Eric Watson's avatar

Eric Watson

January 06, 2017

Market Spotlight: Poland


First mover e-retailers can generate instant and sustained business success in this thriving, influential market.

Eric Watson's avatar

Eric Watson

January 06, 2017

Editor’s Note: Our occasional Market Spotlight blog series continues, this time with a focus on a thriving European market. Come with us to Poland!

We’ve been championing Poland as an expansion-worthy market for years, but we fully expect 2017 to be the year it steps out of the shadow of its Western European neighbors and becomes a bona fide hot market—particularly for growing e-retailers.

There’s a lot to love. In 2016, Poland continued its ascent as a powerful economic and political force. Geopolitical analysis firm Stratfor recently called the country “the vanguard of Central and Eastern Europe,” pointing out Poland’s drive to shape its economic destiny by building relationships with over Central European countries, challenging the European Union on policy, and resisting Russian influence. McKinsey called the market “Europe’s new growth engine” in 2015.

Such autonomy and growth has made the market particularly ripe for foreign brands and e-retailers. Polish consumers’ appetite for e-commerce has grown year over year. Western e-retailers often generate significant success here, mostly because they can often offer products that outclass domestic retailers.

Indeed, we’ve seen such success with our own customers. Recent MotionPoint analysis reveals a nearly 20% rise in Polish traffic to our customers’ translated, localized websites in 2015. One company that leveraged key global-website best practices saw a nearly 75% increase in sessions that year, and a nearly 60% increase in 2014.

If that didn’t make the market savory enough, recent forecasts indicate Poland’s e-commerce market reach $9.1 billion by year’s end, and grow to over $12 billion by 2020. Of that, the two largest segments are the extremely attractive “Fashion” and “Electronics & Media” which will make up 34% and 24% respectively of the total market in 2020. Globally-minded fashion and electronic retailers should take note.

But the time to enter these markets is now. Poland’s domestic retailers have been very slow to leverage to e-commerce to serve its 38 million residents. This means local consumers are underserved, and competition is low. But it won’t be this way forever. Mature global companies, entering the market with high-profile brands and excellent e-commerce experiences—experiences that are already in place, serving domestic markets—stand to gain the most.

Digital marketing is straightforward within this market; familiar social media platforms also are commonly found here. Facebook leads the pack with approximately nearly 18 million users, with just under half of those between the ages of 19 and 33.

Having such widespread adoption of familiar social media platforms should be a welcome sign for expanding companies. Other markets such as Russia (where social network Vkontakte reigns supreme) or China (where Facebook is banned and competing local variants are the only options for serious companies looking to target users) present challenges regarding content management and distribution.

Put another way: the ability to enter a growing market beyond Western Europe and not require company marketers to learn the ins and outs of new social media platforms saves time, money and risk.

Despite a booming smartphone penetration rate (currently at 56.8% and expected to grow to 75.9% by 2020), Polish consumers aren’t embracing m-commerce as rapidly as other markets. The majority of online revenue seems to be generated via desktop browsers, with an approximate 80% / 20% share split between desktop and mobile in the digital advertising market. Our own data confirms this. Between 80% to 90% of our customers’ translated, localized website revenue hails from desktop users during any given time period.

This doesn’t mean e-retailers should neglect Polish smartphone and tablet users. 2015 analytics from MotionPoint-powered Polish websites reveal a notable increase in sessions from mobile and tablet devices. And this is growing. In early 2015, 19% of traffic to Polish sites originated from a mobile device. This share grew to 35% by 2016.

In 2016, we also saw a significant amount of Polish-site traffic (10%) originating from tablets. Considering this, an intriguing buyer persona emerges: a surprisingly “developed” consumer who uses multiple devices for different browsing and shopping purposes. Fortunately, international companies that have already invested heavily in ensuring consistency and ease of use across their online experiences across devices should stand out as a particularly sophisticated offering in the market.

Indeed, this confirms what we continue to see across almost all global markets: users are increasingly viewing sites from their mobile devices, but continuing to transact on their desktop PCs. Ensuring a translated, localized mobile experience is rich enough to make consumers return on their desktop to transact should be a priority for e-retailers expanding into Poland.

This once again emphasizes MotionPoint’s view that sophisticated retailers in developed online markets should seize the first mover advantage and enter Poland or similar markets, where their natural advantage based on experience will lead them to instant and sustained business success.

 

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