Sector Trend Analysis – E-commerce trends in France

Note: This report includes forecasting data that is based on baseline historical data.

Executive summary

France was the eighth largest e-commerce market in the world (after Germany and Canada) valued at US$47.3 billion (1.9% market share) in 2020, representing an increase in growth rate of 12.7% from US$29.3 billion in 2016. The emergence of the covid-19 pandemic in 2020 accelerated the growth of the e-commerce sector in France as sales of e-commerce increased by 16.7% from US$40.5 billion in 2019.

From 2016 to 2020, food and drink was the largest product category of e-commerce in France, witnessing a sizeable increase in growth rate of 14.3% (+35.1% from US$8.9 billion in 2019) in retail value sales from US$7.1 billion in 2016 to US$12.1 billion and the largest market share (25.6%) in 2020. Food and drink e-commerce benefitted the most from consumers' reluctance to physically shop with stores in addition to the French consumers enthusiasm for and availability of click-and-collect services.

The increase in growth of e-commerce witnessed during 2020 was due to an expanding interest and penetration of smartphones as a dynamic category within mobile e-commerce.

Store-based retailing was valued at US$442.4 billion (89.3% market share) versus non-store retailing which was valued at US$53.2 billion (10.7% market share) in 2020. E-commerce in France was valued at US$47.3 billion (9.5% market share) in 2020, and experienced the largest growth rate of 12.7% from US$29.3 billion in 2016 (+16.7% from US$40.5 billion in 2019).

In 2020, packaged food witnessed US$6.6 billion in online sales and experienced a compound annual growth rate of 15.4% from US$3.7 billion in 2016 (+33.7% from US$5.0 billion in 2019). In comparison, store-based packaged food sales increased at a growth rate of 1.0% (+1.9% from US$83.0 billion in 2019) from US$81.3 billion in 2016 to US$84.6 billion in 2020.

 

Socioeconomic profile

In 2020, France registered one of the sharpest economic downturns among regional countries, due to the COVID-19 pandemic. The economy is expected to witness recovery over the medium term, supported by easing containment measures, an accommodative monetary policy, and France's Economic Relaunch Plan. Real gross domestic product (GDP) declined in growth by 8.0% in 2020 and is expected to recover and experience an increase in growth of 5.3% in 2021.

In 2020, the country's exports deteriorated as the covid-19 pandemic spread globally, causing supply chain disruptions. Domestic demand was subdued as imports also declined at a slower rate.

At the end of 2020, The European Union (EU) and the United Kingdom (UK) signed the Trade and Cooperation Agreement to eliminate uncertainty and maintain trade between the economies in spite of the UK's departure from the EU's Single Market and Customs Union. As a result, zero tariffs and zero quotas on all goods are set to remain in place, however non-tariff barriers are now in place, which are expected to significantly decrease trade of agrifood products between the two economies. Small and medium exporters on both sides will be the most affected.

Demographics

The total population of France in 2020 was 67.0 million and is expected to reach 65.5 million by 2025 . In 2020, the male population represented 48.4%, female population at 51.6%, and the median age was 42.3 years. France was the seventeenth largest urban populous country globally with 52.6 million people or 80.9% of the population living in urban areas in 2020.

Despite a higher fertility rate than the Organization for Economic Cooperation and Development (OECD) average, French couples delay having children hence single person and childless couples are set to strengthen their dominance across household types. The average French household constituted 2.2 persons. The most common household head was an elderly male, aged 60+, with secondary education, employed at a non-executive level. The average household lived in a relatively large detached house with 5+ rooms and more than 70 square meters, usually built in the 1970s or earlier.

The urban-rural divide in French society is becoming increasingly notable as smaller cities and villages lack state resources and financing, struggle to maintain infrastructure and adopt technological advancements, and ensure proper educational standards.

Consumer income and expenditures

In 2020, the median disposable income per household in France was US$48,635.8, representing a decline in CAGR (compound annual growth rate) of 0.2% from US$49,041.50 in 2016 and −8.0% from US$52,860.80 in 2019. The percentage of middle class households in France has remained stable from 31.9% in 2016 to 32.2% in 2020.

Despite government efforts to improve the labour market situation and enhance productivity growth, French per capita income levels are forecast to grow marginally by 2040. A comprehensive package of tax cuts implemented in the last few years is expected to boost French household purchasing power. Nevertheless, tax and social security contributions as a percentage of gross income are set to remain one of the largest regionally, hampering faster disposable income growth.

An influx of immigrants, and changes in the economic and demographic landscape are set to stimulate expansion of all income classes by 2040. Social class E, the lowest-income class, and higher-income classes are set to witness faster growth through to 2040, providing opportunities for companies offering goods and services to consumers at both ends of income distribution.

In 2020, global e-commerce markets were valued at US$2.6 trillion, representing an increase in CAGR (compound annual growth rate) of 22.2% from US$1.1 trillion in 2016. China was the largest e-commerce market with US$851.8 billion ( 33.2% market share) in 2020, followed by the United States (U.S) valued at US$705.7 billion (27.5% market share) and the United Kingdom (U.K) with values of US$117.6 billion (4.6% market share).

France was the eighth largest e-commerce market in the world (after Germany and Canada) valued at US$47.3 billion (1.9% market share) in 2020, representing an increase in growth rate of 12.7% from US$29.3 billion in 2016. The emergence of the covid-19 pandemic in 2020 accelerated the growth of the e-commerce sector in France as sales of e-commerce increased by 16.7% from US$40.5 billion in 2019.

