Summary

The Ireland e-commerce market is expected to register a CAGR of 8.2% during the period of 2022-2027. The primary factor driving the growth of the e-commerce market in the region are strong household internet access, high cross-border spending, and rising smartphone usage, among others.

Key Highlights
The key factors influencing the growth of e-commerce in Ireland include the growing ease, convenience, and security of the payment methods and online retailers investing in making their websites more appealing and user-friendly. The significant growth of alternate payment methods is also boosting the growth of the e-commerce market in the region. Bank transfers and digital wallets are among the two most used payment methods by Irish customers for online sales. Moreover, increasing smartphone penetration and the arrival of advanced digital wallet solution is further expected to grow the e-commerce market in the region.
Furthermore, as per Central Statistics Office, Ireland, the proportion of retail sales generated online for All Retail Businesses was 6.5% in December 2021 and 6.0% in November 2021, compared to 5.8% in December 2020. Moreover, in December 2019, the proportion of retail sales transacted online for All Retail Businesses was 4.1%. The share of online generated sales continued to grow at 3.2% in January 2020, 3.5% in February 2020, and 4.5% in March 2020. the share of online sales in November 2020 was 12.4%, 11.0% in January 2021, and 11.8% in February 2021.
Furthermore, the e-commerce market in the region continues to expand at a faster rate, with mobile internet retailing becoming especially significant. Retailers in the region are launching dedicated mobile apps while store-based retailers rapidly utilize multi-channel options. Click and collect services have become more widely available, allowing retailers to maximize retail potential without incurring delivery fees. In contrast, the consumer has almost immediate access to purchases without planning for deliveries.
Any security doubt or risk in the minds of consumers while shopping online can negatively affect consumers and their motives to purchase products or services online. Their main concern is the stealing of their credit card information. This factor can negatively impact the e-commerce market in the region.
The COVID-19 outbreak has rapidly forced numerous entities (public, business, and private) to become predominantly oriented to e-commerce during the pandemic. Moreover, the pandemic accelerated the move to digital for Irish consumers. The pandemic has increased the scope of e-commerce and the range of services in Ireland despite the deteriorating economic and social situation.


Key Market Trends

Rising Adoption of Card Payments and M-commerce


Market players in the region are optimizing their sites for mobile devices and offer seamless card payments owing to the increase in m-commerce. Consumers in the region are more likely to close a transaction on the go, and card payment is by far the most popular choice for completing the payment.
The factor driving the region's payment acceptance is the government's support for card payments. The Irish government has implemented a debit card interchange fee cap of 0.1%, a 50% reduction on the standard EU cap of 0.2 percent. The interchange fee cap on credit cards was maintained at the EU level of 0.3%.
Other payment methods for online shopping, such as bank transfers and cash, are set to shrink in use. Ireland looks set to become a significant e-commerce market driven by rapid growth in card payments, with digital wallets also growing in line with rising m-commerce and smartphone use.
Mobile commerce is becoming increasingly faster to access and use. 5G mobile access speeds are slowly being rolled out across Ireland, starting in cities and major venues before reaching rural areas. Along with growing smartphone penetration and ease of use, the m-commerce market in the region is expected to grow.
As per the Central Bank of Ireland, total in-store spending amounted to EUR 3.6 billion in March 2022, 15% higher than February 2022, and represented an increase of 34%, or EUR 905 million, compared to March 2021. Total online expenditure increased by 11% compared to February 2022 to EUR 3.1 billion and by 9% compared to March last year. Moreover, Online spending accounted for 47% of overall PoS spending in March, a decrease of 1% compared to February.


The Fashion and Apparel Segment Accounted for Largest Market Share


One of the leading trends in the fashion segment is the direct integration of shopping functionality to the content display on social media, enabling high-speed, inspiring, and selling customer conversion. The audience in the region is increasingly shifting from desktop to mobile, and with increasing m-commerce, the trend is expected to grow further over the years.
As per the Central Statistics Office, Ireland, the percentage of turnover generated by online retail sales of clothing, footwear, and textile was 8.1% in September 2021, and it increased to 14.1% in January 2022.
More consumers flock to e-commerce companies that sell cheap fashionable clothes, referred to as disposable clothes. Despite a drop in discretionary spending, consumers are still purchasing clothes monthly but are opting for disposable items from e-commerce companies, including Dunnes Stores, Tesco Ireland, and discounters.
The fashion industry in Ireland is expanding every year with the increasing number of fashion bloggers, stylists, and influencers. Social media or social commerce plays a huge role in terms of sales growth, recognition, brand recognition, and wealth. Moreover, the rising internet and smartphone penetration also boosts the e-commerce market in the region.


Competitive Landscape

The Ireland e-commerce market is significantly competitive with the presence of several players such as Amazon.co.uk, Tesco Ireland, Argos Ireland Limited, etc. The companies in the region are increasing their presence in the market by introducing new payment systems and new offerings or entering into strategic partnerships or acquisitions.


March 2022 - PlantX Life Inc. announced that its wholly-owned subsidiary, Bloomboxclub Limited, has launched its indoor plant selling e-commerce platform in Ireland. For purchases made through the Irish e-commerce platform, orders will be shipped from a distributor in the Netherlands using the same centralized fulfillment and distribution system as other Bloombox Club operations in Europe.


Additional Benefits:

The market estimate (ME) sheet in Excel format
3 months of analyst support

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