Over the past few years, the stable labour market situation and the sustained low interest rates have led to a consumer boom in Germany. However, a significant amount of purchases consumers feel compelled to make are not being made in shops, but are instead conducted online. Now, almost one in every ten euros spent is attributable to online retail. Customers are buying over the internet more and more and this trend is set to continue.
This is contributing to the positive mood among online retailers: the ifo business climate for online and mail order trade has remained almost continuously above the level of retail as a whole, and has sometimes even been much higher, most recently this February, when the business climate for internet retailers improved considerably compared with the general trend.
Online retail now plays a very important role for many products. For instance, online sales account for around a quarter of purchases made for books and consumer electronics. This figure is nearly 30% for the sports and camping sector, around a third for office furniture and even nigh on 40% for photography items. However, the further growth potential for these products tends to be somewhat restricted. The trend is for online retailers to see higher growth momentum in products for which online sales are already currently rather low.
Online trade is still relatively less important for drugstore goods, integrated kitchen appliances, home improvement articles and furniture. Internet retail is even less significant for foodstuffs. In 2016, the proportion of total sales conducted online in this sector was still under 1%. However, online sales for food and delicacies increased by around a quarter year on year between 2014 and 2016. In light of the considerable pent-up demand compared with other goods, these sectors should continue to see growth momentum in the medium term at least. Furthermore, online trade in general should continue to benefit disproportionately from consumers’ propensity to buy, which is set to continue for the time being at least.