2019 J.P. Morgan Global Payment Trends

2019 Global Payments Trends Report - Ireland Country Insights

IRELAND INSIGHTS REPORT


The Irish e-commerce market represents an opportunity for merchants to engage with high-spending and digitally-savvy consumers. Citizens are also distinguished by a willingness to shop with both domestic and international merchants, with social media a key sales and advertising channel. To help our clients locate, attract and keep their customers, we have tracked and assessed e-commerce developments in 34 mature and emerging markets around the globe.

 

Introduction

 

Gross domestic product growth in Ireland was strong in 2018,1 assisted by the impact of multinational companies relocating intellectual property assets or patents to the country. The underlying economic indicators remain positive: full-time employment increased in 2018, as did household earnings, both of which will be positive for disposable income and should support the expansion of the e-commerce sector going forward.2 Meanwhile, increased consumer spending, particularly among young people, is helping to drive online sales.3

This document is based on projected figures and is subject to change at any time.

A dynamic market fueled by high-spending, youthful shoppers

 

The Irish online shopping market is worth €7 billion,14  a figure that is expected to increase at a compound annual growth rate of 8.6 percent out to 2021,15 aided by a number of unique features that make Ireland an attractive opportunity for merchants hoping to make gains in Europe.

Growth is being driven by a variety of positive factors. One is increased consumer spending among the 25 to 34-year-old age groups: 38 percent shop online at least once a week, which is higher than other age demographics.16 Irish citizens also spend a significantly higher amount of money online each year than most other European countries – €2,767, or 26.6 percent more than the €2,186 European average.17*

Growth can also be explained by a willingness to embrace both domestic and overseas e-commerce merchants. There is strong brand loyalty, with 83 percent of Irish consumers always or regularly doing their online shopping on the same website.18 This loyalty extends to Irish sites, with approximately 60 percent of consumers considering purchasing Irish products as ‘important’ or ‘very important’.19

 

Spending is strong, with appetite for both national and international online merchants

 

This, however, is coupled with a willingness to buy from abroad. Cross-border spending is a key feature of the Irish e-commerce experience, and Ireland has the highest rate of cross-border shoppers in Western Europe, with 84 percent of online shoppers making purchases from overseas.20 Foreign purchases are estimated to account for at least 23 percent of all online sales.21 For Irish consumers, the main drivers of cross-border e-commerce are potentially better deals as well as a wider product selection.22 Popular overseas shopping destinations include the UK (first), China (second) and the US (third).23

On the other hand, domestic e-commerce merchants can capitalize on an appetite from other countries for products with purely Irish provenance. One such local online merchant success story is clothing site Magee, which said it experienced online sales growth of 80 percent per annum in 2018. The company also says that 80 percent of its sales are exported, largely to the US and the UK.24

E-commerce merchants aspiring to trade in Ireland must embrace social media, as this is Ireland’s preferred medium for shopping research, inspiration and information. Irish consumers say social media (38 percent) is the most influential channel along with individual retailer websites for inspiring purchases – a figure that leaps to 94 percent among 18 to 24-year-olds.25 As in other well-developed e-commerce markets, Irish shoppers are also increasingly engaging in Cyber Monday. The event launched in Ireland in 2007 and has risen in prominence over the past decade to generate an estimated €50 million in sales in November 2018.26

 

Delivery speeds a drawback

 

The average expected delivery time for purchases is currently long, at three to five days, perhaps as a result of the high number of international purchases.27 Delivery times of two days or more are expected to be free, but 77 percent of Irish consumers are willing to pay for same-day or next-day delivery.28

Show your security credentials to win over willing mobile consumers  

 

Shopping via smartphone has become a major part of Irish e-commerce, driving 51 percent of the traffic on Irish websites29 and accounting for 42 percent of total online sales.30 Currently worth €2.9 billion,31 the mobile commerce market is projected to expand at a compound annual growth rate of 12 percent out to 202132 to potentially become a €4.6 billion industry.33 Some 29 percent of shoppers make purchases via their mobile phone on a monthly or more frequent basis and this figure is expected to rise to 50 percent by 2023.34

The increasing amount of time Irish citizens are spending browsing on their mobile devices is converting into sales. Mobile browsing sessions increased by 30 percent in the second quarter of 2018 compared with the same period in 2017, and mobile conversion rates increased by 19 percent during the same time period.35

