Latvia is one of the Baltic countries. It borders Estonia, Russia, Lithuania, and Belarus. It has access to the Baltic Sea from the West. Latvia is one of the smallest countries in Europe – its area is only 64 573 sq km.
Since 1991 Latvia is a UNO member. It also belongs to the EU and NATO. The GDP of this country in 2019 was US$34.12 billion. Its economy is doing quite well – the biggest part of Latvian GDP is an industry. What about online actions? How ecommerce and consumers attitude is towards it? Let’s cover this topic.
Let’s start with the Latvian ecommerce overview.
Ecommerce in Latvia – overview
Ecommerce revenue in this country is predicted to hit US$304m by the end of 2020. In five, its revenue may grow to US$421m by 2025, thanks to the annual growth rate at the level of 6.8%.
The biggest sector in Latvian ecommerce is Electronic and media. Then comes Fashion. The third-place belongs to Toys and hobby. The last two are Furniture and appliances and Food and personal care.
Favorites ecommerce sites among Latvians are Ss.lv – Latvian marketplace and 1a.lv, Latvian marketplace, too. The third-place belongs to Amazon.de. Then come Ebay.co.uk and Amazon.co.uk. The two giant retailers are not present in the Latvian market yet.
Latvian consumers behavior
For Latvian consumers, price is the most important factor influencing purchasing decisions. The more affluent part of consumers who can afford more choice indicates the brand as a decisive factor. They are ready to pay more for the products of their favorite brand. Recreation, hotels, and restaurants are among the expenses that have significantly increased in recent years. The interest in ecommerce has also increased, and the pace of this growth is one of the highest in this part of Europe.
Latvians do buy online and do it also cross-border. The most popular country to buy from is Russia, with US$4.84 billion in imports. The second place belongs to Lithuania – US$2.47 billion. Then come Germany with US$1.85 billion, Poland with US$1.37 billion, and Estonia with a little lower score of US$1.21billion.
Payment methods in Latvia
The most popular payment method in Latvia is by credit card. The second place here belongs to mobiles and third-one with 14% of market share. One of the local payment providers is Maxime. It provides cash, credit, and debit cards payment. It operates in Latvia and Lithuania. It is also part of SEPA – Single Euro Payments Area, which is a European agreement that makes cross-border payments in the European Union seamless. In Latvia, WebMoney is also available. It is a global ewallet that allows payment on local currencies, not only EUR or USD like most such solutions. Another global solution that is available in Latvia is MINT. A prepaid card payment which allows quick and secure global payments online. But in Latvia, prepaid cards are not very popular so as MINT.
Latvian social media
In Latvia, 86% of the population is online. Only 53% of them are active social media users. But if we compare 2019 and 2020, the number of social media users is growing – about a 6% increase. About 95% of social media users use it from mobile.
The greatest ads’ reach in Latvia has Facebook – 870 thousand can be reached by ads on this platform. The lowest score in this matter has Twitter – you can get to about 143.5 thousand users via advertising on this platform.
Logistics in Latvia
The Lithuanian road network is approximately 13,181,616 km. The vast majority of them are large national roads. There are 15 of them, and they connect the main communicational and trade points on the Latvian map, which means, in most cases, larger cities. They combine cities like Riga, Daugavpils, Ventspils, and Liepāja. As many as nine state roads lead to borders. One road leads to Russia’s borders, to Lithuania – four routes, to Estonia – three lines, and one road leads to the border with Belarus.
When it comes to railroads, it is the mainline of commercial transport. Thanks to railways, about 50 million tons of cargo are transported annually. Thanks to this type of transport, Latvia is well-connected with its neighbors and also Asia and countries like Japan or China. Important places for the Latvian railways are Riga, Ventspils, Liepāja, and Daugavpils.
Latvia has three main ports – in Riga, Liepāja, and Ventspils. They operate all 12 months in a year. There are also smaller ports at Salacgriva, Lielupe, Engure, Mērsrags, Roja, Kolka, and Pāvilosta that don’t operate all year round. All the ports mentioned above are placed in Special Economic Zones, which strongly supports a Latvian economy.
There are also two major airports, Riga International Airport and Liepaja International Airport. But there are presents, mainly passenger airlines.
To recap quickly
Latvia is a new consumer market for ecommerce. So there is great potential, especially for ecommerce providers, who know the East European market’s character. Thanks to this article, we have hoped that you have gathered some valuable information about the Latvian ecommerce market.
If you are interested in the East Europe market, here you can read about Lithuanian ecommerce.