ELECTRONIC COMMERCE IN SPAIN

Accelerate your business with these expert tips on "E-commerce in Spain". Analyse and discover this TIP!

While Amazon and eBay were thriving in the United States, barrabes.com was opening in Benasque, Huesca, an eCommerce exclusively dedicated to mountaineering and alpinism. It was the online version of a physical shop with loyal customers who were looking for a way to bring their items to shoppers all over Spain. They began selling in 1995, although it would be three years later when the Barrabés brothers They were able to consolidate their business through the creation of a community of users.

It was the beginning of the growth of Internet in Spain. Everything around them was new and exciting. Net users were beginning to surf and test the possibilities of a technology that would not be short-lived. Technical problems seemed indecipherable, speeds were ridiculous and mobiles were only good for talking.

Democratisation of internet access as a starting point

But the open and global nature of the network of networks, its ability to connect an ever-increasing number of users, its reliance on intuitive interfaces to allow access to vast amounts of information make the Internet an inevitable success.

The advent of the PC democratised access to computers and the arrival of ADSL extended geographical coverage as well as signal quality. The commercial Internet is taking hold, first in companies and later in Spanish households, thanks to new payment models capable of winning over the general public: packaged service offers, free subscriptions and flat rates.

The development of the e-Commerce (+) in Spain was possible not only as a result of cheaper fixed broadband access, but also due to the emergence and rapid rise of smartphones and mobile broadband.

The beginnings of the e-Commerce (+) in Spain

The first steps of e-commerce as we understand it today came from traditional businesses and others that were born as a result of the rise of digitalisation.

These pioneering companies show varying levels of success and include the following companies:

THE ENGLISH COURT

At the end of the 1990s, the El Corte Inglés supermarket started its e-commerce business. Later, other divisions were added, such as El Club del Gourmet. However, after some strategic doubts cleared up by the foreseeable arrival of Amazon, El Corte Inglés is definitely committed to online sales with an emphasis on the sale of fashion brands.

When Bezos comes to Spain El Corte Inglés was already the leader in domestic e-commerce with more than 5.5 million unique users and an Internet turnover of more than 310 million euros. The digital transformation that has continued to evolve well despite the pandemic: its online sales showed an increase of 132%, representing some 1.8 billion euros.

From 5.8% of total sales in 2020, e-commerce will account for 17.3% in just one year, registering 760 million visits with an online basket that doubles in-store purchases.

PC COMPONENTS

PC Componentes was born as a physical shop and makes the leap to the internet to sell its components and peripherals, making an investment of 5000 euros. With this, they started to offer their products at affordable prices, good quality and with a good after-sales service.

In 2007, they earned 6.5 million euros. Ten years later, in 2017, they had already achieved 312 million in sales. They have expanded their catalogue to 18,000 items and no longer only offer components, but also televisions, household appliances and smartphones.

His climb continues from Alhama de Murcia: 2-hour delivery service, an order collection network with more than 4,000 pick-up points throughout Spain, flat-rate shipping, improved customer service and a own marketplace with which it aims to conquer the Spanish electronics e-commerce market.

INDITEX

If being a pioneer in e-Commerce, Inditex has managed in 10 years to transform its strategy to the point that online sales already represent 10% of the group's global sales. Since 2007, when it made its debut in e-commerce with Zara HomeEvery year, it has launched new e-commerce stores, which are sober and adapted to each country, taking care of every last detail and imitating the offline shopping experience in a functional environment.

Now all of the company's brands sell onlineand has integrated the online channel in the group's main markets: Europe, Asia, North America, Mexico, Russia, Japan, etc. Inditex's turnaround since before the pandemic has led the textile company to increase sales during the first quarter of 2021 by almost 50% compared to the same period last year.

PRIVALIA

Privalia was founded in 2006 by two entrepreneurs from Barcelona. After its arrival on the market, it experienced a period of strong growth between 2008 and 2011, both in the Spanish market and in its internationalisation process to Italy, Mexico (+) y Brazil (+).

Privalia is one of the startups (+) with the best track record in the history of the digital sector in Spain and as entrepreneurs, Carné and Villanueva have been inspiring and supporting the breeding ground for Barcelona's entrepreneurial environment over the years. Today, Privalia belongs to the French group Vente Privee, after a sale for 500 million euros, the largest sale of a Spanish e-commerce project in the young history of the sector. 

