Over the past 20 years, Amazon has developed from a small seller working from a garage in Seattle to a global company with millions of active customer accounts worldwide. Since its introduction to the market in 1994, Amazon has become an e-commerce giant. Today, it’s one of the first places shoppers look for everything from cleaners to the latest tech gadgets. This success has been built over the years and is partly due to Amazon’s strategic approach to development. Any e-commerce business, no matter where it starts, can learn from Amazon to grow its business and attract and retain more customers. So how does Amazon work in Germany? Let’s see!
An innovative approach
Amazon.de is the most visited e-shop in Germany that estimated monthly traffic of 434.5 million visits in May 2021. The key to Amazon’s success is its innovative technologies and customer-focused approach – not only in Germany. The company popularized free shipping and returns, reducing consumer concerns about shopping online. Additionally, the store offers next-day delivery for a reasonable price, making it one of the first online stores that used such an option. This tactic solved the problem of online shopping where you have to wait for the product to arrive, which can irritate the consumer for some offers. As a result of offering reasonably priced shipping, Amazon could attract customers that would have otherwise bought from a physical retailer. In addition, as part of its commitment to excellent customer service, Amazon has developed several tools that users can use to track packages and quickly return or replace orders.
The brand’s commitment to becoming the world’s most customer-focused company has paid off so far. This has resulted in the ease and convenience of online shopping and impacts the growing number of new sellers. For example, the monthly number of new third-party sellers on Amazon in Germany from 2017 to 2019 is following:
Top 10 online stores in Germany
The ecommerce industry in Germany grew exponentially during the Corona pandemic last year, as it has in most European countries. In 2020, the top 1.000 online shops and marketplaces generated 70 billion euros in sales, increasing over 30%. What with Amazon? Its revenue is at least three times higher than Otto, the second-largest player in the country. Zalando is in third place with a turnover of 1.9 billion euros.
German consumers rarely choose to pay with credit cards. Instead, they prefer the invoice payment option as well as debit cards, bank transfers, Giropay and PayPal. Therefore, what forms you offer to your customers will undoubtedly influence consumers’ purchasing decisions and thus your sales success in this market. Amazon is aware of this and meets customer expectations as it provides plenty of payment methods.
The best employer in Germany
Amazon is one of the most prominent players in the market. Its immense popularity in Germany is reflected by the fact that it has a user share of 83%, far ahead of any competition. As such, its customers come from all walks of life. By 2022, the company planned to build eight new logistics buildings in Germany. This will result in an additional 3.000 jobs at Amazon Germany. The expansion is needed to meet customer demand and expand the product range.
In the period 2010 to 2020, Amazon invested almost 40 billion euros in Germany, including over 10 billion euros in 2020 alone. By the end of 2021, all corporate divisions in Germany had over 28,000 permanent employees. Amazon currently has around 60 locations in Germany. In addition, this logistics network employs nearly 19,000 people permanently.
Amazon’s data protection
Personal data protection on the internet is a hot topic in Germany and many Germans are distrustful of online services. German internet users are concerned that companies collect too much of their personal information. At the same time, they are online, and almost one in two try to share as little information as possible. However, online services do not all arouse the same level of distrust among German internet users. In terms of data protection, Amazon receives the highest level of trust compared to other online brands.
This makes Amazon one of the most trusted online brands in Germany. While only 17% of German internet users say they generally trust online stores when it comes to protecting their personal data, the number one most trusted online brand might surprise you: With 42% of German internet users trustfully sharing their data with Amazon, the eCommerce giant, is the most trusted online brand in the eyes of German internet users. As a result, Amazon also has significantly higher levels of trust than other tech giants like Google, Apple, or Facebook. Only one in five Internet users trusts Facebook to handle their data responsibly in Germany. Approximately 32% of respondents say they trust no company mentioned above. Thus, there is still much to be done by internet companies in terms of data protection and transparency in the eyes of the German online population.
E-commerce retailer Amazon was planning to reduce the use of plastic packaging in Germany by the end of 2021. In addition to switching to paper bags and corrugated cardboard boxes for more oversized items, the company switched from single-use plastic packaging to paper bags. In addition, Amazon France announced it would replace plastic pouches used for small items with paper bags or envelopes by the end of the year. Furthermore, to make grocery delivery more sustainable, Amazon has also introduced kerbside-recyclable insulation packaging made from recycled paper.
Bubble wrap will, however, continue to be used for fragile items such as glassware. Moreover, company officials announced that third-party products in single-use plastic bags, which can be relabelled for delivery, and items to be delivered to wet outdoor locations would remain packaged as received.
Over to you
The German economy is one of the strongest and most stable in the European Union. However, it is also one of the most demanding. When selling in this country, online retailers must deal with prominent delivery, payments, a variety of offers, but above all, customers who tend to return orders. Nevertheless, Amazon does very well here. Availability, speed, punctuality – these are what set Amazon apart from the competition.