Top ten global e-commerce retail markets, historic and forecast, in US$ millions using fixed 2020 exchange rate
Country 2016 2020 CAGR* % 2016-2020 Market share % in 2020 2021 2025 CAGR* % 2021-2025
World 1,149,569.9 2,566,482.2 22.2 100.0 2,853,976.1 4,388,739.2 11.4
China 338,507.9 851,794.1 25.9 33.2 932,279.3 1,358,170.5 9.9
United States 337,051.3 705,745.9 20.3 27.5 767,678.9 1,200,898.7 11.8
United Kingdom 66,330.0 117,554.0 15.4 4.6 128,995.4 175,765.1 8.0
Japan 75,055.7 114,756.1 11.2 4.5 123,249.8 151,092.4 5.2
South Korea 43,550.2 104,669.5 24.5 4.1 117,214.5 158,814.9 7.9
Germany 51,894.1 84,251.5 12.9 3.3 96,990.3 129,851.3 7.6
Canada 18,179.5 56,660.8 32.9 2.2 60,675.0 83,228.9 8.2
France 29,308.8 47,257.0 12.7 1.9 53,353.1 72,115.9 7.8
India 13,159.7 41,070.7 32.9 1.6 53,802.7 128,919.6 24.4
Russia 11,163.7 34,055.4 32.2 1.3 39,272.0 74,287.9 17.3

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

E-commerce in France

Prior to the emergence of the pandemic (covid-19) in 2020, the e-commerce market, as a type of retail channel in France, had experienced measured growth. Over the course of 2020 however, the e-commerce channel increased in value growth as the various lockdown measures implemented restricted consumers access to and purchases from stores; stimulating growth in e-commerce for essential grocery and non-grocery items, including fresh food, packaged food and non-alcoholic drinks as well as apparel and footwear, consumer electronics and various homewares and household items.

While positive sales growth was recorded in all product categories across e-commerce during 2020, there were some significant differences noted in the extent of sales growth in categories. The extent of category growth was associated with the availability of the products in store-based retail channels and, in relation to the suitability and deliverability of the product. Food and drink e-commerce benefitted the most from consumers' reluctance to physically shop with stores in addition to the French consumers enthusiasm for and availability of click-and-collect services.

E-commerce in France is forecast to increase in CAGR by 7.8% to reach US$72.1 billion by 2025. The continued growth of the e-commerce market in France will be influenced by the state of the country's delivery services, as 85% of France's online retailers were forced to increase their delivery deadlines due to their inability to cope with the increasing demand for their services during the quarantine lockdown and throughout 2020. Further, e-commerce retailers should recognize the importance and influence of social media as a promotional channel to create seamless transactions between consumers and their purchasesFootnote 1, if e-commerce aspires to maintain growing momentum in a previously matured channel.

E-commerce and mobile commerce market overview

Key market trends

The increase in growth of e-commerce witnessed during 2020 was due to an expanding interest and penetration of smartphones as a dynamic category within mobile e-commerce. The proliferation of smartphones and their increasing convenience in comparison to a PC (personal computer) in accessing the internet allowed those consumers to safely research and make purchases online. It has been estimated that 60% of French consumers used m-commerce at least once during 2020 and this is a sign that the category has well and truly arrived in France's retailing industry.Footnote 2 However, despite the recent proliferation and interest in smartphones, e-commerce is dominated by PC transactions primarily due to the challenges, especially with regards to the security of payments and personal data associated with mobile usage and transactions.

E-commerce retailers have recognized the value and importance of mobile commerce (m-commerce) in 2020 with convenient user-friendly apps in building their current and future omnichannel operations. Innovations in m-commerce apps include partnerships between Carrefour and Google Assistant developed to enable customers to perform their online click-and-collect grocery shopping in-app solely via the use of voice recognition. Another useful innovation during 2020 was Simple Maps, an interactive map showing users the locations of the best retailers, including that sell local and sustainable goods within a limited radius. This app has proven particular popular among the so-called locavores, the numbers of whom have exploded in France since the onset of the COVID-19 pandemic. Further, Paylib has reduced its processing fees for traditional grocery retailers and this enabled the grocer to build and develop its services as a proximity payment solution of choice for the country's innumerable independent small grocery retailers and their patrons. However, e-commerce retailers must continue to address consumer's overall lack of trust surrounding the safety and security of online payments completed via mobile devices. As such, the opportunity exists for leading mobile payment and e-wallet operators to create solutions that may lessen the concerns of online payment for the French consumer.

The advent of 5G is also expected to be one of the major factors spurring growth in m-commerce in France during the forecast period. Despite the publicity that has been seen in France about the potential for 5G radiation to be noxious to human health and the exorbitant cost of the installation of 5G in the structure for mobile telecommunications operators, the higher bandwidth and much faster connection speeds that 5G represents can be expected to provide a welcome boost to the development of mobile e-commerce. In addition, according to Euromonitor, the importance of social media as a marketing forum for companies involved in e-commerce is expected to also result in positive growth for m-commerce due to the increasing importance of the seamless transition between social media marketing and the completion of online purchases via apps. Indeed, social media marketing strategies are constantly improving, with mobile devices increasingly offering greater opportunities than desktops to convert clicks into completed purchases.

France's digital landscape - digital device possession

Covid-19 has accelerated the digitalization of France in 2020, with an above-average growth in the number of internet users connecting through personal computers (PC), mobile phones, tablets or other devices, and in the explosion in demand for faster internet speeds as consumers were restricted to home (working and socializing) seclusion. Of note, despite a high penetration rate for smartphones, less than 30% of French consumers consider their smartphones or tablets as their favourite device for online shopping.Footnote 3

According to Euromonitor, there were 52.3 million internet users in France in 2020, equating to 85% of the country's population. Some 79% of these internet users used a mobile phone to access the internet in 2020. The number of internet users in France is projected to rise to 61.2 million users in 2032, which will make up 97% of the population.

Despite the recent growth in, and use of mobile phones to access the internet, there remains areas for improvement to coverage (such as fibre optic installation), as there are many 'white zones' in France, mostly within remote rural villages, where mobile networks and fixed line internet services are unavailable, affecting a small portion of the total population. Euromonitor notes that this is a major contributing factor to explain why France's connectivity rate lags behind most Northern European countries, even though covid-19 prompted greater demand for high speed internet packages in 2020 resulting in the further development of fibre optic internet in France. Other factors include below-average performance when it comes to affordability and infrastructure.

