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Ecommerce Growth Tapers Off in France

Digital sales grew by 11%, but 2014 may see the end of double-digit annual gains

What’s up with French ecommerce? Recent figures from JDN pointed to increasing maturity in this key European marketplace, but digital sales last year were disappointing.

French business-to-consumer (B2C) ecommerce sales climbed 11.2% year over year in 2013. JDN based its estimates on bank card transactions with digital retailers using the Worldline, PAYBOX Services, Monext Payline and Ogone payment platforms. These four providers handle 90% of bank card purchases at French etailers. Together, they accounted for €40.26 billion ($53.68 billion) in sales during 2013, compared with €36.2 billion ($46.41 billion) in 2012.

Slowing growth is typical of a maturing market, and some decline was expected. But the actual figures were something of a surprise, after rises of around 20% in 2012 and 2011. In addition, the average basket size dropped by nearly €5 ($6.67), to €81.51 ($108.68). Baskets shrank by roughly the same amount in the 2013 holiday season, compared with the equivalent period in 2012.

Yet consumers in France are hardly losing interest in ecommerce. The number of online bank card transactions rose nearly 18% last year. Another encouraging sign was the rapid adoption of one-click payment options, which enable shoppers to store their bank card information with a retailer and check out with a single click, after confirming the order details.

A further development, potentially linked with the growing acceptance of one-click payments, is the rise in shopping and buying with mobile phones, smartphones and tablets. Mcommerce sales have risen much more rapidly than overall sales, according to a spokesman for Worldline.

eMarketer estimates that the number of digital buyers in France will pass 29 million this year and rise by a further 600,000 annually through 2017—ensuring an expanding customer base for online retailers.

Meanwhile, though, it seems clear that the era of rampant growth in B2C ecommerce sales is over. Consumers are buying more often online—and buying with more devices—but paying less in a typical transaction. That may have a lot to do with France’s general economic predicament, however. And most consumers don’t think President Francois Hollande is doing a good job addressing those issues. His popularity has languished between 24% in October 2013 and 31% in January 2014—some of the lowest levels recorded in recent decades. When the French economy eventually picks up, ecommerce will likely show renewed momentum.

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