Czech Republic E-Commerce Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The European e-commerce market has grown strongly over the past few years, providing exciting opportunities for online retailers across multiple industries. The Czech Republic is one of Europe's most important consumer markets, has grown steadily in recent years, and is also an essential market for e-commerce. The Czech Republic e-Commerce market is expected to register a CAGR of 6.1% during the forecast period.

Key Highlights

• Czech consumers are considered sensitive to two aspects: price and quality. Prices are usually quality standards, but Czechs still prefer cheaper solutions. As with ecological and healthy products, local brands in the country are getting more attention. Coming to e-commerce solutions are smart solutions that facilitate cross-border shopping, and the people in the country look for cheaper alternatives in foreign markets.
• The country has established itself as a dynamic and new field of e-commerce. International traders can retain their own by providing citizens with a more established e-commerce infrastructure than Czech traders.
• Cash payments are still an essential feature of this market. To overcome this, international merchants must focus on providing cards, as this method will overtake cash by 2023. The Czech Republic's e-commerce distribution market is developing rapidly. Click and collect is an important feature, but there are also options for quick couriers. By providing secure and simple digital payment options and fast and reliable delivery, foreign merchants can be set apart from their domestic competitors.
• However, ensuring the proper e-commerce infrastructure is an essential issue for the merchants in the country. Domestic payment gateway issues are often seen, and according to a survey in 2020 by J.P. Morgan, 66% of consumers had problems storing payment data in their online shop or payment gateway due to various issues such as low internet connectivity or more.
• The Czech Republic responded swiftly to the COVID-19 pandemic in the first half of 2020. Nonetheless, online sales of merchandise surged in April 2020 and remained flat by end of the first half. The significant decline in the travel industry had a major impact on sales in 2020 due to the COVID-19 restrictions.

Key Market TrendsSurge in demand for ecommerce due to COVID-19

• The outbreak of COVID-19 and the nationwide blockade have had a significant impact on retail industries worldwide, especially in-store models. However, e-commerce is one of the few sectors in which consumer interaction increases in many segments. With the closure of non-essential stores and the enactment of national closure orders, many companies were forced to adapt and respond to changing consumer priorities quickly. Some market in the Czech Republic's e-commerce sector has grown significantly.
• The fastest growing market of Czech e-commerce is groceries, followed by hobbies, cosmetics and toys. The COVID-19 crisis has accelerated the expansion of e-commerce to new companies, customers and product types. This gave customers access to a variety of products from the comfort and safety of their homes, allowing businesses to continue their business despite social distance and other blockade restrictions.
• According to a survey conducted by Heureka Group in July 2021, The COVID-19 pandemic has changed the behavior of Czech customers online. It has changed from a timely switch to contactless payments to a trend of trust when making purchases in larger, more reliable online shops. After the closure of retail stores, new online shops have emerged as new sales channels, often as a complement to physical stores.
• According to a survey by Barion, 48% of Czechs shop online more than before the pandemic, while 66% prefer to pay by card. The survey also suggests that about 13% of Czechs prefer to avoid traditional physical stores and shop online as much as possible.
• Moreover, due to the COVID-19 pandemic, the operations were hindered in some sectors such as travel and tourism, but in the last few months since 2020, the country has seen rapid development in other areas such as finance and logistics.

Food and Personal Care market to drive the market growth

• Czech society embraces and uses the potential of information technology. There is a great deal of constant pressure on each individual to embrace new forms of communication. Digitization black holes are a reality today. A new era is approaching when most of the country's basic needs and activities, including work, are handled by these modern services, and perhaps other options will eventually disappear. New technology will be a recent call for society as it is efficient and valuable to start using information technology in grocery retail, and it is an opportunity for various merchants in the region with the right strategy.
• Online grocery sales have increased in recent years. In the Czech Republic, sales in this segment have increased by 106% annually over the last three years, as stated by Europaproperty. Growth was also high in other parts of Europe, averaging 37.3%. The tendency to buy groceries online started before the pandemic, but the pandemic accelerated it.
• The ability to deliver groceries home has become appealing to those previously reluctant. This segment is expected to continue to grow, as many appreciate the benefits of this type of shopping. The share of total food sales in the Czech Republic is expected to rise significantly in the coming years.
• Czech clients are widely recognized for being traditional, conservative, and fee sensitive. However, those tendencies no longer usually follow about purchasing cosmetics and more. With the more youthful generation that is style aware and travels extensively out of doors, the country has a more consciousness of world trends. Branding plays a critical position in shopping decisions with huge global players already present within the market. With the presence of significant players, the e-Commerce market for personal care market is also leveraged in the country.

Competitive Landscape

The Czech Republic e-Commerce market is moderately competitive with the presence of a few major players in the region. The competition is also increasing with the presence of newcomers in the e-Commerce industry and is trying to expand the market to gain market share.

• March 2022 - Alza.cz has invested more than CZK 1 billion in the development of a state-of-the-art logistics center in Chrastany near Prague. This is the largest one-time investment in the history of the company. In addition to expanding the existing area by an additional 15,000 m2, the e-Shop is implementing new AutoStore technology here. This greatly improves the efficiency of the warehouse and reduces the time it takes to ship the goods to the customer.
• April 2022 - Aukro, one of the largest online marketplace, has launched a new Aukro reality service. The purpose of this service is to provide secure real estate sales with a new and modernized auction system that is fair, transparent, and can bring interesting benefits.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Please note: This publisher does offer titles that are created upon receipt of order. If you are purchasing a PDF Email Delivery option above, the report will take approximately 2 business days to prepare and deliver.