The deployment of nationwide 5G coverage by 2030 is expected to not only allow increase internet connections with faster download speeds, better video resolution and wider availability of unlimited data packages and pricing but also better protect the consumer against hacking and phishing attacks. Of interest, in reaction to the expansion of 5G, consumers are expected to think about controlling their digital consumption of images and apps in the coming years as the concept of "digital sobriety" gains ground in France.

In 2020, 96.7% of French households had possession of mobile telephones (76.5% of households possessed smartphones) in comparison to just 32.0% of households that had possession of tablets. Despite the larger percentage of French households in possession of mobile telephones, the percentage of those households in possession of tablets experienced the largest growth rate (27.2%) from 12.2% of households possessing tablets in 2016 versus 32.0% of households in 2020. In 2025, the percentage of households in possession of all devices are expected to increase, albeit at lower rates of growth.

Digital device possession in France, historic and forecast (% of households)
Category 2016 2020 CAGR* % 2016-2020 2021 2025 CAGR* % 2021-2025
Mobile telephone 93.6 96.7 0.8 97.2 98.7 0.4
Personal computer (PC) 75.9 84.2 2.6 85.1 88.3 0.9
Laptop 63.2 76.5 4.9 79.2 86.5 2.2
Smartphone 55.6 76.5 8.3 80.4 90.3 2.9
Tablet 12.2 31.9 27.2 37.9 60.0 12.2

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

France's digital consumer - characteristics

The onset of covid-19 caused French consumers to revaluate their consumption habits and reassess their priorities as they adapted to the unusual conditions of the pandemic. As consumers spent more time in home seclusion in 2020, this meant a strong decline in store-based retailing compared to an increase of retailing e-commerce current value sales, as well as a greater uptake of digital payments in 2020. Some consumers also reduced their spending in order to cope with the negative economic impact of covid-19.

'Locavores' (sustainable consumerism; consuming less whilst focusing on quality) became an emerging consumer group during 2020, although its presence was evident in the French retailing industry prior to covid. Among the types of products to benefit from locavores have been artisanal and organic food and drinks as well as locally designed and manufactured apparel and footwear and furniture and home furnishings. The locavore trend has been strengthened amidst widespread distrust over imports of cheap, low-quality mass-produced goods from distant foreign countries, while a certain sense of benign patriotic nationalism, has motivated people to want to provide economic support to the sustainable development of local manufacturing industries,Footnote 4 especially those related to domestically produced agrifood products. Relatedly, an inspired food nationalism continued to grow with messages of Buy French, made popular by government officials and the media highlighting French President Macron's recent speeches regarding the need for food sovereignty at the French and EU level.Footnote 5 Further, with the prevalence of covid-19 movement restrictions and the resulting increased time at home, French consumers began to prioritize essential goods as food trends noted a return to basics approach, with consumers creating dishes from natural, unprocessed products. made and grown in France, often with demands for products inherent to specific regions.Footnote 6

Although digital wallets are popular in other European countries, digital wallets and proximity payments have not taken off in France. Within the niche digital wallet segment, the sudden rise of players and a lack of information makes it look saturated to consumers who lack product knowledge and awareness, and this is also hindering its expansion. Many French consumers, including older consumers, mistrust digital wallets as a payment method (in contrast, there is growing acceptance by retail companies and service providers for digital wallets) and mobile payment is largely restricted to tech-savvy consumers. However, contactless bank card payments did experience an increase in sales made especially when the ceiling jumped from EUR30 to EUR50 in May 2020 to help to encourage the shift away from cash. Overall, French consumers seem to be more attached to traditional payment methods.

Prior to covid-19, Euromonitor identified the following eight trendsFootnote 7 which were identified as the most important to French surveyed consumers, and were likely to continue being part of their lifestyles and behaviours in the future, post-covid.

Experience more
Consumers are seeking authentic experiences that suit individual tastes, preferences and lifestyles. Cloud or 'ghost' kitchens (virtual restaurant concepts) are aimed primarily at millennials who seek simple, high-quality meals at affordable prices.
Healthy living
Perceptions of healthy living are shifting beyond just physical health to represent a much more holistic view, where food, exercise, mental wellbeing and broader lifestyle issues are seen as a whole entity. In light of COVID-19, safety has become the "new" wellness, and consumers are choosing trusted brands. This opens up opportunities for food certifications and services that enable a more transparent and reliable "farm-to-fork" journey.
Shifting market frontiers and locally-produced goods
French society is increasingly diverse, due to a rise in consumers with varied ethnic backgrounds however; also recognized is that the French are also proud of their way of life and supportive of traditional products and services. For instance, due to the fall in demand for certain products (cheese) during covid, industry, government and consumer's growing concerns of food safety prompted an upsurge in demand for locally-produced goods encouraging stakeholders within food supply chains to work together to help support their respective sectors.
Shopping reinvented
Consumers are now making purchases across multiple platforms and want to engage with merchants anytime and anywhere. Online grocery apps such as Jow combines recipes, recommendations and online grocery ordering tapping into a growing demand for convenience, tailored services and the elimination of waste through customizing meal options.
Ethical living
The French are taking a growing interest in environmental and ethical issues. In line with their global counterparts, 69% of our survey respondents said they worry about climate change, and 65% try to have a positive impact on the environment through their everyday actions. The latter was particularly notable among baby boomers (75%).
Middle class retreat
France's wealth gap is fairly low and has been gradually reducing, leading to a rise in middle-class households. However, average disposable incomes fell by 8% over 2014-2019, which alongside rising living costs has made consumers more cost-conscious. Consumer confidence is expected to be hit further by the pandemic, which has impacted most economies. Of note, there has been growing interest in the circular (pre-owned) economy.
Premiumisation
Although French consumers have become more price sensitive, they are demanding when it comes to quality. As a relatively affluent consumer base, they appreciate products with added value in terms of aesthetics, ethical and technical features. 66% of surveyed millennials enjoy trying new products and services, and as many as 52% of baby boomers would rather buy fewer but higher quality things.
Connected consumers
Although most consumers admitted they would be lost without the internet, only 28% of French consumers prefer to communicate online rather than in person. Prior to lockdown, only 54% of consumers (but 74% of Gen Z) used phone messaging apps. However, covid-19 forced more consumers online, with many turning to the internet and phone apps for shopping, socializing and entertainment.

