We are today seeing dramatic changes in Europe: not only are most European countries going online at an unprecedented rate, but 15 countries of the
European Union are phasing out their own currency and accepting a common currency
(the Euro). The Euro is already legal tender between banks for company payments, and the banknotes and coins of each member country will disappear by mid-2002. The combination of these two factors is widely thought to give strong stimulation to e-commerce, and projections are for $200-220 B in European e-commerce in 2002. For a quick summary of the Euro (), Europe's new currency, click here.
A French marketing research company, Motivaction made a comparative
study of 5000 French people online and their online buying habits.
44% of them have seen an online merchant, and 40% have already bought
something online. Of those who have bought online, 80% said that they
paid by sending their credit card number via the Net.
What do the French buy? 40% of those interviewed had bought software,
27% books, 22% CD-ROM, 22% computer equipment, and 18% audio CDs.
The survey also asked them what they wanted to see developed, and they
replied theatres tickets (50%), travel tickets (46%), banking
services (33%), and publication subscriptions (33%).
123Achat references over 600 French-language commerce sites, giving indications such as currencies,
payment method accepted, security level or delivery time
Allocine (www.allocine.fr -- the French are inveterate film-goers,
with Paris' 350 theatres against New York's 100. Read film reviews, see where
your film is playing in France, and order tickets online)
Aux Vins de France (www.avfr.com): online wine purchase and delivery
in Europe
Promofrance (www.promofrance.com) is a new galery of shops offering
French products (art, jewels, gifts, gastronomy, clothing, entertainment, sports
goods, high-tech, travel and adult products).
JG Paltz (jacquespaltz.fr) has a nice success story: they specialize
in beauty products and opened their Web site one year ago to extend their existing
catalog sales. In one year, their sales have increased by 50%, and the proportion
of export sales increased from 20% to 50%.
Food:
Telemarket is sending out 8000 CD-ROMs containing catalogs with 2400 references of grocery products that are available online. One doesn't even have to have an Internet account to order: the CD-ROM uses Web order processing. The potential market in France is $17 B in France and $95 B in the U.S. within a decade. (The U.S. market is seen to grow from an annual $200 K now to $15-20 M within a decade.) This online portion would represent 15% of the total grocery market. (English version available for their Website.)
Nomade Conso: l'annuaire dédié aux sites Web de vente en ligne, commerce électronique. Vous trouverez une sélection de sites marchands, sites de marques par catégorie de produit et des sites d'information générale pour vous aider dans votre choix.
Hotwin, le premier annuaire européen de sites de commerce électronique
Several French supermarkets (Codec, Casino, Auchan, Carrefour and Hyper U) have opened up Websites and deliver groceries in the proximity of the Web server. They are still in test mode now, but Codec has aspirations to deliver throughout Europe later on. Fast shopping (supermarket in Brussels, Belgium: customers pick up their orders at 7 points in Brussels)
Books/CDs:
FNAC is the largest bookstore in France (both offline and online)
www.axelea.com (mega bookstore -- French books)
Planete Livres has a huge 450,000 cultural titles (325 K books, 120 K CDs, 15 K videos). They sold $300 K online in 1997, mainly in book sales.
Club Européen du Multimédia has a large selection of CD audios to buy online, and one can listen to a CD before buying it.
Restaurants:
YinYang, Asian restaurant Jacques Hesse: all-inclusive menus for $22-$32 (wine as cheap as $8 per bottle): delivery anywhere in the Paris area. Matsuri-Sushi: Japonese restaurant with encrypted payment by credit card. Chez Vous, specializes in everything you might need to order from home (a maid, animal baby-sitter), contains hundreds of Paris restaurants, of every type. Order online, pay upon delivery.
Travel tickets:
DegrifTour, a very popular French tour-operator who sells airplane tickets for last-minute travel. In 1998, they sell one-fifth of their $85 M turnover over their Website, and four-fifths by Minitel.
Germany:
ZD reports that 57% of German surfers have already bought something online.
