Sweden manager Gulfem Toygar says so Today’s Industry.
Amazon’s presence in Sweden was expected to turn online shopping upside down in the Nordic market, and that the Swedish market was only the first step of many looking for market share in the Nordics. But success has been slow to come.
DN has on several occasions written about Amazon’s entry into the Swedish market, and how, among other things, Elkjøp and Komplett had already in 2020 been preparing for several years for the online giant’s entry into the Norwegian market.
So far, Amazon has not once entered the Norwegian market.
– It will have significant consequences for Norwegian trade. Amazon stands for an enormous selection, fast delivery and low prices. Because of the corona, Norwegians have also become more positive about shopping online, and the pandemic has probably led to an acceleration of that shift in shopping habits.
This is what BI professor Peder Inge Furseth told DN in April 2020 in connection with the Sweden launch. Almost three years later, Amazon is still nowhere to be found in the Norwegian market.
– One could well say that Norwegian commodity trading players have to step up. They have slept in class, he said further.
The Swedish manager describes the Swedish launch with the word “fine”, which she clarifies by saying that it has gone as the company expected. Despite staggering figures from the industry organization Swedish Trade, which point to a reduction of a total of 12 percent for e-commerce in 2022, Amazon Sweden has so far not experienced a loss in sales.
– So far we have not seen any negative effects on the Swedish market, Toygar tells DI.
So, why hasn’t Amazon succeeded in taking the Nordic market by storm, as expected?
Two factors stand out
Toygar points to the degree of maturity and the high proportion of collection points as two factors that stand out in the Swedish e-commerce market.
Just over a year after the Swedish launch in October 2020, Amazon rolled out its subscription service Prime, which promises free home delivery within one to two days and which also includes the streaming service Amazon Prime Video.
– Our usual business model is home delivery, but before we launched Prime I had to understand how long it took customers to get to the pick-up point, was it a day or three? But the Swedish consumers liked having the products delivered to their homes, she tells DI.
Gulfem Toygar tells DI that the Swedes stand out in terms of their level of maturity when it comes to internet use in general and e-commerce specifically, compared to the other markets Amazon operates in. Not unlike the rest of the Nordic population.
– Before we launched, I studied the Swedish e-commerce market and was very impressed. Having an internet usage of around 90 percent and a population where 80 percent shop online are really high numbers. But what also struck me is that there are so many skilled niche players, but on the other hand no really big store with a wide selection. On Amazon you can find everything, we have over 450 million products.
BCG estimated turnover in the billions
It was expected in advance that the launch of Prime would have immediate effects, and the Boston Consulting Group (BCG) estimated that the online giant would turn over a double-digit number of billions within a few years. In addition, BCG estimated that Amazon could take 5–10 percent of the market across the entire Nordic region within five years.
1.5 years later, Amazon has not yet expanded further in the Nordic market.
Amazon shares have experienced a sharp decline over the past year. On Friday, the share could be traded for 97 dollars. There is a decline of just over 40 per cent since March last year, when the share was traded for 164 dollars. The last time the stock was this low was when the pandemic broke out in earnest in March 2020.(Terms)Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links, which lead directly to our pages. Copying or other forms of use of all or part of the content may only take place with written permission or as permitted by law. For further terms see here.