E-commerce market: retail sales

Retail sales (store-based and non-store based retailing) in France were valued at US$496.0 billion in 2020, representing an increase in growth rate of 0.9% from US$478.4 billion in 2016. Store-based retailing was valued at US$442.4 billion (89.3% market share) versus non-store retailing which was valued at US$53.2 billion (10.7% market share) in 2020. E-commerce in France was valued at US$47.3 billion (9.5% market share) in 2020, and experienced the largest growth rate of 12.7% from US$29.3 billion in 2016 (+16.7% from US$40.5 billion in 2019).

Store-based retailing is expected to remain the larger retail category in terms of retail sales (US$505.1 billion) in comparison to non-store retailing (US$79.0 billion) with e-commerce (US$72.1 billion) again experiencing the largest growth rate of 7.8% by 2025.

Retail sales distribution by category (store and non-store based) in France, historic and forecast, in US$ millions, using fixed 2020 exchange rate
Category 2016 2020 CAGR* % 2016-2020 Market share % in 2020 2021 2025 CAGR* % 2021-2025
Retailing 478,433.2 495,616.2 0.9 100.0 520,893.1 584,101.8 2.9
Store-based Retailing 442,002.4 442,432.6 0.0 89.3 461,252.5 505,062.5 2.3
Non-Store Retailing 36,430.8 53,183.6 9.9 10.7 59,640.5 79,039.3 7.3
E-Commerce 29,308.8 47,257.0 12.7 9.5 53,353.1 72,115.9 7.8
Direct Selling 3,689.8 3,307.7 −2.7 0.7 3,645.1 4,411.9 4.9
Homeshopping 2,654.6 2,011.1 −6.7 0.4 1,942.7 1,648.2 −4.0
Vending 777.6 607.9 −6.0 0.1 699.6 863.3 5.4

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

Cross-border e-commerce retail sales in France were valued at US$47.3 billion in 2020, with domestic e-commerce retail sales of US$39.7 billion (84.0% market share), and foreign e-commerce retail sales of US$7.6 billion (16.0% market share) in 2020. Of note, both domestic and foreign e-commerce experienced positive growth rates in the historic and forecast periods. Mobile e-commerce however, experienced the largest growth rates of 24.3% and 13.3% respectively in the historic and forecasted periods.

E-commerce retail sales (cross-border and mobile) in France, historic and forecast, in US$ millions , using fixed 2020 exchange rate
Category 2016 2020 CAGR* % 2016-2020 2021 2025 CAGR* % 2021-2025
Cross-border E-Commerce 29,308.8 47,257.0 12.7 53,353.1 72,115.9 7.8
Domestic E-Commerce 25,227.9 39,673.2 12.0 44,449.2 58,748.7 7.2
Foreign E-Commerce 4,080.9 7,583.7 16.8 8,903.9 13,367.2 10.7
Mobile E-Commerce 4,689.4 11,199.9 24.3 12,804.8 21,130.0 13.3

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

From 2016 to 2020, food and drink was the largest product category of e-commerce in France, witnessing a sizeable increase in growth rate of 14.3% in retail value sales from US$7.1 billion in 2016 to US$12.1 billion and the largest market share (25.6%) in 2020.

During 2020 with the emergence of covid-19, greater home seclusion and temporary foodservice closures prompted greater demand for food and drink (+35.1% from US$8.9 billion in 2019). The strong growth rate for food and drink in 2020 can be attributed mainly to the increase in click-and-collect services (known locally as 'drive' as consumers traditionally arrived by car to collect their online orders) offered by almost all grocery and organic retailers as more consumers tried to limit their contact with others and avoid shopping in stores. While food and drink e-commerce represented the obvious option for consumers during the quarantine lockdown, demand remained strong for the category even after quarantine restrictions were eased as many consumers were fearful of shopping in crowded grocery stores due to the perceived risk of contagion.

Although online grocery retailing sales for home delivery were relatively limited before the onset of the covid-19, the drive click-and-collect services operated by some of the country's leading chained modern grocery retailers (especially Leclerc and Intermarché) have long been very popular, accounting for the majority of value sales in food and drink e-commerce in 2020. France has more than 5,000 drive outlets, making it the country with the highest number and greatest coverage of click-and-collect retail outlets in the world.Footnote 8 Among the most enthusiastic adopters of click-and-collect during this period were senior citizens, a consumer group who were previously reluctant to engage with drive retailing, revealing their demand and appreciation for convenience as a consumer trend during 2020. Further, even though click-and-collect drive services were already well-developed prior to covid, the need for home delivery, with the added step of having groceries delivered rather than collecting them from a store, also became appealing to consumers as evident in the strong growth in the offer of home delivery.

A popular development that occurred during covid was the greater emergence of click-and-collect for pedestrians, (launched by leading grocery retailer E Leclerc in Lille in 2016), for mainly urban dwellers who sought to shop close to home rather than drive to a hypermarket to collect their drive orders. Further the convenience and greater variety of products offered via click-and-collect for pedestrians provided additional incentive to those young, active, upper-middle class consumers who rarely use cars for travel within city centres.

E Leclerc maintained its position as the leading player in food and drink e-commerce in France in 2020 and the retailer can attribute this position largely to its status as the most dynamic French grocery retailer. Other rival 'drive' grocery e-retailers such as Carrefour Drive, Auchan Drive and Le Drive Intermarché also experienced heightened demand for their products and services and made the necessary improvements to their logistic systems as well as improve their respective web stores by adapting and offering a wider range of fresh and locally produced food, in response to emerging consumer demand.

