Estonia E-commerce - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2019 - 2029

Estonia E-commerce - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2019 - 2029

The Estonia E-commerce Market size is estimated at USD 0.77 billion in 2024, and is expected to reach USD 1.20 billion by 2029, growing at a CAGR of 9.37% during the forecast period (2024-2029).

E-commerce emerged as a prominent consumer choice to purchase goods during the last decade. The rising internet penetration, growing access to the internet across the populations in developing economies, increasing smartphone penetration, advancements in technology, and rapid urbanization created a massive opportunity for the e-commerce market.

Key Highlights

• The e-commerce sector is taking advantage of opportunities across a variety of landscapes, driven by young demographic profiles, rising internet usage, and generally better economic performance in recent years.
• The consumer electronics, personal care, and fashion and apparel sectors are principally responsible for the market's expansion. There is potential for developing prospects thanks to significant expenditures in the consumer electronics, personal care, and fashion and clothing industries.
• One of the biggest trends in online retail is platform convergence. Customers prefer an all-in-one shopping experience that includes product ratings and prices, buying, and making payments using the platforms' new online payment options. Consequently, online shopping features are available on portal websites, social media, TV home shopping, over-the-top media services (OTT), etc. As a result, their platforms are becoming more popular.
• E-commerce enterprises generally store customers' bank accounts and credit card information. Email addresses, mailing addresses, usernames, and passwords are usually held by e-commerce enterprises, subjecting them to cybersecurity attacks. Cybercriminals profit from this information by duplicating credit cards and utilizing users' personal information for identity theft and fraud. Hackers may potentially hold sensitive data hostage for ransom.
• Furthermore, the supply chain of the e-commerce market was largely disrupted due to the COVID-19 pandemic. Despite creating new opportunities for growth in terms of non-cash payments that could be realized during the forecast period, the COVID-19 pandemic slowed operations in merchant categories, like restaurants, grocery stores, apparel stores, and jewelry stores, which predominantly use online payments. This further created an overall positive impact on the studied market.

Estonia E-commerce Market Trends

Increased Adoption of Digital Solutions

• Automation helps to increase process efficiency, while digital transformation positively contributes to enhanced customer experiences. In other words, businesses embracing the digital revolution will undoubtedly boost the nation's economy.
• Online shopping is becoming widely accepted as a daily practice. It's common to practice researching things online and making decisions. However, organizations are adopting digital transformation to advance their eCommerce operations as trends shift.
• However, online purchasing made it simple to return goods if the client received an incorrect or damaged item. The consumer anticipates receiving the correct order at the proper time the first time due to rising expectations. The clients and subsequent businesses may get dissatisfied with the erroneous order deliveries. As a result, a robust delivery system and supply chain is one of the key reasons companies choose to undergo digital transformation.
• Additionally, customers can use augmented reality technology to see a product where it is supposed to go. For instance, IKEA, a well-known furniture company, offers the option of choosing a piece of furniture and using augmented reality to see how it would fit into your home and style, which enables customers to select and purchase the proper furnishings without having to switch between different platforms and helps them make the right choice the first time.

Fashion is Expected to Hold a Major Share

• In the Estonian e-commerce market, the apparel section leads in sales, followed by electronics and media. E-commerce has seen a noticeable surge in clothing, shoes, and accessories sales.
• The number of online retailers selling fashion goods in the country has increased due to the low digital barriers that merchants in the fashion industry must overcome to enter the market and sell and fulfill orders across various regions.
• Online purchasing can be customized thanks to increased customer personalization and the availability of different goods and accessories. Consequently, the market's competition will expand as e-commerce in the fashion industry is adopted more widely.
• Due to rising disposable incomes and lavish spending, consumer demands in the fashion industry are becoming more complex and diverse. Other elements include the rise of life-enriching consumption, such as leisure and cultural activities, an increase in internet sales, an aging population, and a shift in the core demographic of consumers. The fashion industry's e-commerce sales would dramatically expand due to these trends.
• Many businesses nationwide engage in partnerships and acquisitions to boost their market share. For instance, the Estonian clothing firm Upty purchased Rekki, a Finnish competitor, in April 2022. The business also intends to raise money to support regional expansion.

Estonia E-commerce Industry Overview

The level of rivalry in Estonia's e-commerce market is high due to the presence of many market players. The e-commerce market now has more regional and international brands, which has increased competitiveness.

In April 2023, Alibaba Cloud, the digital technology and intelligence backbone of Alibaba Group, announced Tongyi Qianwen, its most recent substantial language model. The new AI model will be implemented across all of Alibaba's companies in the near future to enhance user experience. Customers and developers of the organization will have access to the model to efficiently design custom AI capabilities.

In April 2022, The Tallinn, Estonia-based business Montonio, which offers e-commerce checkout solutions, raised USD 12 million in a series A fundraising round that Index Ventures co-founded. These monies are intended for the company's European expansion.

Additional Benefits:

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