E-commerce in the EU - so what's the issue?
Welcome to the E-commerce discussion group of DigitalAgenda12.
The workshops at DA12 for Ecommerce are focused on Trust and Payments, including the hot topic of mobile payments.
I have fleshed out some of the discussion points below, but let me know in answer to this introductory Ecommerce blog post what is important to you, what I have missed, your proposed solutions, and we can focus subsequent discussions going forward on these topics.
TRUST
- over 40% of Europeans buy online, but this is highly polarised with lower internet-penetration countries seeing proportionately much lower e-commerce activity
- only 6% of E-commerce is intra-EU state - this cannot be good for competition, and therefore consumers
- according to the EC, 2/3 of consumers won't buy from foreign language sites, and 1/3 of E-commerce sites aren't prepared to have more than one language.
- internet penetration varies across the region - this is perhaps the easiest fix
- Tax, postage rates (and postage service norms) are not harmonised and create confusion for sellers.
PAYMENTS
We will see an acceleration of debate on this topic following the recent green paper "Towards an integrated European market for card, internet, and mobile payments" and the upcoming May 4th Brussels conference on the topic (http://ec.europa.eu/internal_market/payments/cim/index_en.htm)
I already see commercial solutions (Wirecard AG, Skrill Ltd) that ease payments across the region and suit local payment methods, and together with steady debit/credit card usage growth I wonder if this is not a problem that will solve itself.
Mobile payments bring e-commerce into physical shopping. Today there are many non interoperable trials across Europe and elsewhere, but with several competing interest groups (telcos, banks and card networks, technology and internet companies, and retailers) no standards have yet emerged. I've written a short intro here http://oakhallventures.com/mobile-money/.
WHY IS THIS IMPORTANT?
E-commerce and the broader issue of the "Digital Single Market" is important because exclusion from this growing market disadvantages sections of society and limits competition.
E-commerce companies, technology providers, bricks and mortar retailers, industry analysts, and consumers are encouraged to make their opinions known on this discussion site.
Group audience:
Comments
It's a scandal and damaging
It's a scandal and damaging to the European Single Market that the majority of e-commerce cross border contracts are still failing for one reason or another. Businesses, particularly SMEs must support the proposed European Sales Law because relying upon standard contractual terms will ensure more legal certainty and help us to catch up with what's happening in the US and Canada. Here, standard contractual terms have been used for several years to do business inter-state and internationally. Europe is well behind North America so policy-makers in Brussels must continue to seize the initiative to help small and medium-sized businesses. It is these wealth creators that will grow us out of recession!
Cross-border contracts is
Cross-border contracts is indeed an important issue, thus the recent EC proposal for common sales law but that will still take time to be adopted by European Council and Parliament, then further time to transpose by EU Member States, and I understand the model of European contract will be voluntary for the parties. So, next to legislation on contracts, I guess we must consider other (market) incentives for cross-border e-commerce. Big players like e-Bay and Amazon have end-to-end platforms that work for consumers. But what about smaller providers. Evidence, ideas?
Hi Andrew,
Hi Andrew,
From a customer point of perspective, if a local (national) organization can provide a good, why should they look beyond?
If ecommerce providers can't provide reasons to do so, it won't get off the ground.
Another thing to add to Trust are the high or even overpromising expectations ecommerce organizations create when it comes to their advantages over brick&mortar for instance: offering fast delivery, fast customer service and so forth.
For example: Here in the Netherlands, local ecommerce orgs deliver in a day. European etailers with central warehouses -often- can't depending on location, which is also the feedback of customers.
"Tax, postage rates (and postage service norms) are not harmonised and create confusion for sellers" ->
Also way to expensive in relation to the ordered good and delivery time. (of course depending on the logistical partner).
Taxes and delivery costs seem
Taxes and delivery costs seem important indeed. Apparently the lack of transparency is an issue. Some consumers discover hidden costs aften they've order. So I guess asking providers for full transparency would go a long way to promote consumer trust. Transparency on costs, on quality of the service/ product ordered, on delivery conditions, possibility for returning faulty goods. There is extensive EU legislation on consumer protection, people have rigths, but for service providers to act accordingly and transparently, that's another matter. I'd say try associations have a role to play here, imposing some rules of conduct on their members and tracking down bad behaviour.
Andrew, great topic
Andrew, great topic
On trust - this is a bit of rabbit hole as we would love to think we can code Trust and write the algorithm but we cannot. Trust is all to often used in payment terms as the route to mitigate risk and that is not the same as implied brand trust from a consumer. Personally leave trust to the behavioral psychologists...
However mobile payment -this is one we need to find a route to describe the "AFRICA" model. White middle-classed male techies would love to solve mobile payments for the western big banking markets, but each time this is a supply side driven solution driving at a point issue. AFRICA have no legacy and are rapidly jumping past the need for a "bank" and redefining banking, payments, identity, trust and the business model in the process. The choice is to review the supply side solutions or understand how to bring the Africa model to the laggards.
just some thoughts to start this area
I guessit's easier to
I guessit's easier to leapfrog than introducing changes in a business environment with heavy legacy. But your point is very very interesting. Will we see (unexpected) consumer-driven developments in the area of mobile payments? line it happened with sms (phone texts) wwhich took of with consumers much to the surprise of mobile phone companies. Any evidence of that happening?
Tony, Miguel, thanks for
Tony, Miguel, thanks for taking up the issue of payments. To kick off the discussion on mobile payments, let's think from consumers' perspective.
My questions to participants of this forum are: Do you want your mobile phone to become your wallet? What is your experience with using mobile payments so far? Did you ever face interoperability issues when paying with your mobile in another Member State? Or maybe you wouldn't have such an idea for fear of roaming bill?
And here is a short video of our Commissioner, Neelie Kroes, which expresses her vision of the future of electronic and mobile payments in EU. Do you agree with these priorities?
http://www.youtube.com/watch?v=qirJVta828w&feature=youtu.be
Albeit written in late 2009,
Albeit written in late 2009, provides insight into a roadmap for mobile commerce -what Japan did right, which the rest of the world could follow:
- Mobile Online Commerce – 13% of Japan’s online commerce revenue ($9B, +18% Y/Y) derived from mobile in 2008 vs. ~1% in USA; 8% of Japan’s total retail commerce derived from online.
http://www.morganstanley.com/institutional/techresearch/pdfs/Theme_5_Mon...
I'd like add on trustmarks
I'd like add on trustmarks which are used on websites to increase sales. We all need some regulation in this area.
EU has so many different nations speaking different languages, countries have different regulations... It makes it harder when we try to establish one well functioning Digital Single Market.
When I try to buy on different webstores in EU I usually put a lot of effort to find whether the webstore is "real" or phishing. Then I try to find any additional info which would help me to decide whether I should give my credit card details away or not...
I might abandon purchase if I feel that I'm not totally sure it's safe. Sometimes, when the cost is not so big, I go through although I don't feel totally safe.
Trustmarks are made to convince us in such cases. That we are safe, that our data will be processed as the privacy policy says, that the merchandise is good... whatever.
BUT. Trustmarks are often just a pictures and are copy-pasted on fraudulent websites...
What are the DA12 expectations - maybe an EU trustmark?