Grocery retailing via food and drink e-commerce, particularly through click-and-collect, is expected to maintain its immediate growth momentum into 2021, as ordering groceries online to be collected from a drive-through retail outlet costs less than home delivery and is considered to be far less tiring and much more time efficient than spending one hour or more shopping in a 15,000 square meter hypermarket. This has made drive shopping a particularly popular option among large families many of whom appreciate the special promotions and discounts that retailers offer for drive customers on their websites. Relatedly, the click-and-collect towards pedestrian drive is also expected to continue in the forecasted period as these services cater to the needs of important consumer bases such as senior citizens and millennials, who are more likely than others to live in densely populated urban areas and less likely to own a car or use their cars on a regular basis. In addition, for retailers, moving into pedestrian drive represents a way of continuing to generate growth in their click-and-collect operations at a time when traditional drive services are approaching saturation point.

Innovations within click-and-collect is expected to remain an important aspect of food and drink e-commerce during the forecast period as this service remains a highly dynamic and rapidly changing area of grocery retailing in France. Other innovations offered through Jow, Fly Menu Miam apps, offer consumers access to "shoppable recipes" that help consumers to plan their weekly meals and shopping lists and aligning with consumer's increasing interest in preparing meals at home, from scratch, using fresh ingredients.

Within the food and drink e-commerce category, packaged food made up about 53.8% of the sectors' online sales, while the remaining 46.2% are estimated to come from beverages (hot drinks/soft drinks/beverages containing alcohol) and fresh (unprocessed) foods.

Food and drink e-commerce retail sales are expected to continue to see increasing growth (6.0%) as food and drink sales are expected to reach US$17.1 billion and account for 23.7% of total e-commerce sales in 2025. This continued growth is due to an increase in consumer interest in purchasing edible goods online and increasing mobile e-commerce use.

Overall, e-commerce sales in France are expected to reach US$72.1 billion by 2025, at a CAGR of 7.8%, despite the channel reaching a certain level of maturity in France prior to 2020. E-commerce retailers will need to continue to focus on delivery schedules and marketing via social media in order to continue to see positive growth in the future.

E-commerce retail sales by product category in France, historic and forecast, in US$ millions using fixed 2020 exchange rate
Product Category 2016 2020 CAGR* % 2016-2020 Market share % 2020 2021 2025 CAGR* % 2021-2025
Total E-Commerce by Product Category 29,308.8 47,257.0 12.7 100.0 53,353.1 72,115.9 7.8
Food and Drink E-Commerce 7,081.2 12,082.7 14.3 25.6 13,544.7 17,118.5 6.0
Other E-Commerce 3,540.7 7,900.3 22.2 16.7 9,465.3 17,282.6 16.2
Apparel and Footwear E-Commerce 5,628.4 7,508.6 7.5 15.9 8,432.0 9,721.4 3.6
Media Products E-Commerce 3,559.8 5,668.9 12.3 12.0 6,355.1 8,271.2 6.8
Consumer Electronics E-Commerce 3,776.6 4,548.3 4.8 9.6 4,931.6 5,902.0 4.6
Homewares and Home Furnishings E-Commerce 1,455.8 2,338.1 12.6 4.9 2,609.1 3,396.3 6.8
Personal Accessories and Eyewear E-Commerce 881.9 1,337.2 11.0 2.8 1,514.6 2,036.5 7.7
Beauty and Personal Care E-Commerce 670.1 1,333.6 18.8 2.8 1,371.7 1,610.6 4.1
Consumer Appliances E-Commerce 764.9 1,147.6 10.7 2.4 1,307.8 1,527.7 4.0
Home Improvement and Gardening E-Commerce 532.4 1,041.2 18.3 2.2 1,179.7 1,722.6 9.9
Traditional Toys and Games E-Commerce 579.3 897.5 11.6 1.9 1,009.6 1,263.1 5.8
Pet Care E-Commerce 310.7 537.6 14.7 1.1 574.9 812.3 9.0
Video Games Hardware E-Commerce 211.7 380.4 15.8 0.8 459.0 584.2 6.2
Consumer Health E-Commerce 183.2 348.8 17.5 0.7 394.0 602.3 11.2
Home Care E-Commerce 132.1 186.1 8.9 0.4 203.9 264.6 6.7

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

In 2020, packaged food witnessed US$6.6 billion in online sales and experienced a compound annual growth rate of 15.4% from US$3.7 billion in 2016 (+33.7% from US$5.0 billion in 2019). In comparison, store-based packaged food sales increased at a growth rate of 1.0% (+1.9% from US$83.0 billion in 2019) from US$81.3 billion in 2016 to US$84.6 billion in 2020.

In terms of packaged food e-commerce sub-categories, processed meat and seafood, dairy, baked goods, confectionery and sauces, dressings and condiments were the leading online grocery items purchased by French consumers in 2020. Altogether they made up 72.9% of packaged food's online sales, with processed meat and seafood worth US$1.8 billion (with 26.7% market share), dairy worth US$1.3 billion (with 20.3% market share), baked goods worth US$854.1 million (with 13.0% market share), confectionery worth US$526.7 million (with 8.0% market share) and sauces, dressings and condiments worth US$319.0 million (with 4.9% market share) in 2020. Of note, the rice, pasta and noodles and breakfast cereal categories saw the largest growths of 36.5% and 23.9% respectively from 2016 to 2020, while confectionery increased in growth by 36.5%, sweet biscuits, snack bars and fruit snacks increased in growth by 34.6% and savoury snacks increased in growth by 34.2% from 2019 to 2020. The remaining categories experienced similar increases in growth rates ranging from the lowest (32.1%) to the highest (36.5%) recorded in confectionery from 2019 to 2020.

