According to our e-commerce index the web shops broke all the previous records during the end of the year in Finland. The amount of orders increased by 8,2% during the last quarter of 2017 compared to the previous record from Q4/2016. The sales increased by 9,4% during the same period. Overall the e-commerce index increased by 8,7% and ended on an all time high 2787 points. One year ago the increase was 18,2% compared to Q4/2015 so the growth rate was slightly more modest between the last quarters of 2016 and 2017. The growth for the whole of 2017 was 10% compared to 2016.
According to Posti's announcement the record breaking online shopping during the Christmas period increased the number of parcels delivered by Posti throughout Finland to over 37 million packages during 2017. The parcel volume increased by 9% compared to the previous year. Looking at these statistics from Posti we can conclude that the Finnish e-commerce has managed surprisingly well against the pressure from the big foregin web shops. "We have worryingly followed the entry of the Chinese web shops in Finland, but now in the light of the statistics from Posti it seems the Finnish e-commerce has followed the growth rate really well since the statistics from Posti also includes the increased volumes of parcels from foreign web shops", says Vilkas' CEO Markku Korkiakoski.
If we look at the e-commerce index for only December the amount of orders increased by 9,2% compared to December in 2016. But interestingly the sales in euros for December only increased by 3%. What could be the reason for this low increase in sales? "The e-retailers have been forced to respond to the aggressive pricing from foreign competitors by lowering their own prices during campaigns such as Black Friday etc. The end customers are sensitive to prices and usually buy from the cheapest place they can find, so the Finnish retailers have had to start selling with a smaller margin. But in the light of this favorable trend of order volumes it seems this counterattack by Finnish e-commerce has been successful and the growth of order volumes has stayed in the same rate as for foreign operators." Korkiakoski speculates. "This competition has been quite costly for Finnish e-commerce, so it is a good reason for e-retailers to start looking even more carefully at their spendings. Expenses can be reduced for example by automating processes and choosing the most competitive suppliers." Korkiakoski continues.
The upswing in growth continues in 2018 and an interesting year is to be expected. Will this positive attitude from the SMEs also transfer to the consumers in the future and will it encurage a more courageous consumption? This will be followed closely via the e-commerce index during 2018.