections and with decreasing monthly DSL fees, that number is bound to grow quickly. According to Forrester, 2006 might very well be the big year for Spain.

The trust factor is another story and perhaps the more difficult barrier to eliminate. But even here there are efforts. For example, just last week, Kelkoo and Bankinter, a popular online bank, signed an agreement to join efforts and promote Kelkoo Express as a Bankinter’s Epagado.com’s trusted stores. The agreement is a step forward to help encourage e-commerce in Spain. Kelkoo Express helps businesses, small and large promote and commercialize their products online. Epagados allows their users to safely receive and send money, through a sort-of online wallet, much like PayPal. With ePagados, users don’t have to worry about paying with their credit cards. Bankinter is a well known bank, and ePagados already has 100,000 faithful registered members. Although small, even that is a good sign.

Or as Nicolas Meriel says, “While research indicates that broadband connections have a direct impact on e-commerce growth, education and socio-cultural heritage are unlikely to change at the same speed. On the other hand next and future generations growing up with Internet as a standard household device that exist alongside TV, radio, washing machines or mobile telephones might be much more familiar and relaxed with Internet and in turn with online shopping than the average Spanish consumer of today. Time will tell.”

The picture is not so grim. In fact, the less grim it’s painted, the more education provided, and the more effort injected in eliminating those barriers, the faster Spain will catch up to the crowd.

Sources:

El País
Yahoo España Noticias

One Response to Spanish E-commerce: Grim or exciting? Which will it be?

  1. Pingback: MasterCard study takes the black eye out of Spanish online spending | multilingual search

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