Ecommerce in Spain: expand into the Spanish online market
Compared to other European countries, the Spanish online market has developed relatively slowly. Since it can’t be classified as mature yet, it’s an attractive destination for international online sellers.
Spain has gone through hard times recovering from recession and has also been affected by the coronavirus pandemic. However, Spain is one of the leading ecommerce markets in Southern Europe. It’s also considered the 4th largest B2C ecommerce market in Europe behind Germany, the UK and France.
Read more about the Spanish marketplace and how to win the Spanish online buyer.
Spain: ecommerce market with online sales potential
Spain boasts a thriving and rapidly growing ecommerce sector. In 2018 it was worth €27.96 billion: 17% up from 2017.
Revenue is expected to show an annual growth rate (CAGR 2020-2024) of 7.6%, resulting in a projected market volume of US$25,824m by 2024.
According to the study carried out by Comision Nacional de los Mercados y la Competencia, in the case of Spain, more products are bought abroad than sold. Hence, this up-and-coming marketplace has lots of cross-border trade potential.
Spanish is the third most commonly used language online, after English and Mandarin.
The Spanish online buyer
Spaniards speak loudly, are affectionate with newly-met people and love drinking and eating. They’re also a group of online buyers that growth-minded international sellers should consider. The average revenue per user is expected to amount to US$680.83.
There are around 47 million people living in Spain, around 70% of which are Internet users according to World Bank.
Due to the challenging economic situation, Spanish buyers have been hungry for cheaper prices, which is likely to affect their product searches online.
It’s also worth mentioning that the Spanish love freebies: it doesn’t matter what it is, as long as it’s free, they will love it.
According to Landmark Global, the typical online buyer in Spain:
- Is 25-49 years old (35-49 year olds in particular)
- Lives in urban areas and works full-time
- Is university educated
- Comes from a medium to high professional social class.
Popular payment methods in Spain are Visa, MasterCard and PayPal.
Overcome trust issues & win the Spanish online shopper
Generally, Spaniards like shopping online, but unfortunately some of them fail to complete their online purchases. Not only because the buyer finds the price too high, but also due to confidence and trust issues.
Some shoppers may feel uncomfortable not being able to physically see the product. Others may be put off by the necessity to enter personal details whilst making online payments.
What are the main reasons for incomplete online transactions?
- The free shipping option is not available
- Products are too expensive
- Shoppers don’t feel confident when it comes to returns
- Shoppers don’t feel safe when it comes to payments and may not want to give out personal details.
- Shoppers can’t see what they’re about to purchase and may not have enough product information, which may result in a lack of trust.
To increase your chances of making a sale, you need to overcome any potential trust issues. For instance, by providing shoppers with a great deal of product information, photos and customer reviews. You should also work with an experienced and trusted payment service provider.
To give Spanish online buyers more confidence, online sellers should:
- Provide consumer opinions proving that other shoppers haven’t had any issues with their purchases
- Offer secure payments with tools like Paypal
- Make sure shoppers know about the possibility of returns so that they don’t feel intimidated by an irreversible purchase
- Provide shoppers with easy ways to contact the merchant
- Provide shoppers with enough information and detailed product descriptions.
Spanish online shopper in a nutshell:
- Has an exceptional fondness for finding low prices and being offered freebies
- Values simple returns
- Wants to feel confident when purchasing a product that they can’t see and when they have to enter personal details online
- Likes to see their purchases delivered within 3–5 days.
Top 10 ecommerce sites in Spain 2020
Top ecommerce sites in Spain include marketplaces, supermarkets, electronics stores, classifieds, sporting, and fashion stores. This mixed blend indicates the diversity of demands from the Spanish population.
The top 10 ecommerce sites in Spain based on the data from SimilarWeb include:
- Amazon Spain
- El Corte Ingles
- Ali Express
- eBay Spain
- Carrefour Spain
- Media Markt Spain
- PC Componentes
- Decathlon Spain
- Leroy Merlin.
Popular ecommerce categories in Spain
In terms of product preferences, Spanish consumers resemble their other European counterparts. They often shop online for clothes & footwear, home electronics and books. In addition, Spaniards like to buy car accessories and food online. Most purchase values range between €100 and €500.
The market’s largest segment is Fashion with a projected market volume of US$5,245m in 2020.
What is noteworthy is the tendency of Spanish shoppers to turn to their friends and family for recommendations before making a purchase. In other words, the retailer’s reputation and ratings are important.
Logistics in Spain
When it comes to logistics, Spain is a bit behind the leaders from Western Europe. Correos, the Spanish postal operator, is trying to embrace the ecommerce demands with carriers such as Seur and MRW. Seur focuses on home delivery and MRW operates both home delivery and pick-up locations.
Spain & cross-border trade
Spain is one of the European markets with a big potential for both domestic and cross-border ecommerce. According to Paypers, the number of transactions made in Spain on foreign sites account for 56.5% of ecommerce transactions. When it comes to overseas purchasing, home furnishings and clothing & footwear are a popular choice.
Spanish shoppers mostly buy from the UK (14.2%), China (12.5%), the US (10.3%) and Germany (9.9%); in percentage of total Spanish cross-border purchases.
Spanish etailers mostly sell to the UK (3.9%), Italy (3.5%) and France (3.9%); in percentage of cross-border sales from the respective countries.
Ecommerce in Spain is full of potential, but it may still be a challenging area with room for improvement. For instance, online payment methods still leave a lot to be desired.
Most issues have to do with security and practicality. There are many frustrated attempts to make payments daily: 35% of consumers trying to make a purchase aren’t able to do so. The main reasons for these failed attempts include:
- Too rigid antifraud filters
- Restrictions on credit card purchases
- A lack of choice of payment methods.
Want to sell online in Spain? Think about the language first!
The stereotype has it that Spaniards speak English in a way that leaves a lot to be desired. According to a study conducted by the OCU, 9 out of 10 Spaniards feel embarrassed whilst communicating in English.
Thinking of selling in Spain, think about the language as a key driver. The official language is Spanish, spoken by 72% of the population. Moreover, around 414 million people worldwide speak Spanish as a native language. This number ranks Spanish second to Mandarin when it comes to the number of native speakers.
An important takeaway here is:
Much of ecommerce in Spain is driven by language, rather than by geography.
This places many of Spain’s international customers in South America.
So if you are thinking of selling online in Spain, communicate in Spanish! Adapt your offers to the local buyer. At the same time, there is a chance that millions of other Spanish native speakers outside of Europe will find your offers too.
Even though Spain has been affected by a big financial crisis, high unemployment rates and coronavirus, the ecommerce sector is actually an area with sales potential.
Spain is one of the hottest countries on the European continent: not only in terms of temperatures but also international ecommerce potential.
Since in Spain more products are bought abroad than sold, online sellers should definitely consider international expansion into the Spanish marketplace.
Learn how to sell online after Covid-19 & Brexit!