GROUPALIA

Groupalia. Compra Colectiva emerged as an online company offering local leisure, travel, services and products. In 2010, entrepreneurs with experience in the field of eCommerce founded this new platform in Barcelona, copying the successful model of Groupon, created in Chicago in November 2008. However, various vicissitudes have led the firm to a situation of inactivity.

New business in the digital economy

Large e-Commerces are taking their first steps in a context where new technologies are beginning to transform the way products and services are created and marketed. New strategies and new business processes emerge that change the rules of the game in sectors that had never imagined making the leap to the digital economy.

Some projects stand out for their anticipation and success in taking advantage of the opportunities offered by the Internet. They are not pure e-commerce but they were pioneers in the creation of indispensable online services: aggregators, search engines, comparators.

EXAMPLES:

• IDEALIST

Idealistic (with small letters), it is without a doubt, one of the benchmarks in the Spanish real estate sector. Founded in 2000 and based in Madrid, Spain, idealista supports approximately 40,000 real estate agents and 38 million unique monthly visitors in Southern Europe by providing an online classifieds marketplace for home buyers and sellers.

In addition, idealista's CRM, data analysis and online mortgage brokerage tools make it a key destination for potential homeowners and sellers in Spain, Italy and Portugal. Since its idealistic growth, it has not stopped growing, defining a trajectory in which they have had to face the real estate bubble, the crisis, the subsequent economic recovery and the COVID crisis.

• THE FORK

At present, The Fork (which officially changed its name to The Fork in May 2021) allows users to book online in a network of around 80,000 restaurants globally (more than 12,000 in Spain). Restaurants achieve greater visibility, increase their bookings, manage their dining room easily and build customer loyalty. Users save time and optimise the service, as they can see online whether or not there is availability for the day and time they want. 

After its purchase by TripAdvisor in 2014, El Tenedor managed to gain a foothold in 11 countries (Spain, France, Switzerland, Belgium, Italy, Holland, Brazil, Portugal (+), Sweden, Denmark and Australia), thus achieving a stronger expansion and establishing its position as the gastronomic guide of reference. Currently, it operates in 22 countries in which it is present in Europe (+), Latin America (+) and Australia.

Tourism: the driving force behind Spanish e-Commerce in the 2000s

The entire tourism sector, with the hotel industry as a key driver, is starting to lead online projects that will revolutionise the way we travel. Tourism is becoming the driving force behind e-Commerce in Spain.

Airlines, hotel chains, travel agencies and teleoperators are launching the marketing of tickets, stays and tourist services through the web. The Internet adds value and enriches the shopping experience of its users: greater choice, personalisation, promotions, easy payment facilities. E-platforms manage to boost the sale of tourism products and services inside and outside the country to the point of achieving the highest e-commerce revenues in Spain.

eDreams was one of the first, a successful model from its birth in the midst of the Internet bubble in the late 90s until its IPO in 2014, an online travel agency that operates halfway around the world, just like Destinia, Booking or Trivago.

Spanish disruptive models

The startup phenomenon is beginning to manifest itself in Spain with the proliferation of new companies seeking to carve out a niche for themselves in the internet ecosystem. Start-ups are business projects with significant prospects for rapid and exponential growth through the use of new digital technologies. Many of these startups They are backed by major investors and their focus has been on creating disruptive business models in so-called traditional sectors.

EXAMPLES OF SUCH COMPANIES ARE:

• CHICFY

Founded in 2008 and acquired by Vinted for 10 million euros in 2019.

• WALLAPOP

Created in 2013 is the most visited second-hand advertising platform by users in Spain. Thanks to the speed with which its founders obtained funding to start it up and turn it into a benchmark in the market.  

In a short time, its founders were able to obtain sufficient funding to make their idea a reality and turn it into one of the main reference points in the online sales (+), of used products.

The application offers the possibility of dispatching them and of having them users interested in acquiring them can reach them by geolocation. Since its creation, it has not ceased to receive capital injections. It has more than 40 million users, 100,000,000 product uploads and a history of relationships between buyers and sellers that could be the subject of several volumes, and yet it is still going strong, Wallapop is still looking for a business model (+) to grow your income.

