Logo of fast fashion e-commerce company Temu displayed on a mobile phone. LEHTIKUVA / AFP
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Online shopping in Finland grew by 4% in 2024, reversing a two-year decline, according to a study by the Finnish Commerce Federation. Purchases from domestic retailers increased by just 2%, while spending on foreign e-commerce rose by 9%. International retailers now account for over 37% of Finnish online purchases.
Finns spent nearly €5.4 billion on online shopping last year, with health and beauty products seeing the largest increase.
Purchases in this category grew by 22%, driven by global trends such as rising demand for supplements, anti-aging products, and Korean and Japanese skincare.
Jaana Kurjenoja, Chief Economist at the Finnish Commerce Federation, said the shift is not just about cheap imports. “Affordable global brands are expanding across multiple product categories. This is particularly visible in health and beauty, where international low-cost options are reshaping the market,” she said.
Men’s increasing use of cosmetics and the emergence of Generation Alpha as a key consumer group are also fuelling growth in the sector. Kurjenoja noted that brands failing to cater to these new trends risk losing market share.
The value of online purchases from outside the EU is not increasing as fast as the volume of orders. While Finnish orders from China grew by several hundred percent, the average price of these low-cost items nearly halved. At the same time, high-value purchases exceeding €150 rose, particularly from the UK, the US, and China.
The flood of cheap imports is affecting local retailers, especially in lower price segments. Kurjenoja warned that the impact is not limited to budget items. “We’re also seeing an increase in high-quality counterfeits and grey-market luxury goods,” she said.
The Finnish Commerce Federation is calling for action to level the playing field between EU and non-EU online retailers. Kari Luoto, Managing Director of the federation, stressed the need for fair competition. “We urge immediate measures to ensure that non-EU e-commerce platforms follow the same rules as European businesses,” he said.
Despite strong consumer demand for foreign online retailers, Finnish e-commerce companies struggle to expand abroad. While foreign retailers hold a 37% share of the Finnish online market, Finnish online stores generate only 7% of their revenue from international sales.
A survey by Digital Commerce Finland and the Finnish Commerce Federation found that many Finnish retailers want to internationalise but face barriers such as a lack of expertise and funding. Finding suitable IT partners and service providers is also a challenge.
Kurjenoja pointed out that Finland lags behind Sweden and the US in key e-commerce metrics, with lower conversion rates and higher shopping cart abandonment. Luoto criticised the Finnish government for focusing too much on industrial policy while neglecting the digital commerce sector. “Productivity and investment in intangible assets like software and data must become a priority,” he said.
HT
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Source: www.helsinkitimes.fi