E-commerce retail sales of packaged foods by category in France, historic, in US$ millions using fixed 2020 exchange rate
Category 2016 2017 2018 2019 2020 CAGR* % 2016-2020
Total Store-Based Packaged Food Sales 81,339.6 81,870.9 82,493.1 83,017.5 84,556.1 1.0
Total E-Commerce Packaged Food Sales 3,695.9 4,270.6 4,621.7 4,908.8 6,562.6 15.4
Processed Meat and Seafood 944.1 1,164.5 1,270.5 1,313.2 1,752.0 16.7
Dairy 820.2 888.7 947.0 999.1 1,333.1 12.9
Baked Goods 512.7 568.4 594.6 640.1 854.1 13.6
Confectionery 289.8 327.4 359.2 385.8 526.7 16.1
Sauces, Dressings and Condiments 186.8 208.2 225.6 239.1 319.0 14.3
Processed Fruit and Vegetables 194.1 226.8 223.6 232.0 309.5 12.4
Ready Meals 153.1 175.2 204.6 221.9 296.0 17.9
Sweet Biscuits, Snack Bars and Fruit Snacks 142.6 149.2 162.7 174.0 234.2 13.2
Baby Food 106.9 141.1 154.3 166.9 222.6 20.1
Savoury Snacks 80.0 96.1 116.0 138.5 185.8 23.4
Ice Cream and Frozen Desserts 107.6 122.4 128.9 126.4 167.0 11.6
Edible Oils 50.9 66.9 77.6 79.3 105.8 20.1
Rice, Pasta and Noodles 28.9 41.6 49.3 75.2 100.3 36.5
Sweet Spreads 42.4 47.6 52.1 59.3 79.1 16.9
Breakfast Cereals 22.0 28.0 37.0 38.9 51.9 23.9
Soup 13.8 18.5 18.7 19.1 25.5 16.6

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

Store-based retail sales of packaged food in France accounted for 92.1% distribution share in 2020 (-0.7% growth rate from 94.7% distribution share in 2016), while e-commerce sales represented a 7.1% distribution share in 2020 (+13.4% growth rate from 4.3% distribution share in 2016), especially through the click-and-collect sales. The categories with the highest online value distribution share in 2020 in comparison to store-based retail sales were baby food (16.0%), processed meat and seafood (11.4%), sauces, dressings and condiments (10.0%), edible oils (8.9%) and processed fruit and vegetables (8.4%). Those categories with the highest growth rates in e-commerce retail sale share between 2016 to 2020 included rice, pasta and noodles (29.4%), breakfast cereals (22.4%), soup (21.9%), baby food (20.9%) and savoury snacks (18.4%).

Store-Based and E-commerce retail sales of packaged foods by % breakdown in France historical
Category Outlet Type 2016 2017 2018 2019 2020 CAGR* % 2016-2020
Total Store-Based Packaged Food Sales 94.7 94.2 93.8 93.6 92.1 −0.7
Total E-Commerce Packaged Food Sales 4.3 4.9 5.3 5.5 7.1 13.4
Edible Oils Store-Based 95.1 93.6 92.7 92.7 90.9 −1.1
E-Commerce 4.9 6.3 7.1 7.1 8.9 16.1
Ready Meals Store-Based 95.9 95.6 95.2 94.9 93.7 −0.6
E-Commerce 2.9 3.3 3.8 4.0 5.3 16.3
Sauces, Dressings and Condiments Store-Based 93.6 93.0 92.5 92.2 90.0 −1.0
E-Commerce 6.4 7.0 7.5 7.8 10.0 11.8
Soup Store-Based 98.0 97.2 97.1 96.9 95.8 −0.6
E-Commerce 1.9 2.8 2.9 3.1 4.2 21.9
Sweet Spreads Store-Based 97.2 97.0 96.8 96.3 95.4 −0.5
E-Commerce 2.7 2.9 3.1 3.5 4.4 13.0
Baby Food Store-Based 92.5 90.0 89.0 88.0 84.0 −2.4
E-Commerce 7.5 10.0 11.0 12.0 16.0 20.9
Dairy Store-Based 96.0 95.6 95.4 95.2 93.8 −0.6
E-Commerce 4.0 4.4 4.6 4.8 6.2 11.6
Baked Goods Store-Based 96.3 96.0 95.8 95.6 94.6 −0.4
E-Commerce 3.2 3.5 3.6 3.8 4.9 11.2
Breakfast Cereals Store-Based 97.1 96.4 95.3 95.0 93.5 −0.9
E-Commerce 2.9 3.6 4.7 5.0 6.5 22.4
Processed Fruit and Vegetables Store-Based 92.6 91.8 92.0 92.0 90.4 −0.6
E-Commerce 5.5 6.4 6.4 6.6 8.4 11.2
Processed Meat and Seafood Store-Based 91.2 90.1 89.5 89.4 87.1 −1.1
E-Commerce 6.5 7.9 8.6 8.9 11.4 15.1
Rice, Pasta and Noodles Store-Based 98.5 97.8 97.5 96.3 95.8 −0.7
E-Commerce 1.5 2.2 2.5 3.7 4.2 29.4
Confectionery Store-Based 94.8 94.4 94.0 93.6 92.1 −0.7
E-Commerce 3.9 4.3 4.7 5.0 6.9 15.3
Ice Cream and Frozen Desserts Store-Based 86.7 86.7 87.0 87.3 86.4 −0.1
E-Commerce 4.8 5.3 5.4 5.4 7.0 9.9
Savoury Snacks Store-Based 97.0 96.6 96.1 95.5 94.3 −0.7
E-Commerce 2.8 3.2 3.7 4.3 5.5 18.4
Sweet Biscuits, Snack Bars and Fruit Snacks Store-Based 95.2 95.1 94.7 94.4 93.0 −0.6
E-Commerce 4.4 4.5 4.8 5.1 6.7 11.1

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

Foodservice was a limited e-commerce industry in France with retail sales of US$4.2 billion in 2020, while representing the largest increase in growth of 40.9% from US$1.1 billion in 2016 (+14.4% from US$3.6 billion in 2019).

