Historically, e-commerce has not been a strong source of revenue for the Italian economy. For many years, the tourism industry was the sector with the most online revenue, and e-commerce revenue hardly grew at all. But 2020 changed everything. The lockdown during the COVID pandemic was a boon for online retailers and delivery services, which experienced growth that went into the triple digits.
Now that we are two years into the pandemic and the world is slowly returning to normal, the statistics show us that the increase in online shopping seems to be sticking. In 2019, 31% of Italian consumers reported that they “never” shopped online. In 2022, that percentage had sunk to 22%, while the number of respondents who “sometimes” shop online increased from 24.8% to 29.2%.
E-commerce potential in Italy in 2022 and beyond
Internet penetration in Italy has increased in the past several years, and will continue to do so in the future. Currently, 75% of the population has internet access, meaning that e-commerce retailers have a large potential target market.
Despite the increased internet coverage and the increase in online shopping, however, it seems that many Italian retailers failed to take advantage of the potential sales that the lockdown offered. In a 2021 survey, only 60% of Italian online retailers reported an increase in sales due to the pandemic. But that created a great opportunity for international retailers.
The revenue share for foreign online sellers in Italy reached over 35%, with the most sales coming from China, the UK, and Germany. Italians often shop on major marketplaces, rather than buying from Italian e-commerce sellers — Amazon was the online store with the highest net sales in Italy in 2021.
No matter which country the sale originates in, Italians are doing more and more of their shopping online. 37 million people made an online purchase in 2021, with Italians listing lower prices, greater product range, and convenient delivery as their main reasons for shopping online.
E-commerce sales are increasing
Italian retailers are learning that e-commerce is growing in importance in the digital era. 12% of Italian businesses sell online, of which 79% sell directly to end consumers. But B2C e-commerce sales are growing in popularity. In the last 10 years, 63,000 brick-and-mortar businesses were forced to close because they couldn’t keep up with their online competition. And in 2019, an impressive 6,968 new businesses were registered that sell primarily online.
Smartphones and online payments: how Italians like to shop
In the second quarter of 2022, 79% of visits to retail sites were made using smartphones, while 61% of online purchases were made using smartphones. Consumers used desktop computers to make 37% of purchases, but for only 20% of their retail site visits. This shows us that customers like to browse on their mobile devices, but sometimes prefer to make the actual purchase on a desktop computer.
When paying for their orders, 60% of Italian consumers indicated in a 2022 survey that they prefer to use online payment services like PayPal or Amazon Pay rather than credit or debit cards. Also of note is the fact that 20% of Italian online shoppers feel more confident using cash-on-delivery, perhaps because they are wary of scams or delivery services.
Most popular market segments for e-commerce in Italy
The most popular product category for online purchases in Italy was groceries, for which Italian consumers spent 4.8bn EUR. This was closely followed by apparel, where consumers spent 4bn EUR online. Consumers also spent 3.3bn EUR on furniture and home living, and 1.1bn EUR on beauty and cosmetics. This shows us that the Italian e-commerce market is an attractive market for many retail products that are commonly sold online.
Language for Italian e-commerce
The Italian language is spoken by around 85 million people around the world, including approx. 57 million Italians who speak it as their native language. Italian is also commonly spoken as a native language in Switzerland, where around 700,000 native speakers live.
The vocabulary of the Italian spoken in Switzerland varies somewhat from the Italian used in Italy, but this is usually only significant for more colloquial writing or advertising texts. Informative texts intended for Switzerland can be written in standard Italian without any issues.
Within Italy, a variety of different dialects are spoken, which can be traced back to the times before standardised Italian emerged. In most cases, speakers of the different dialects speak them in addition to standard Italian. Only very old residents or people with little formal education speak dialect as their only language. Dialects are typically used in colloquial speech; there is also a history of theatrical performances in dialect. However, for almost all written texts, standard Italian is used. This means that companies planning to market to Italian consumers can use standard Italian and do not need to concern themselves with the different dialects.
Although nearly all Italian secondary school students learn English, only about 42% of Italians report speaking a foreign language. And even if they do speak a second language, they may not speak it fluently. For this reason, companies should definitely offer their website in Italian if they plan to target Italian consumers.
How Italy has implemented the Digital Services Tax
In Spring of 2020, Italy implemented the Digital Services Tax. It is the Italian corollary to the European Digital Services Tax (DST), which is intended to ensure that the e-commerce giants pay taxes on their revenue in the countries where the sales are actually made. Because an EU-wide consensus could not be reached, a decision was made that each EU nation should independently implement the tax.
The DST is a 3% tax that is levied on companies with a global turnover of 750 million EUR or more, of which 5.5 million EUR come from sales to consumers in Italy. It is expected to generate around 700 million EUR per year in tax revenue and will remain in place until an international agreement is reached and an internationally standardised tax can be implemented.
Notable legal aspects of e-commerce in Italy
There are no significant legal snares to worry about in Italy, as most laws are in line with EU legislation. However, there are sometimes differences in the details.
For example, in Italy, the seller makes a legally binding contractual offer by simply presenting a product alongside the legally required product details and the company’s general terms and conditions. Consequently, the sales contract is realised as soon as the customer places an order, and it cannot be declined by the seller. This is in contrast to the German system, in which the sales contract is not realised until the seller confirms the order. It’s a small difference, but worth bearing in mind.
2020 was a difficult year across the board, but it was a turning point for Italian e-commerce. Lockdown forced millions of Italians to discover the convenience of online shopping. E-commerce is taking off in Italy and the trend looks to be stable. As part of the EU, Italy has commerce legislation that will be generally familiar to companies who are already doing business in Europe. A webshop for Italian consumers will definitely need to be translated into Italian, but aside from that the barrier to entry is low. Overall, Italy is an interesting and relatively uncomplicated target market for companies who are looking to expand to new regions.