German eCommerce Sales Fall as Consumers Avoid Nonessentials

Online shoppers in Germany are displaying a “just-the-basics” approach to spending.

A report Thursday (April 6)  from German eCommerce association BEVH showed that online sales of goods fell 15% during the first quarter of 2023 compared to the same quarter in 2022.

That was the last quarter with positive growth, even with the outbreak of the Russian-Ukraine war, the report said.

“The list of political uncertainties not only remains long, more and more are being created. Online trading will therefore continue to consolidate this year,” BEVH Deputy Managing Director Martin Gross-Albenhausen said in the news release, translated from German.

“People are deferring purchases that are not urgently needed, such as fashion, jewelry and entertainment items. It looks better in ranges that are used for daily supplies or for everyday use at home.”

According to the report, the fashion industry saw the largest drop in sales at 20.8%, with “everyday goods” experiencing the lowest decline at 3%. Out of all the categories tracked by BEVH, just one — online food retail — saw an increase, at 3.7%.

The BEVH findings came the same day that Mastercard released its monthly SpendingPulse report for the U.S. Though that report showed eCommerce spending up, it also noted that consumers were shifting their spending away from nonessential items.

“There are a number of factors influencing how today’s consumer is shopping including inflation, the labor market, food and gas prices, and the path of interest rates,” Steve Sadove, senior advisor for Mastercard, said in a news release.

“But they’re still spending — we’re seeing varied growth sector by sector, with purchases largely shifting to necessities and experiences.”

Recent research by PYMNTS examining consumer sentiment on inflation found that 74% of shoppers have cut back on nonessential retail purchases.

And more recently, proprietary research showed that 56% of consumers have been shifting their spending to cheaper grocers and 47% have been doing so for their retailers.

“The fallout, at least over the next couple of months, may be that the continued ‘downshift’ by consumers hits most retailers and grocers, to the benefit of the discount stores and the Big Box merchants,” PYMNTS wrote last month. “The impact may be prolonged, given the data above that show consumers are settling in for years of price increases.”

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