Horizont reports that e-commerce in Germany will triple in the next two years.
(Source: Horizont)
The German shopping search engine is called Shop.de, complete with 15,000 shops in the database
"Shop24" (www.shopping24.de), Germany's largest shopping mall (1.5 million articles).
Internet-Mall (www.einkaufs-netz.at) is an Austrian shopping mall,
with pizza, inline-skates, office supplies (even portable telephones!), a grocery
store, and the inevitable PC supplies.
Stern Magazine (Germany's equivalent to "Life Magazine") offers a Shopping
Guide (www.stern.de:1814/shop/) of many German online stores, and rates them with stars.
My World - Karstadt (one of Germany's top retailers, with over 800,000 products)
One of the top German bookstores is ABC-Buecherdienst (www.telebuch.com), which offers free delivery.
Travel is more popular in Germany than perhaps any other European country,
and their Websites reflect the drive to get out and see the world. Top sites
include Flug.de (www.flug.de) and Travelcenter (www.travelcenter.de)
for booking airline tickets, Die Bahn (www.bahn.de) to see train timetables European-wide and buy tickets online, and Hotel Reservation Service
(www.hrs.de) to book rooms in 20,000 hotels online.
Ticket Order (online ticket booking for events in Germany)
Primus: CDs, PC software and peripherals, books, travel, entertainment tickets for German events, auction, etc.
EC Commerce GmbH, a multilingual e-commerce site in German, French, English, Spanish and Italian
Virtual Shopping in Italy: a popular shopping mall, offering Italy's finest products and services at very competitive prices. Italian designer products, perfumes, sunglasses, Italian watercolors.
Magellano E-Shop offers over 150 products, representing 50 different manufacturers. Though offering a wide range of products, E-Shop's primary line consists of computer software and hardware. All purchases are made through major credit cards, using the Telepay electronic system
Sweden: Boxman, Europe's answer to Amazon (online bookstore), available in all Scandinavian languages, Finnish and English
There are several food shopping Websites, with delivery in Stockholm: http://www.nk.se and www.kf.se. Another site contains 15 restaurants that deliver dinners in Stockholm: www.aptit.se.
Latin America:
Cadê?/Ibope Research in Brazil published a study of Brazilian ecommerce, finding that 19% of Brazilian Internet users have already shopped on the Net and another 62% showed interest on buying through the Net in the future, thus showing the potencial for e-commerce in Brazil. 72% of the users declared to possess a credit card, 52% of which were bearers of international credit cards.
AOL launched operations in Latin America in December 1998, and they made a most interesting statement in their press release about this launch:
"The middle class is 100 million people and it's growing by 10 million a year. The middle class has a gross national product higher than Germany. There are a lot of people with money. They control 65% of the wealth and have the power of consumption, even in a recession. There is enormous value in the marketplace."
While most Brazilian supermarket managers are worrying
about keeping the produce section stocked, Pao de Acucar is scrambling to revamp the chain's site on the Web, with the homedelivery service at www.grupopaodeacucar.com.br/delivery/. They deliver (next day delivery)
to Sao Paulo, Alphaville, and some places in Brasilia, every day except Sunday (and planning on adding other locations soon).
Brazil is setting the pace for online shopping in South America. Universo Online
(Brazil's biggest ISP, content provider and web developer group -- http://cdf.uol.com.br) includes a
virtual mall featuring 26 stores and companies: flowers, compact disks, books, and
clothing are sold, as well as PCs. They
operate in Brazil as well as other countries in Latin America. Another Brazilian shop is "Shop Brazil (www.uol.com.br).
Japan:
Nomura Research Institute states that
Japan's e-commerce market will expand roughly sixfold to 6.14 trillion
yen (U.S. $4.8 bil) by 2006. The big winners will be
business-to-consumer (growing 5.8 times from 940 billion yen in 2001
to 5.5 trillion yen), consumer-to-consumer (ballooning from 110
billion yen to 640 billion yen), and electronic learning (19 billion
yen in 2001 to 100 billion yen). We can thank the ISP price wars in
large part for this rosy outlook. Time spent online - and therefore
money spent online - is expected to go north as ISP charges continue
south.
