How to develop e-commerce sales in Germany: Online store vs. marketplace
Expanding into the German market is a step that can bring many benefits to Polish entrepreneurs. Germany, as one of the wealthiest countries in Europe, offers enormous potential for online stores and marketplace sellers. This article will outline key aspects to consider for effectively growing e-commerce sales in Germany.
Why sell in Germany?
Germany is a market with immense purchasing power. According to forecasts, by 2029, the value of the e-commerce market in Germany is expected to rise to €136.80 billion, with an annual growth rate of 8.45%. For Polish sellers, this means access to a large number of potential customers and the possibility of fast delivery, which provides a significant competitive advantage. Additionally, the German e-commerce market is well-developed, and high average consumer incomes may translate into higher revenues.
For more information on the German e-commerce market, see our article: German e-commerce market: Key trends and challenges in 2024.
Requirements for an online store in Germany
To sell in Germany, certain legal and regulatory requirements must be met:
- Identification data (Impressum): The store’s website must include detailed information about the business, such as name, address, phone number, email, legal form, tax registration number, and commercial register number.
- General terms and conditions (Allgemeine Geschäftsbedingungen – AGB): These should contain detailed information about prices, payment methods, delivery costs, and return policies. Customers must have the opportunity to review and accept these terms before making a purchase.
- Right of withdrawal (Widerrufsrecht): Customers must be informed about the right to withdraw from the contract and the procedure for returning goods. Including a sample withdrawal form is advisable.
- Privacy policy (Datenschutzerklärung): It should clearly state how customers’ personal data will be used and for what purpose. The privacy policy must be easily accessible on the store’s website.
- “Add to cart” button: It must indicate that the order is subject to payment to avoid misunderstandings.
Marketplace vs. online store in Germany
Choosing between selling on marketplaces or running your own online store depends on several factors. Here are the key differences:
Marketplace
Advantages:
- Easy start: Marketplaces offer ready-made infrastructure and access to a broad customer base. This can be a simpler solution for new sellers.
- Marketing support: Platforms like Amazon, eBay, or Zalando offer various advertising tools that can help increase product visibility.
Disadvantages:
- Commissions: Marketplaces charge commissions on sales, which can affect profit margins.
- High competition: The market is crowded, and limited promotional opportunities may make it difficult to stand out.
- Lack of brand control: Limited options for customizing the purchasing process can impact brand identity.
Own online store
Advantages:
- Full control: Owning your online store allows complete control over branding, product offerings, and the purchasing process.
- Higher margins: No sales commissions can increase profitability.
- Customization opportunities: Ability to tailor the site to specific customer needs and preferences.
Disadvantages:
- High initial costs: Starting on your own platform may involve higher costs related to site creation, maintenance, and marketing.
- Legal requirements: You need to meet various legal requirements, such as the location of the privacy policy, terms and conditions, and identification data.
If you want to learn about the most popular marketplaces in Germany, we encourage you to check out our article.
How to effectively reach German customers
Language and localization
The website should be available in German. Most German consumers prefer shopping in their native language, which enhances comfort and trust in the store. It is also worth considering localizing the domain with a .de extension and pricing products in euros.
Marketing and advertising
Invest in paid advertising campaigns, such as Google Ads and Facebook Ads, to reach German customers. SEO optimization and ranking the site in German search results are also crucial. Remember, German consumers often start their shopping by searching for information online.
Logistics and fulfillment
Planning logistics processes is key. German customers value fast delivery and low shipping costs. Consider using fulfillment services that can automate and optimize logistics processes. Fulfillment operators can offer quick deliveries and better rates for international shipping.
Expectations of German customers
German consumers expect high-quality products and transparency of information. They also value ecology and sustainability, which can influence their purchasing decisions. Allowing returns and offering various payment options, such as PayPal, invoice, or bank transfer, is also important.
Summary
Expanding into the German market can bring many benefits but requires careful preparation and adaptation to local requirements. The choice between selling on marketplaces and running your own online store depends on your business specifics and resources. It is crucial to tailor your activities to German customers’ expectations, ensuring high-quality service and efficient logistics processes.
Iga Turniak
