State of the Portuguese eCommerce in 2019
“The two largest trends that will impact e-commerce in the next 2 years will be the ongoing deployment of local e-commerce fulfillment around the world and the increasing pressures on costs…”
This line by André Pharand, from Accenture, is the opening act of the eCommerce Report 2019, by CTT – Correios de Portugal. The main findings of one of the most current and complete yearly reports on the state of the market in Portugal was presented by Alberto Pimenta, CTT’s Director of eCommerce, on CTT eCommerce Day, that took place in Lisbon on the 8th of November.
As partners we could not have missed this ever-growing event, that also gathered speakers of different players and important players of the Portuguese ecosystem. Now, we share with you some of the main numbers on CTT’s report and insights to keep an eye on.
The Portuguese eBuyer
If we were to build a persona based on the numbers shown by the report, the Portuguese eBuyer would be an adult woman living in Lisbon or Oporto, and she would purchase something online at least once every three months. She does the majority of her online shopping on eCommerce websites or platforms and is no strange to buying items from international sellers, specially from China, Spain and the UK.
Reasons to buy online
It’s really no surprise that price and promotions are the main reasons why Portuguese consumers buy online. When it comes to the most purchased items, “clothing and shoes” easily stands out as first, with over 63% of respondents stating to have bought products of this category in the last year.
The report also states that eShoppers will buy more online in the upcoming months and years, with 7 out of 10 saying that they intent to increase their future amount of online purchases, not only regarding items, but also on how much they will spend as well as seeking to buy new categories of products.
Mobile first. Really.
With 99% of Portuguese buyers using their smartphones as an important internet access point, it’s no wonder that mobile has an increasing role in the Portuguese eCommerce. We can even say that the famous “mobile first” statement holds true when it comes to Portugal. Smartphones are not only one of the first contact points shoppers have with an item, as 86% of respondents stated that this is their preferred device when it comes to searching and researching products, but it came in first place as the most used device to buy online, having portable computer as a close second.
And even though the brand’s website is still the best ranked touchpoint when it comes to product research, it is quite alarming how much its percentage have dropped. On the other hand, the percentage of Portuguese eBuyers using marketplaces as a source of product information is almost as double as high as it was last year.
Free shipping? Think again.
“Consumers want free shipping”. You must hear that a lot as well, right? Of course they prefer free shipping – and everything else, for that matter – if this possibility is available to them. But the truth is, consumers these days are way more complex than that. CTT’s eCommerce Report shows that, in Portugal, having a good buying experience is the main thing that would make clients return to buy again from an online store. Free shipping is only in fifth place on that rank, behind security, low product prices and simple payment solutions.
But that doesn’t mean that eCommerce owners shouldn’t pay attention to the shipping price, as it came in second as the main struggle Portuguese people face when buying online, behind only to difficulty in finding products with appropriate characteristics.
So, we believe the main takeaway here is to not mistake low price with free. Even though, once again, a high final price is the main reason for cart abandonment according to the report, when we see the whole picture, it’s reasonable to get to the conclusion that this is way more about finding a good balance between product and shipping prices, than jumping straight into offering free shipping, maybe at the cost of precious profit margins. In fact, when it comes to customer satisfaction towards shipping prices, most of respondents are neutral about it.
Deliveries and returns
The report also shows us that over 40% of Portuguese eBuyers are either satisfied or very satisfied with the shipping part of their eCommerce experience.
When it comes to the return process, on the other hand, consumers have shown a high level of dissatisfaction, which is a sign that the need for new and better solutions is a pressing matter for online stores. The main reasons for the dissatisfaction are the lack of information about the returns policy (48%), a point that we have stressed a lot in our articles, having to pay for the returns (47%) and having to move from where there are, in order to send the product back to the store (46%).
As the main pain points go, over half of the respondent chose not knowing the day their product will be delivered as the most important, having not knowing the time of delivery as a very close second.
Home and convenience stores are the top places where Portuguese consumers receive their online orders, but still with a large gap between the first and the second place. Still, 31% of respondents stated that pickup points are very important, which shows a growing desire for more flexibility when it comes to when and where eShoppers want to have their products delivered.
Insights of CTT’s eCommerce Day and our conclusion about the CTT eCommerce Report 2019.
After having access to the whole report, and also being at the CTT eCommerce Day, the event in which the report was presented, watching case studies and insights from speakers of very different brands such as Quem Disse Berenice? (makeup), Staples (office supplies), Nespresso (coffee) we got to the conclusion that many of the ideas that we have, and share, about the market are proving to be on the right track, like the importance of a good and well communicated return policy, the care one should take when approaching the “free shipping” concept and, above all, that shipping is highly contextual.
Not only some numbers on the report show that, but we could also notice this at CTT eCommerce Day 2019. Sandra Conceição, Operations Manager of Nespresso stated, for example, that free shipping is a must to the brand. In the meanwhile, Rossana Gama, head of Quem Disse Berenice? shared that they don’t see such a big change in sales when using that motto in their campaigns. Why? There are no real numbers or studies to back us up here, but we feel pretty comfortable to say that people see their everyday coffee (even if it’s a branded high-quality coffee) very differently than they see beauty products. I might buy 3 to 4 items every time I shop for beauty goods, and then it seems fair to me that it will have a cost to have it on my doorstep within a few days. But coffee is everywhere, and even a good coffee such as Nespresso is a fairly low-price product, which makes me feel a bit unease if I have to pay for shipping the same or more than I have paid on the coffee itself. And let’s not get into the brand aspect that involve both companies, otherwise this conclusion would become an article on its own.
The thing is, it was really interesting to hear from distinct brands how different are their consumers’ expectations not only about buying online, but about how to receive their purchases. Olga Frazão, Europe Head of Retail Marketing from Staples gave an example that we believe was spot on. She said that, as a consumer, she behaves very differently depending on what she’s buying. The Olga that buys office supplies is not the same Olga that buys groceries. And aren’t we all? Our relationship with different products, brands and categories differ a lot and has so many nuances, based on needs, perceptions, feelings, previews experiences, expectations.
And, just as everything else in eCommerce, for shipping as well, one size does not fit all. Or, as we like to say it, shipping is very contextual. And CTT eCommerce Report as well as CTT eCommerce Day 2019 gave us great local examples of that.
If you would like to have a look at the entire report, in Portuguese, you can find It right here.