In terms of the effects of covid-19 in the foodservice e-commerce industry, foodservice types such as limited-service restaurants fared the best, due to their format being more adaptable to meet changing consumer needs, in addition to the fact that home delivery/takeaway options were already notable within this category - especially so via online ordering of pizzas and burgers within a consumer audience aged 15-35. Furthermore, limited-service restaurants have a higher share of chains, thus stronger resources overall.Footnote 8

Presently, the strong growth recorded in the popularity of foodservice delivery (like Deliveroo France- a food delivery company and app that allows customers to place and pay for a food order from their restaurant of choice and have it delivered)Footnote 9 means that having meals delivered has practically become a cultural phenomenon in France, especially with the restrictions implemented by covid-19 as people 'cocooned within their homes for the durations of the rolling lockdowns. Post covid, this bodes very well for the development of home delivery for food and drink e-commerce, although the high cost of last-mile logistics in Paris and other major French urban areas is likely to remain a sticking point in terms of high prices for customers and low profitability for category players.

Foodservice e-commerce is expected to experience continued positive growth, albeit at a lower rate of 20.8% as retail sales are forecast to increase from US$5.2 billion in 2021 to US$11.0 billion by 2025. Euromonitor has noted that younger generations will drive the growth of e-commerce in foodservice, as they are more proficient and comfortable with using mobile apps through which they can place orders for their preferred choice of cuisine.

E-commerce retail sales of goods and services by industry in France, historic and forecast, in US$ millions, using fixed 2020 exchange rate
Category 2016 2020 CAGR* % 2016-2020 2021 2025 CAGR* % 2021-2025
Total E-Commerce (Goods and Services) 88,596.5 128,294.7 9.7 150,895.1 225,584.3 10.6
Foodservice 1,053.8 4,156.6 40.9 5,172.4 11,026.3 20.8
Lodging 6,483.8 5,227.0 −5.2 7,051.6 9,912.3 8.9
Retailing 36,453.0 65,799.9 15.9 75,414.8 115,669.0 11.3
Ticketed Attractions and Entertainment 1,809.4 1,005.7 −13.7 1,399.0 3,138.2 22.4
Transport 16,332.2 11,325.9 −8.7 15,692.1 25,856.0 13.3
Streaming Services 1,709.4 4,303.4 26.0 5,322.6 7,160.2 7.7
Bill Payments 5,049.2 11,431.7 22.7 13,923.9 19,883.9 9.3
Other E-Commerce (Goods and Services) 19,705.7 25,044.6 6.2 26,918.8 32,938.5 5.2

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

In 2020, online foodservice retail sales via mobile telephone device in France were valued at US$2.8 billion (67.6% market share), representing an increase in growth rate of 51.4% from US$534.1 million in 2016, followed by purchases via personal computer US$1.1 billion (26.3% market share) and purchases via tablet US$233.1 million (5.6% market share). All device types made significant increases in growth rates within the historic period, with the emergence of covid as a dominant influence, while forecasted growth is expected to continue albeit at lower rates.

Foodservice e-commerce retail sales by device type in France, historic and forecast, in US$ millions, using fixed 2020 exchange rates
Category 2016 2020 CAGR* % 2016-2020 2021 2025 CAGR* % 2021-2025
Total Foodservice E-Commerce 1,053.8 4,156.6 40.9 5,172.4 11,026.3 20.8
E-Commerce - Mobile 534.1 2,807.8 51.4 3,570.8 9,168.3 26.6
E-Commerce PC 417.5 1,092.3 27.2 1,288.3 1,406.8 2.2
E-Commerce -Tablet 95.1 233.1 25.1 281.8 372.7 7.2
E-Commerce - Wearables 7.1 20.7 30.7 26.6 52.2 18.4
E-Commerce - Other Remote Devices 2.7 N/C 4.9 26.2 52.1

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

N/C: Not calculable

Top e-commerce companies and brands

Amazon.com Inc and Casino Guichard-Perrachon SA (through its subsidiary Cdiscount, and through its supermarkets) were the largest companies in terms of e-commerce sales in France with retail values of US$9.6 billion and US$4.6 billion respectively, representing a combined market share of 30.1% in 2020. Galeries Lafayette SA accumulated the largest growth of 99.6% as sales increased to US$1.3 billion in 2020 from US$79.8 million in 2016. In contrast, Apple Inc experienced the smallest growth rate of 3.0% from US$873.8 million in 2016 to US$984.5 million in 2020.

Amazon.com has been a leader in France's e-commerce market. During 2020, the online marketplace registered slower growth, despite attaining the largest value in retail sales for 2020, in comparison to its competitors who focused on food and drink e-commerce within the omnichannel grocery retailing paradigm. Amazon.com experienced significant logistic problems at the beginning of the countries initial lockdown which allowed rival online marketplace competitors like fnac, Darty and Zalando, to better capitalize and respond to rising demand during the quarantine periods.Footnote 1

The competitive environment in e-commerce during the forecast period is expected to be lead by online marketplaces, with 3rd party merchants expected to remain the leading source of sales in the channel. Although Amazon and other noteworthy 3rd party marketplaces recorded below-average sales growth over the course of 2020, it is expected that the 3rd party marketplace model and 3rd party merchants and their partnerships, will remain highly successful in the forecasted period. For example, Amazon's recent partnership with Monoprix/Casino and Maison de la Presse is representative of the online marketplace's continued growth potential as the U.S-based e-commerce giant plans to open it's eleventh warehouse in France during 2021.Footnote 1

Other leading e-commerce companies such as grocery retailer E Leclerc, attained the third largest value of US$3.9 billion in retail sales in 2020 and benefitted from the popularity of their drive services in particular (and recent development of their pedestrian click-and-collect services). Their success has been attributed to their dynamic leadership in terms of diversification and innovation in their nationwide network of supermarkets and hypermarkets, crucial to their click-and-collect services.Footnote 8

