The Nordic RegionThe Nordic Region
Overview
Generally speaking, Nordic consumers are early adopters when it comes to technology, they have the highest Internet penetration in Europe, and they have high disposable incomes. A larger percentage of the population uses smartphones than in Europe on average. Living in small countries with languages used by few, the residents of this region have always had an international orientation. The Nordic countries are openWith a combined population of 25 million, the Nordic region—Sweden, Finland, Norway, and Denmark—is ranked as the sixth-largest economy in Europe. Despite being four countries with four languages and cultures, consumer preferences are relatively homogeneous compared with those of other European countries.
Statistics
Population : 25 million
Currency : SEK,EURO,NOK,DKK
Languages: Swedish, Finnish, Norwegian, Danish
Market Entry
IPR
Like all markets of the world, manufacturers need to make sure their intellectual property is protected, whether they produce a physical product or something more immaterial such as software, code, art, or music. Enforcement of protections for physical products, such as stopping counterfeits, by the customs authorities has generally been good, and enforcement was recently strengthened throughout Europe.Enforcing intellectual property rights (IPR) violations on immaterial products has been less of a priority for police and customs in the Nordic countries, and the laws are currently being rewritten to reflect the digital reality. Sweden has been a particular problem for the motion picture and music industries, mainly through the illegal Pirate Bay peer-to-peer service, but also through a lack of responsiveness from the government.
IPR considerations are regulated nationally with the official patent offices. On a regional scale, the Nordic Patent Institute is an intergovernmental organization established by the governments of Denmark, Iceland, and Norway. The Nordic Patent Institute was established to maintain and enhance the patent competencies and services of the national patent offices in the institute’s member states.
Fulfillment
The largest fulfillment centers in Europe are typically located in Benelux, and the Netherlands in particular. Companies that have only one European fulfillment center generally find this is the best location.Regional fulfillment centers are available in every market for larger exporters with special needs. However, the largest brands often prefer a Northern continental Europe location. Regional fulfillment centers could serve both online and brick-and-mortar needs.
Online Payment
Generally speaking, debit and credit cards are the most popular form of payment for e-commerce transactions, and they are preferred over invoices in all Nordic countries.However, the countries vary considerably in terms of the percentage of consumers who prefer to use particular payment methods. Although debit and credit cards are most popular, more than twice as many Danes as Swedes prefer this payment method. Sweden and Finland, on the other hand, report much greater preference for paying directly via bank than do other Nordic countries, according to PostNord (2015).
Major Buying Holidays
• Christmas is by far the largest commercial driver for e-commerce in the Nordic countries.• Halloween and Valentine’s Day also drive some sales.
• Black Friday creates only limited additional sales because the Nordic countries do not observe the Thanksgiving holiday. However, retailers seem to pick up on American holidays to generate extra traffic, so Black Friday could become a significant factor in a few years.
Social Media
Nordic people generally use U.S. and global sites such as Facebook, LinkedIn, Instagram, Twitter, and Pinterest. Facebook is especially dominant, and Norway is one of the few countries of the world where Facebook ranks number one in terms of most-visited sites. (Google is the most-visited site in most other countries.)Digital Advertising
Advertising is a moving target in the Nordic countries. The traditional channels include• Google ads and affiliates.
• Facebook.
• Online newspapers.
• National classified services. Norway, for example, is dominated by finn.no, on which practically all second-hand houses and cars as well as new jobs are posted. This site is also a portal for airplane tickets, houses for rent, boats, and motorcycles.
• Blogs. Paying top bloggers for publicity can sometimes open huge opportunities. This market is going through a phase of professionalism, and bloggers increasingly take on some of the codes of conduct applied by traditional media houses, such as revealing their sponsors.
• Advertisements. Ads on Google are more and more automated, with real-time bidding and automated marketplaces.
Current Market Trends
During 2014, Nordic consumers shopped online for a total of EUR 15.4 billion, according to a PostNord (2015) study. E-commerce–related B2C consignments increased 15 percent on the Nordic market last year.E-Commerce Europe uses a different method for listing the e-commerce revenues, estimating that the Nordic market adds up to EUR 42.5 billion. Growth rates are about the same in this report, between 14.2 percent in Finland (lowest) to 18.1 percent growth in Denmark (highest).
The figures may appear to compare apples and oranges, but more important is how these numbers relate to Europe as a whole and to the rest of the world. In both cases, the region is a leader in per capita spending on e-commerce. E-Commerce Europe suggests that Norwegian e-commerce customers, with EUR 2.592 spent per capita, are the biggest spenders in Europe. Sweden, Finland, and Denmark are among the top countries. The Netherlands also ranks high.
The PostNord study found that the Nordic countries had the second-highest spending per year per capita, after the United Kingdom.
The difference between the two studies can probably be found in that United Kingdom and the Netherlands have an established grocery store e-commerce market, whereas the Nordic countries are still in an early phase of developing this market. The two studies address only commodities, not services or more intangible products such as airplane tickets and hotel rooms. Despite a relatively homogeneous market overall, the four Nordic countries do have differences.
B2C and B2B Interactions
Although B2C e-commerce receives the most attention and research, B2B e-commerce is said to be the larger revenue generator globally. The entry of e-commerce giants such as Alibaba and Amazon into B2B has accelerated the trend of seeing B2B websites become more like B2C. Online B2B sellers now recognize that the customer experience in a B2B environment is just as important as the customer experience for B2C. The Nordic region is no exception to this global trend.
The two markets still have differences; for example, the degree of impulse buying is much lower in B2B. However, the similarities are growing through personalization and customization, interactive catalogs, customer reviews, and real-time inventory availability. B2B commerce may have used static catalogues, e-mail orders, and traditional invoicing in the past, but now vendors and retailers that enter the mass B2B market in the Nordic countries generally need to present the same level of service to their business customers as they would to consumers.
In conclusion, B2B makes up a large part of the market, probably over 50 percent, and B2C is influencing end-user preferences and expectations.
Popular E-Commerce Sites
• Komplett—electronics, domestic, wellness—Norway, Sweden, Denmark, and Finland• Elkjøp—omnichannel electronics
• H&M—domestic, apparel —Norway, Sweden, Denmark, and Finland
• IKEA—furniture—Norway, Sweden, Denmark, and Finland
• Ellos—domestic, apparel—Norway, Sweden, Denmark, and Finland
• Bolia—furniture—Norway, Sweden, Denmark, and Finland
• Dustin—Norway, Sweden, Denmark, and Finland
• Nelly—acessories, apparel—Sweden
• NetOnNet—Norway, Sweden, Denmark, and Finland
• Adlibris—Sweden
• cdon.se—electronics, music, books
• Elgiganten—electronics—Denmark
• Dansk Supermarked—appliances, apparel, general merchandise—Denmark
• Coop—appliances, apparel, general merchandise—Denmark
• XXL—sporting goods—Norway and Sweden
• DealExtreme—Electronics—International
• eBay—International
• Amazon—International