Entertainment Plus (ww.eplus.co.jp) sold about U.S. $30 million worth
of tickets over the Internet in 2001, and expects this number to
reach about U.S. $64 million in 2002. Meanwhile, entertainment
magazine publisher Pia and convenience store operator Lawson expect
online ticket sales in 2001 to reach U.S. $40 million and U.S. $24
million, respectively.
U.K.
There are three ways for a virtual shop to collect moneys online in Britain:
Emporia: www.emporia.net (costs $2400 setup costs and $100/month)
NetBanx: www.netbanx.com and www.netinvest.co.uk (phone +44(0)1223/845594). Provides connection to processing network in the UK. Allows Merchants to transact in 116 currencies and settle in 16. Set-up charges are between £75-£500 depending upon the complexity
of the service. Commission on sales depends upon the volume of monthly sales. Less than
£2,000 is 4%, going down to 1% after sales of £10,000 per month.
DataCash: www.datacash.com (officially approved by and permanently
connected permanently to the following Acquiring Banks: NatWest Streamline,
Girobank, American Express, Barclays Merchant Services, Royal Bank of Scotland).
U.K. merchants using DataCash is able to trade in more than 150 currencies and to
have the funds credited to their account in one of 16 currencies (settled).
CyberSource: www.cybersource.com is a US company with partnership relationships that allow it to provide many services
to countries outside the US. CyberSource International Ltd.,
Sunbury International Business Centre, Suite 16; Brooklands Close,
Windmill Road, Sunbury, Middlesex, England, TW16 7DX. Phone +44
(0)1932 787 253, fax +44 (0)1932 787 256. Email:
tonyb@cybersource.com. Some of the services they provide include the ability to transact business in 28 currencies including the
Euro. £295 per month is minimum invoice for their fees, that pays for
about 300 to 400 transactions per month at UK 90p (US$1.45 per
transaction).
British Telecom (BT) proposes a 6-month trial for a new payment service - BT Array (www.btarray.bt.com)
- created for small value purchases (between a few pence and a few pounds). The
service is simple to use: it only requires a once-and-for-all secure SSL (Secure
Socket Layer) registration, complete with credit card details, and an account name
and password. Users are then able to purchase items from any merchant displaying
the BT Array micropayment logo from any WWW access device. BT Array consolidates
the account and charges it to the customers¹ VISA or Mastercard periodically. BT,
which is acting as an intermediary between merchants and customers, takes a
percentage from every purchase.
Germany:
E-cash software was just put into beta-test last October by Deutsche Bank
(Germany's largest bank: www.deutsche-bank.de). Many
German people do not use checks and credit cards to pay for merchandise or
services they purchase; they use bank transfers instead. E-cash had to devise a
secure method for customers to fill out a form on a Web page, which debits their
bank account for the amount of the purchase. This is the only such application
for debit payments in Germany.
A recent survey of people online in Germany and Austria showed that 40% of those
surveyed have already bought something online. Most popular was the
automobile/motorcycle/sport area (16%), followed by the computer area (15%).
(source: Global Online magazine).
France:
There are five secure payment solutions in France:
France Telecom offers a Web-based E-Business solution that was developed by Open Market, called TeleCommerce, in association with banks BNP and Credit Agricole. It goes much further than other solutions, as it does not require users to input their credit card numbers, since they already have given their credit card details the first time they bought on a Telecommerce merchant. $2500 installation cost, plus $150 per month and 3% of transactions. Since France Telecom has vast experience in setting up virtual stores in their 17 years of Minitel experience, this should prove to be a success, as it carries the credibility of one of the national telecom operator. It has been installed first for Le Marche de la France, a virtual shopping mall of French luxury products. TeleCommerce is a complete buying system with a virtual basket, commands management, automatic calculation of VAT tips, customs rights, and statistics. Since France Telecom has already been quite successful with the same sort of virtual shops for its Minitel (which contains today 25,000 virtual shops), this Web development is simply the next logical step. What makes it unusual is that the Web visitor does not have to give his or her credit card number to the merchant: TeleCommerce is responsible for this. The customer can shop in various shops and not have to fill out the payment and delivery form each time -- quite a convenience. Check out the progress at: Le Marche de la France, francecontacts.com/marchedefrance/.