Top ten e-commerce companies in France, historic retail value retail sales price excludes sales tax, in US$ millions, using fixed 2020 exchange rate
Company 2016 2017 2018 2019 2020 CAGR* % 2016-2020
Total 29,308.8 33,206.9 37,390.9 40,494.4 47,257.0 12.7
Amazon.com Inc 5,245.3 6,283.1 7,497.0 8,805.7 9,610.4 16.3
Casino Guichard-Perrachon SA (Cdiscount and supermarkets) 3,467.5 3,829.3 4,267.3 4,497.1 4,637.4 7.5
E Leclerc 2,693.7 2,901.6 3,098.8 3,318.9 3,860.9 9.4
Vente-privee.com SAS 1,126.9 1,338.0 1,829.2 2,245.6 2,324.9 19.8
Fnac Darty SA 1,595.3 1,733.2 1,887.7 2,048.7 2,270.9 9.2
Auchan Group SA 1,384.7 1,449.3 1,486.7 1,492.9 1,731.4 5.7
Carrefour SA 846.3 970.3 1,104.8 1,255.3 1,481.6 15.0
Galeries Lafayette SA 79.8 96.7 1,135.0 1,209.0 1,267.5 99.6
Apple Inc 873.8 840.6 830.8 930.8 984.5 3.0
ITM Entreprises SA 459.9 527.1 568.2 642.1 819.8 15.5

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

3rd Party Merchants (Amazon.com Inc) and Amazon (Amazon.com Inc) are the top e-commerce brands in France with share sales value of 10.7% and 9.7% respectively. 3rd Party Merchants (Amazon.com Inc) experienced the largest increase in growth rate (8.6%) as share sale values increased from 7.7% in 2016 to 10.7% in 2020. In contrast, Cdiscount (Casino Guichard-Perrachon SA), a non-food merchant, experienced the largest decline in growth rate (6.9%) as share sales values decreased from 7.2% in 2016 to 5.4% in 2020.

Top ten internet brands (e-commerce) in France, historical retail value retail sales price excludes sales tax, by share sales value (%)
Brand 2016 2017 2018 2019 2020 CAGR* % 2016-2020
Total 100.0 100.0 100.0 100.0 100.0 100.0
3rd Party Merchants (Amazon.com Inc) 7.7 8.7 9.8 11.3 10.7 8.6
Amazon (Amazon.com Inc) 10.2 10.3 10.3 10.4 9.7 −1.2
Leclerc (E Leclerc) 9.2 8.7 8.3 8.2 8.2 −2.8
Cdiscount (Casino Guichard-Perrachon SA) 7.2 6.8 6.9 6.2 5.4 −6.9
3rd Party Merchants (Vente-privee.com SAS) 3.8 4.0 4.9 5.5 4.9 6.6
3rd Party Merchants (Casino Guichard-Perrachon SA) 4.6 4.6 4.4 4.8 4.3 −1.7
Carrefour (Carrefour SA) 1.9 2.0 2.0 2.3 2.4 6.0
Fnac (Fnac Darty SA) 2.9 2.6 2.4 2.3 2.2 −6.7
Auchandrive (Auchan Group SA) 2.5 2.4 2.2 2.0 2.0 −5.4
La Redoute (Galeries Lafayette SA) 2.0 2.0 1.7 −7.8 (2018-2020)

Source: Euromonitor International, 2021

*CAGR: Compound Annual Growth Rate

Opportunities and challenges for Canadian suppliers

Opportunities

Canada-European Union Comprehensive Economic and Trade Agreement (CETA)

The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) was signed on October 30,2016, and entered into force provisionally on September 21, 2017. CETA gives Canada preferential access to the world's second-largest importing market for goods as well as Canada second largest trading partner.

In every province and territory, the Canada-European Union Comprehensive Economic and Trade Agreement (CETA) offers exporters a competitive advantage over exporters from other countries that do not have a free trade agreement with the EU for certain products. CETA eliminates tariffs on almost all exports and provides access to new market opportunities. Exporters also benefit from better export conditions, including:

  • reinforced intellectual property rights
  • more transparent rules for market access

Please consult Canada-European Union Comprehensive Economic and Trade Agreement (CETA) for additional information regarding CETA and what it can do for your business.

In addition, the importance of social media has been identified as a promotional channel to identify and interact with consumers. Further, French retailers are expected to continue to use social media as a platform central to their online operations and identity.

Social media provides opportunity to retailers and exporters alike to build and strengthen their online presence in order to create seamless transactions between the consumer and provider. Canadian agrifood exporters and value-added suppliers can employ this medium to their advantage by creating potential partnerships with not only the French consumer but France's e-commerce retailers and marketplace websites in order to expand their online presence and maximize their online sales, in efforts to promote and leverage Canada's distinct brands.

Challenges

While most of the retailers operating in e-commerce would be satisfied with their operations during the varying restrictions and imposed lockdowns, they should be cognizant that their growth within this channel was beginning to mature prior to the onset of covid-19. As such, potential Canadian suppliers should continue to rely and emphasize the quality and distinctive aspects inherent to the Canada brand in order to maintain relevance and interest within a potentially declining channel.

For more information

The Canadian Trade Commissioner Service:

International Trade Commissioners can provide Canadian industry with on-the-ground expertise regarding market potential, current conditions and local business contacts, and are an excellent point of contact for export advice.

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Resources

  • Business of Apps. Deliveroo Revenue and Usage Statistics (2021), Iqbal, Mansoor. Updated July 23, 2021
  • Euromonitor International, Country economic profile - Economy, Finance and Trade: France Country Report, March 2021
  • Euromonitor International; E-commerce in France, Country Report, March 2021
  • Euromonitor International; Mobile e-commerce in France, Country Report, March 2021
  • Euromonitor; Digital landscape in France; Country Report, April 2021
  • Euromonitor International. Food and drink e-commerce in France, Country Report, March 2021
  • Euromonitor International. Retailing in France. Country report. March 2021
  • Euromonitor International. E-commerce (goods and services) in France. Country report. April 2021
  • Euromonitor International. Packaged Food in France. Country Report. December 2020
  • Global Affairs Canada (GAC), Trade, Trade and investments agreements, European Union, Canada-European Union Comprehensive Economic and Trade Agreement (CETA)
  • United States Department of Agriculture (USDA). Retail Foods; France. Journo, Laurent J. page 3, June 22, 2021

Sector Trend Analysis – E-commerce trends in France
Global Analysis Report

Prepared by: Laurie Bernardi, International Market Research Analyst

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