In the age of e-commerce, businesses are increasingly looking to expand beyond the conventional bounds of their market. Nowe Kolory company steps in as a response to these needs, giving German companies access to the dynamically developing markets of southern Europe. Entrepreneurs who choose this option gain a unique opportunity to expand their business into markets such as Romania, Hungary, Bulgaria, Greece and Cyprus.
Advantages of cross-border commerce:
Cross-border commerce not only provides an opportunity to increase sales volume and secure revenue growth, but is also an important way to diversify sales channels. The profitability of sales in foreign markets is determined by factors such as the size of competition, transport costs, and differences in the VAT charged. The opportunity to gain international experience is also quite a substantial factor, which is an invaluable asset nowadays. For German companies that have already achieved success at the competitive domestic market, cross-border commerce opens up a new chapter in their journey, offering the opportunity to introduce their products to new cultures and consumer environments.
The potential of southern European markets:
Countries such as Hungary, Romania, Bulgaria, Greece and Cyprus offer huge potential for German entrepreneurs. Diverse consumer needs and less competition compared to the German market create favourable conditions for business growth and higher margins. It is also worth noting that these markets still remain overlooked by international corporations, which creates an ideal niche for German companies.
Customers from southern European countries tend to buy from foreign online shops, which is a trend particularly evident among Hungarians (77%), Bulgarians (71%), and Romanians (67%). These figures are significant compared to the EU average of 57%, which indicates a high level of activity in international shopping in these regions. The dominant factor in this trend is that consumers are looking for better prices and a wider range of products than what is available at local markets.
Analysis of the e-commerce market in Hungary:
Hungary, ranked 57th among emerging e-commerce markets, has a projected annual growth rate (CAGR) of 12% between 2023 and 2027. Although Hungarians still often prefer payment on delivery, cashless payments have been increasing in popularity. For retailers aspiring to grow in the Hungarian market, it is crucial that such payment methods are made available. The most popular online shopping categories in Hungary include books, coupons, IT and electronics products, insurance services, e-tickets and holiday bookings.
By 2027, the number of e-commerce users in Hungary is expected to grow to 5.8 million. It is worth noting that almost 40% of e-commerce revenue is generated in the last two months of the year, which is linked to the festive season. Footwear is one of the leading products on the Hungarian market, with a 53% share.
In the category of delivery methods, courier dominates with 80%, followed by pick-up points (38%), traditional postal delivery (36%) and the so-called szadi (27%). Szadi, which denotes parcel lockers, cover as many as 50% of Hungarian orders at eMAG.
The fashion market in Hungary is developing rapidly, driven by an increase in the number of users and a growing number of brick-and-mortar shops switching to e-commerce. Trends in this market include personalisation, increased focus on social media platforms, and the integration of artificial
intelligence. For retailers interested in expanding into Hungary, it may be strategic to invest in local e-commerce platforms to capitalise on these trends.
The most visited Hungarian e-commerce sites in 2023 are eMAG.hu, Arukereso.hu, jofogas.hu and Vatera.hu.
Overview of the e-commerce market in Romania
Romania ranks 47th among emerging e-commerce markets, with a projected CAGR growth rate of 12.7% between 2023 and 2027. Romanians have recently increased their spending on luxury products by 50%, particularly in categories such as high-end clothing, footwear, watches and perfume, with an average order value of 2,200 lei.
The beauty and healthcare sector is very popular in Romania, accounting for 64% of the market.
The most popular Romanian website and also e-commerce brand is eMAG.ro Marketplace, which is reminiscent of Amazon in its design.
Reports from eMAG indicate that online shops in Romania offer around 15 million unique products, compared to over 100 million products available in Germany, which shows the great potential of the Romanian market. International retailers are focusing more and more on this market, especially in the fashion sector. Also, options for deferred or instalment payments are appealing to Romanian consumers, which opens up opportunities for retailers interested in the “Buy Now, Pay Later” offer in this market.
Sales data from eMAG also point to a high share of parcel lockers among the most popular forms of delivery, as is the case in Hungary and Romania. In 2023, they already exceeded 60%.
A study of the e-commerce market in Bulgaria
The results of the Bulgarian e-commerce market survey offer interesting insights into online consumer behaviour and preferences and also reveal current trends in the sector. Here are the key findings:
The e-commerce market in Bulgaria is growing, with 44% of Bulgarians using online shops in 2021. This proves that e-commerce is gaining ground in the country.