Payline is promoting itself as the top payment solution on the Internet in France for virtual store, costing $85 per month, plus setup charges.
SIPS, which handles back-office work and can even work with multiple languages and currencies.
The first French bank to get into the securized payment business was Credit Mutuel. Their lower price has permitted them to attract more clients than the other solution (around 200 in France): a merchant pays $17 per month, and each transaction is charged $0.17 + 1% of the transaction.
Despite these technical solutions that work in conjunction with French banks, it
is not a straightforward process for a small company to obtain bank authorization
to accept credit card payments online.
Switzerland:
Computer World GmbH has launched a service for Swiss companies to sell online
(www.swisskaufhaus.ch). For a $235 setup fee and $50/month, they will host
a Swiss company's Website and provide the backend services to collect credit card
purchases.
Elsewhere in Europe:
Finland: UUnet is working with Merita Bank to provide e-commerce.
Norway: The Norske Bank provides a platform for e-commerce.
Austria: Bank Austria provides a platform for e-commerce.
Other Payment Methods
Since each national market in Europe is much smaller than the U.S. market, with
consequently more control over local currency use, smart cards were developed
faster in Europe than in the U.S., where regulatory bodies bogged down their
introduction. GEMPLUS (www.gemplus.com) has a small input device for smart cards that plugs into
a PC. It reads smart cards that have been loaded with e-currency, and can deduct
amounts as one spends money onilne. The reader costs $70 or so now, but the price
will drop to $30 late this year. This payment method may well become the most
popular, since it replicates how Europe pays for its public telephone and many
other commodities: through smart cards. Ideal for paying reasonably small
purchases ($5-$250). The equivalent for credit card use is going to take longer
to implement, however.
On-line banking in Europe starting to take off:
Non-traditional banks are taking advantage of the tremendous cost savings
realizable from on-line banking. Leading banks includes:
Country
Name
Subscribers
URL
Germany
Allgemeine Deutsche Direktbank
300K
http://www.direktbank.de
Germany
Bank 24 (Deutsche Bank)
310K
http://www.bank24.de
Germany
Santander Direkt Bank
100K
http://www.santander.de
UK
First Direct Bank
850K
http://www.firstdirect.co.uk
Spain
Banco Direct
110K
France
Cortal
N/A
http://www.banque-cortal.fr
France
Banque Directe
N/A
http://www.banquedirecte.com
All of these users bank either by Internet or by telephone.
A key driving force is the cost of banking on-line versus banking by
telephone or by teller. Bank 24 of Germany estimates the on-line cost
per transaction at $0.01 versus $1.12 by telephone, and double that
amount in person.
With the transition to the Euro, which is scheduled to be fully
implemented in 11 EU countries by July 2002, we expect that on-line banks
will be well positioned to offer European-wide on-line banking services,
by taking advantage of economies of scale and the lack of need of
physical bank branches.
Conclusion
The e-commerce market is growing steadily in France & Germany, both from the technical side (back-end payment systems) and the number of online users purchasing online. As European e-commerce becomes more established, marketing will have to follow in each language, to drive more prospective customers to a given e-commerce site -- precisely the way it does in the traditional business world. There is a very strong need for companies to adapt to global marketing and to use localized approaches, country by country. This means not only translating a Web site, but also giving it the "look and feel" of other Web sites in each country that one is targeting. Furthermore, online stores need to make it easy for people in other countries to purchase from their Web site, if they do not have a credit card. As the rest of the world outside English-speaking countries comes online faster than imagined and e-commerce follows closely behind, it becomes imperative to market to each country in order to attract more visitors to these e-commerce sites.
), Europe's new currency,