France E-Commerce Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

France E-Commerce Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The French e-commerce market was valued at USD 68.35 billion last year, and it is expected to reach USD 105.03 billion over the next five years, recording a CAGR of 7.49% over the forecast period.

• The European e-commerce business has been expanding rapidly, providing exciting potential for online retailers in various industries. France is a key consumer market in Europe and a significant e-commerce market in terms of internet penetration, percentage of e-commerce consumers, and average expenditure. According to the E-commerce Foundation, in 2020, the e-commerce sector in France accounted for 4.79% of the country's GDP. Further, the e-commerce industry was expected to account for 5.19% of GDP last year.
• According to the Federation of e-commerce and distance selling, online retailers in France making more than USD 10 million per year accounted for about 74.5% of all e-commerce revenue last year. With USD 1 to 10 million yearly revenue, e-merchants accounted for 17.3% of the total e-commerce revenue.
• 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, making them subject 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.
• The pandemic-induced lockdown and mobility restrictions represented a significant point for e-commerce in France, driving demand to new highs, bringing new shoppers and sellers into digital platforms, and offering players long-term growth. Containment efforts introduced people to the convenience of online buying. They motivated seasoned online buyers to buy more, making the Indian e-commerce business one of the significant beneficiaries of the pandemic.

• M-commerce has the potential to become a major shopping channel and alter consumer purchasing behavior. Consumers are increasingly more dependent on digital devices than ever before. Acquisitions in this segment further develop a strong market in the forecast period. For instance, in September this year, a new relationship between Deezer, a French streaming service for music, and the French e-commerce site Cdiscount was launched, which includes purchasing various electrical devices, including TVs and smartphones; Cdiscount will consist of a four-month subscription to Deezer Premium.
• Furthermore, most smartphone users (18%) download digital applications, 11% buy cultural products, such as books, and 10% purchase travel, primarily train tickets, on their phones. In addition, 4% of smartphone buyers purchase books, and 3% purchase CDs and DVDs. Smartphone shoppers claim they shop on their phones at home 74% of the time, while 20% say they shop on public transport.
• E-commerce businesses have realized the value and necessity of mobile commerce (m-commerce) with efficient, user-friendly apps. For instance, a partnership between Carrefour and Google Assistant has been established to allow customers to do their online click-and-collect grocery shopping in-app using voice recognition. Simple Maps was another valuable innovation, an interactive map showing users the top storied locations, including those that sell local and sustainable items within a certain radius.
• During the projected period, the introduction of 5G is expected to be one of the primary factors driving the growth of mobile traffic from B2C websites in France. Despite the publicity in France about the potential of 5G radiation being harmful to human health and the high cost of installing 5G in mobile telecommunications operators' infrastructure, the higher bandwidth and much faster connection speed that 5G represents can be expected to provide a welcome boost to the development of mobile traffic.
• Furthermore, the majority of online retailers in the country have their websites/apps that are compatible with mobile phones, which is also accelerating e-commerce sales through mobile phones—as such, having a mobile phone-compatible application/website is increasingly being considered a crucial factor for success in the e-commerce market.

• Paris is considered an official fashion capital, alongside Milan, New York, London, and many other emerging cities worldwide. Fashion is a deeply rooted aspect of the country's culture and heritage. French people are significantly price-sensitive. They are regularly drawn in by special offers, discounts, and so on, whether online or in physical establishments. This factor creates several opportunities for companies to expand their business in the country.
• Price remains the prime factor while purchasing, whether a luxury or affordable fashion brand, now that online shopping has become a trend. Third-party online retailers continue to grow, increasing the competition in the marketplace.
• In recent times, the fashion industry in the region has set its path toward sustainable and eco-friendly products. The effort to repurpose local resources and reduce waste is part of a broader trend among French firms to provide products made in France. In May this year, with high-end goods, e-commerce behemoth Amazon moved throughout Europe, including France, United Kingdom, Germany, Italy, and Spain. After successfully launching Luxury Stores in United States, the business expanded into Europe.
• Fashion e-commerce in France is evolving to serve the needs of the next generation of shoppers. Since the COVID-19 pandemic, there has been a significant increase in the adoption of e-commerce for fashion and clothing. With this increase in e-commerce, it has been observed that consumer engagement is a substantial opportunity for business growth.
• With more buyers opting to buy from merchants that match their views, personalization and the act of relevance are emerging trends in the region's e-commerce market. In recent times consumer expectations have evolved, and they want an exact solution to be provided for their need. To achieve this, fashion retailers are adopting a data-centric approach to the customers. Companies are acquiring data, such as buying habits, intent analysis, shopping appetite, frequency of purchase, and many more, to leverage AI to develop a personalized customer experience.

The level of rivalry in the industry is high owing to the large number of players operating in the market. The number of local and global brands in the e-commerce market has increased, thus, leading to high competition. The growing popularity and adoption of e-commerce are attracting newer players to the market, leading to the further intensification of competitive rivalry in the French e-commerce market.

• May 2022 - Decathlon has chosen Quadient under its omnichannel strategy to strengthen and offer various delivery options to its customers. The company plans to accelerate its e-commerce by providing services such as 24-hour delivery across France, drive-thru pickup, rental, second-life, and many more.
• September 2022 - The French fashion label Balmain has teamed up with premium minting platform MINTNFT to debut "The Balmain Thread" on the environmentally friendly XRP Ledger at Paris Fashion Week, making it the first major fashion brand to develop an NFT-based membership program.

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