As for the frequency of online shopping, most customers who had shopped in the last three months before the survey did so moderately. Fifty-six percent of them made online purchases only once or twice, 35% three to five times and 9% at least six times.
Payment by cash on delivery (COD or cash on delivery) is hugely popular in Bulgarian e-commerce, preferred by 60-70% of customers. Credit cards account for about 20% of the payment methods used, while ePay/EasyPay make up 5-10%.
It is also worth noting that as many as 96% of Bulgarian online shoppers chose products from domestic sellers, highlighting the high trust that consumers have in local suppliers. However, 30% of customers opted to buy from sellers from other EU countries and 36% from sellers from abroad.
The behaviour of older consumers is not without significance, as more than 40% of older Bulgarians shopped online at least once a month in 2021. This means that e-commerce attracts different age groups, although it may be less popular among older consumers compared to Western Europe.
The top ten online shops in Bulgaria accounted for just over 20% of total national revenues in the same period. This implies that the capacity for innovation and investment is a prerequisite for success in the Bulgarian e-commerce market.
The most visited e-commerce sites in Bulgaria in 2023 are eMAG.bg, amazon.com and kauﬂand.bg.
It is also worth noting that footwear is a ﬂagship product in Bulgaria and accounts for 61% of the share of online purchases. This is an important aspect for sellers and entrepreneurs interested in the Bulgarian market.
A look at the e-commerce market in Greece and Cyprus
The Greek market is distinguished by considerable dynamics compared to other countries. In 2020, Greece recorded a remarkable growth in online sales of up to 77% year-on-year, the highest in Europe. The pandemic stimulated the development of the e-commerce sector in the country, where as many as one in five Greeks made their first online purchases. Also, Greeks are active customers buying products via social media and marketplaces.
The e-commerce market in Greece has for several years been heavily dominated by the skroutz.gr marketplace. It is now the leading access point to Greeks and Cypriots.
At present, there are only Greek sellers operating there, with virtually no EU or Chinese sellers.
According to data from the 2022 European E-commerce Report, up to 71% of Greeks made purchases as online shoppers in 2021. Of those who had shopped online in the last three months prior to the survey, 27% had done so occasionally, one or two times, 35% had shopped between three and five times and 38% had chosen to shop online six or more times.
In 2021, the majority of e-commerce customers in Greece chose products from domestic sellers (91%). However, one in four Greeks placed orders with sellers from other EU countries (25%), and 35% bought from non-EU sellers.
In terms of purchasing preferences, the price of a product is, of course, an important factor for 40% of consumers. The choice of a particular e-retailer is based on a combination of factors, including economic reasons such as price and free delivery (51%), product features, including the brand and its specific features (31%), as well as previous experience with a particular online shop (18%).
What is also interesting is that as many as 58% of online shoppers rated the quality of delivery very high, giving it a score of 9 or 10 on a ten-point scale. Only 7% of customers were dissatisfied with the quality of the delivery, giving it ratings below 5 points.
Capabilities of the eMAG and Skroutz platforms
The eMAG and Skroutz platforms are two sales platforms operating in the e-commerce market. Their impact is strongest especially in the region of southern Europe. Here are some of the significant benefits that these platforms provide:
Advantages available to entrepreneurs cooperating with the eMAG platform:
- Access to a large market: eMAG is one of the biggest e-commerce platforms in Romania, Hungary and Bulgaria. Using eMAG, overseas retailers can reach a large customer base in these countries, thus increasing their sales potential.
- Promotion and advertising: eMAG provides free marketing tools to help you promote your products. This allows foreign retailers to increase their visibility and attract customers.
- Consumer trust: By using a well-known and established e-commerce platform, overseas retailers can gain more trust from customers, which can help build your brand.
- Transaction security: eMAG ensures the security of online transactions and payments, which is important for both customers and sellers.
- Delivery of orders to parcel lockers thanks to the offer of Nowe Kolory. Benefits available to entrepreneurs working with the Skroutz platform:
Price comparison: Skroutz is a popular price comparison platform in Greece and Cyprus. Foreign retailers can attract customers who are actively looking for the best deals online.
- Product diversity: Skroutz offers a number of product categories, enabling foreign retailers to sell a variety of products.
- Reviews and ratings: The platform allows customers to post product reviews and ratings. Positive reviews can help foreign retailers build their reputation and attract customers.
- Local search: Foreign retailers can use the local search options on Skroutz to attract customers from specific regions in Greece or Cyprus.
