Luxembourg E-Commerce Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Luxembourg E-Commerce Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

During the time frame of the forecast, it is expected that the Luxembourg E-Commerce Market will register a CAGR of 8.9%.

• Because of where Luxembourg is located, its e-commerce market can take advantage of its closeness to important e-commerce markets in Europe, such as Germany. Because of its location, it is easier for new international merchants to enter the e-commerce market in Luxembourg through cross-border e-commerce.
• The e-commerce market in Luxembourg is expected to grow because banking is easy and there are a lot of people with internet access and smartphones. This makes it easy for people to look for what they want and buy it online. According to the European Economic Forecast, the GDP in Luxembourg will slow down to 1.7% in 2023 before returning to 2.4% in 2024.
• According to a report by Datareportal, the internet penetration reached 98.7%, with 642.8 thousand internet users in Luxembourg at the start of 2023. About 868.8 thousand mobile connections were active in Luxembourg in early 2023. These online shoppers will boost the e-commerce market.
• The European E-commerce Report 2022 confirms 80% of Luxembourgers' shops are online.
• To lessen the effects of rising inflation, the government of Luxembourg decided to temporarily lower VAT rates through 2023.These changes will allow buyers to shop more and increase revenues for e-commerce players.
• During the COVID-19 pandemic, there was a sudden rise in e-commerce in the country because businesses had to use online retail to serve their customers. The scope of e-commerce expanded with new firms and consumer segments.

• As Luxembourg moves towards digitalization, e-commerce will see a broader scope of expansion in the coming years. According to Eurostat, internet access was at 97.64 percent in December 2022. In a study covering 220 countries for the world's fastest internet, Luxembourg was found at 8th place, leaving France behind at 10th and Germany at 33rd.
• Launching new programs like the GovTech Lab, an initiative of the government, or the research project at the Luxembourg Institute of Science and Technology aimed at building a digital twin of the entire nation depends on Luxembourg's desire to be at the forefront of innovation. MeluXine, a business-focused high performance computer (HPC) from Luxembourg, is ranked 36th globally and 10th in Europe in terms of overall power. Its distinctive modular architecture was created to accommodate the different processing needs of businesses.
• The Luxembourg government wants to be one of the leaders in 5G so that its people can get the most out of the latest technology to improve their quality of life and help the economy.The country's new national broadband strategy emphasizes securing private investments for gigabit objectives for 2025 in the country.
• The Luxembourg government assisted in the establishment of the Luxembourg House of Financial Technology (LHoFT), a not-for-profit partnership between the public and private sectors, as part of a larger effort to increase the country's share of the worldwide fintech industry. The LHoFT offers a method for individuals in the financial sector to identify emerging technology, businesses, and solutions.

• With digitalization, the Luxembourg fashion and footwear industry is catching up with demand. The Ministry for Consumer Protection has most recently supported the development of a study by Caritas on textile flows in Luxembourg.The study revealed that 12,26 kg of clothing and textiles are thrown away per person per year in the country, and this is because people are becoming more aware of the quality of the products they buy.
• Fairtrade, an NGO in Luxembourg, organized a fast-fashion escape game to reach new target audiences. It promotes the sustainable development of the textile industry. FairFashion Lab sells clothes made from Fairtrade organic cotton. Fairtrade cotton is more than 70% organic and uses between 50% and 90% less water.
• In July 2022, OCSiAl and CoatYarn will have created smart textile technology using graphene nanotubes. Electroconductive textile gloves that can be utilized by loading machine operators on touch screens are one of the end uses for this technology. Several electrostatically delicate industries, including healthcare, mining, and oil and gas, can significantly benefit from this approach.

The level of skill on Luxembourg's e-commerce market is about average because there are only a few big players.There are more and more local and international brands in the e-commerce market, which will soon make the market more competitive.The fashion industry is driving the e-commerce market. According to a report released by ecommerceDB, the fashion industry accounts for 38.3% of Luxembourg's eCommerce revenue.

In February 2022, the Luxembourgian government will take steps to modernize business models and digitize the financial industry. The Ministry of Finance and SnT inked the Finnovation Hub agreement to define the issues and execute digital techniques for the transformation of financial institutions.

In June 2022, DCC and Implico bought 19 retail forecourts in Luxembourg and upgraded them with new software. Besides Luxembourg, Implico supports more than 1,000 retail forecourts across Central and Northern Europe with efficient and sustainable management.

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