• HAWKERS

The story of Hawkers begins, like Wallapop, in 2013, and is the story of two brothers from Elche and two friends from Alicante who meet in a Banesto project and decide to start their own online sales business together. First, they tried selling cups and dildos, but that didn't work, so they went for another unisex product that didn't involve complex logistics. Sunglasses fit the bill, and they sold!!!

The glasses were flying. At such a good pace that when the brand they distributed was unable to meet their demand they decided to start their own. 70 million, had sold two million glasses, were profitable and in another year expected to double their figures.

And, so much success (also some setbacks) has a lot to do with its powerful online strategy and investment in social media.

The e-Commerce boom in Spain: from 127 to 50 billion euros in just 20 years

According to data from the National Commission for Markets and Competition (CMNC), in 2001 e-commerce generated just 127 million euros in Spain. In 2005 it moved 1,547 million, 7,317 million in 2010 and in 2015 it surpassed the 20 billion euro barrier.

At that time, Spain had 31.7 million internet users, of which 20.4 million were online shoppers. On average, they spent 1,016 euros per year, according to the National Observatory of Telecommunications and the Information Society (Observatorio Nacional de las Telecomunicaciones y de la Sociedad de la Información). E-commerce was booming.

Spain opens 2015 with more than 85,000 online shops and up to 22,000 sellers without an individual shop but with a presence in different markets. marketplaces (+). The e-commerce sector is at its best. The number of buyers is increasing. The number of categories and products that are available online is multiplying, and the escalation continues!

SMEs and the self-employed are launching themselves into e-commerce, in search of an business opportunity (+) extra, based on good technological solutions and cost-effective multi-channel and multi-platform strategies for your project. At 2015, many companies with a traditional sales channel had already decided to create their own online shop, which would allow them to reinforce their brand identity and build a customer base enriched with individual information on consumption habits, purchase history, frequency...

Other businesses are digital natives and start from scratch with their own e-commerce (and in time, many will explore the reverse path to the physical shop), including those that exploit such a classic model as classified ads, such as Mil anuncios. And, on the horizon of both, always, the marketplaces. Amazon, Aliexpress, eBay, Wish... large digital showcases that attract a very attractive flow of customers for any company and that have good reasons to be chosen as a sales channel on the Internet, and that with their sustained growth over time have led to the emergence of agencies specialising in them such as Tandem.

e-Commerce: the mobile factor

In 2015 eCommerce B2C is expanding in a context where online purchases made from mobile devices stand out, so, from here, having a good strategy to meet the needs of users through these devices and investing in a responsive website is essential for success.

In that year, Spain was already the EU country with the highest percentage of smartphones, ahead of the UK, Italy, France and Germany. 81% of mobiles were smartphones, which means that 21 million Spaniards access the Internet daily from their mobiles.

They inform themselves about the products they want to buy, use it at the moment of the purchase decision or buy directly via their smartphones. Since then, the growth of smartphone shopping has not stopped and the popularisation of mobile has not stopped contributing to e-commerce.

...And growth continued in 2016/2019...

In 2017, Spanish e-commerce surpassed the 30,000 million euro barrier, and if the €40 billion mark was almost reached in 2018 In terms of annual turnover, the latest data, made public in July 2020, show that online sales are still going strong in Spain, 48.8 billion in 2019, according to CNMC data.

In 2020 the coronavirus drives online shopping in Spain. The VII Annual Study of e-Commerce in Spain 2020, carried out by IAB Spain and Elogia, highlighted the effect that confinement has had on Spaniards' online shopping habits.

During the first half of the year, 51% of respondents stated that they had shopped online more frequently. 39% said they had maintained the same frequency of online shopping. Confinement also led to an increase in the average purchase expenditure; 96 euros compared to 71 euros in the last 12 months. The average for women is 103.9 euros and for men 89.1 euros.

While 2020 posed major challenges for Spanish e-Commerce, these have been overcome: during the fourth quarter of 2020 it grew by 9.3% year-on-year to reach EUR 14,613 million. In addition, During the same period, more than 307 million transactions were recorded, breaking a new milestone as the figure represents an increase of 26.9%. During 2020, e-Commerce in Spain achieved a total of more than 51.6 billion euros, an increase of 5.8% compared to the previous year.

Of course, the pandemic impacted differently on the country's e-commerce industries. Thus, during the fourth quarter of 2020, sectors such as apparel and channel subscription had the highest revenues, while tourism-related branches accounted for only 2.3% of turnover during the fourth quarter of 2020.