- Integration with e-commerce: If a foreign retailer operates its own online shop, it can integrate it with the Skroutz platform, allowing it to increase the visibility of its products and reach more customers.
In conclusion, both eMAG and Skroutz offer multiple advantages to foreign e-commerce sellers.
Hungary (eMAG.hu): A market where innovative products are in high demand and which is ideal for retailers seeking new opportunities.
Romania (eMAG.ro): A booming market with high demand for electronics and fashionable goods. Bulgaria (eMAG.bg): A market with growing purchasing power and interest in quality products.
Greece and Cyprus (Skroutz.gr): Markets with a strong focus on unique, customised products, perfect for creative Polish brands.
The choice of platform depends on the specific goals and sales strategy of a given entrepreneur.
Risks and challenges for retailers at eMAG and Skroutz
Entering the eMAG and Skroutz platforms has its advantages, but it also poses certain difficulties and potential dangers for retailers. Here are some of the key challenges:
Difficulties and dangers associated with eMAG:
Fees and commissions: eMAG charges retailers fees and commissions for using the platform. These costs may affect the profitability of sales.
Changing trends: E-commerce is an industry subject to change. You need to be ready to adapt to changing trends and customer preferences.
Logistics: organising deliveries can be difficult, especially in the cities and regions of Greece, where delivering goods may pose a challenge due to the difficult terrain and location on the islands.
Order management: Complex orders and a large number of transactions may require an effective order and inventory management system.
Difficulties and dangers associated with Skroutz:
Price competition: launching products on Skroutz often involves competing in terms of prices. Customers often compare offers from different retailers and choose the ones that offer the best prices.
Managing reviews and ratings: Customer reviews on Skroutz are important and negative reviews can affect a company’s reputation and result in the loss of customers.
The need for strict compliance with regulations: Retailers must comply with online trade regulations such as consumer rights, protection of personal data, etc.
Price flexibility: customers at Skroutz often expect flexible pricing and special offers. Companies must be prepared to adapt to these expectations.
Inventory management: Efficient inventory management is key to preventing delivery issues and customer dissatisfaction.
In summary, while being on the eMAG and Skroutz platforms has many benefits, it also comes with certain challenges and dangers. Retailers must be prepared for facing competition, changing trends, price management, logistics and maintaining a good reputation. However, with the right business partner, you can succeed on these platforms.
Solution: Nowe Kolory is an expert in expanding into southern European markets.
Nowe Kolory offers comprehensive support that makes it easy to launch and sell on the key marketplaces. Our company’s product range includes:
- Registration on Platforms: Help with quick and free registration on eMAG and Skroutz platforms.
- Adding Products: Assistance with adding products to both platforms, allowing retailers to focus on the sales offer.
- Promotion on eMAG: Free tips and strategies on how to effectively promote your offer on eMAG allow you to increase your visibility.
- Logistics and Delivery: Logistics solutions ensure smooth delivery of orders to Hungary, Romania, Bulgaria and Greece and Cyprus.
- Clear Settlement System: A simple settlement system, including handling collections, settling returns and other payments.
- Parcel Locker Service: Around 60% of orders involve parcel locker deliveries, and Nowe Kolory helps in their handling.
- Fulﬁlment in Romania: Nowe Kolory offers a fulﬁlment service in Romania using its own warehouse, which significantly increases sales.
- Account Support: A team of specialists handles accounts on platforms, answering customers’ questions and supporting in solving problems.
- Indicators and Monitoring: We help monitor account performance indicators, including issues with returns as well as other challenges.
- Assistance with handling returns: All returns and settlements are handled by us, so you can focus on what you do best – managing your business.
Nowe Kolory is a partner that supports retailers at every stage of their expansion into the e-commerce markets of southern Europe. With our assistance, entering the market and achieving success on the eMAG and Skroutz platforms is easy.
Cross-border – an important trend in 2024.
Cross-border commerce will continue to be one of the key trends in e-commerce in 2024. Businesses that actively sell abroad expand at a substantially quicker rate than those that focus solely on the domestic market. This demonstrates that exporting to other countries is an important direction for the growth of Polish e-commerce, with our neighbours and larger southern European countries such as Romania, Hungary, Bulgaria, Greece and Cyprus proving to be particularly promising markets.
Nowe Kolory is your gateway to southern Europe – a region full of possibilities and ready for German quality. This is an opportunity for a new chapter in your company’s history that can not only generate profits but also help you build an international brand. We encourage you to embark on this exciting journey.