Android is the most popular mobile operating system, used by 56 percent of Irish smartphone owners, with Apple’s iOS second at 43 percent. Browsers are the most popular way to shop on a mobile device, accounting for 55 percent of sales versus 45 percent via apps.36   

While clearly a promising growth market, some reservations still remain around payment safety when shopping on the move. More than half (52 percent) of Irish consumers are concerned about security when making mobile payments.37 Clearly demonstrating strong security measures is important when designing and promoting mobile-enabled e-commerce sites for the Irish market. Irish shopping association Retail Excellence, in conjunction with EU partners Ecommerce Europe, launched the first Irish eCommerce Trustmark in 2016. Some retailers have reported significant increases in sales as a result of their website displaying the mark.38

Cards dominate as state backing drives usage

 

Cards represent the desired method of payment for Irish consumers, with credit and debit cards being used for 60 percent of all online transactions, or €4.2 billion of sales.39 Government policy has helped to support this trend. After an EU-wide cap on interchange fees was imposed in December 2015, the Irish government implemented a debit card interchange fee cap of 0.1 percent, a 50 percent reduction on the standard EU cap of 0.2 percent. The interchange fee cap on credit cards was maintained at the EU level of 0.3 percent.40 While the regulation could reduce the profitability of card issuers and schemes, the Irish government has stated that the cap will help merchants save up to €36 million a year and could boost the attractiveness and merchant acceptance of card-based payments.41 E-commerce is a major part of this drive for card-based spending, as it accounts for 25 percent of all debit card expenditure in Ireland and half of all purchases on credit cards.42

 

Mobile digital wallets on the rise

 

The fastest-growing payment methods are considered to be digital wallets and bank transfers, both of which are poised to grow at a compound annual growth rate of 15 percent out to 2021.43 At present, digital wallets are used for 21 percent of all online sales, while bank transfers account for nine percent of transactions.44 Digital wallet use could be boosted by increasing smartphone penetration and the recent arrival of new digital wallet solutions into Ireland. Domestic banks are also supporting increased use of digital methods: for example, Allied Irish Banks ran promotions in 2018 to help raise the profile and usage of mobile payments among its customers.45 The prominence of digital payments will likely also be furthered in the country as the reach and powers of digital payment providers increase.

Stronger performer when it comes to fraud

 

Ireland’s chargeback rate for 2018 stood at 0.06 percent,46 which puts it in line with the European average. However, the number of people suffering fraud when shopping online stands at just one percent, which is half the European Union average.47 These two figures indicate that Ireland is a relatively strong performer when it comes to fraud. With the dominance of cards as a payment method, fraud rates should continue to improve, as the implementation of the EU’s revised Payment Services Directive will necessitate merchants to adopt Strong Customer Authentication for card-not-present payments.

Key takeaways

 

  • The Irish online shopping market is worth €7 billion, a figure that is expected to increase at a compound annual growth rate of 8.6 percent out to 2021 48
  • Irish citizens spend a significantly higher amount of money online each year than most other European countries – €2,767, or 26.6 percent more than the €2,186 European average 49
  • Mobile commerce accounts for 42 percent of total e-commerce sales 50
  • Cards are the preferred method of payment for Irish consumers, with credit and debit cards being used for 60 percent of all online transactions51

 

Data may vary from historical figures, due to certain categories being re-stated as new information sources have become available.

* J.P. Morgan 2019 Payments Trends – Global Insights Report series includes the following European countries: Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Norway, Poland, Portugal, Spain, Sweden, Switzerland, The Netherlands, UK.

 

Global Payments Trends Reports

International e-commerce success can hinge upon understanding the needs, nuances and growth patterns of individual nations. J.P. Morgan’s Global Payments Trends Reports aims to offer merchants the knowledge they need for global success through in-depth, country-by-country analysis.

About J.P. Morgan

 

J.P. Morgan offers a full suite of payments services to enable a seamless connection across the payments continuum for clients. We bring our consultative expertise, data-driven insights, and local service around the globe to provide a more unified view of payables, receivables and cash management. Merchant Services is the payment acceptance and merchant acquiring business of JPMorgan Chase & Co. (NYSE: JPM) – a global financial services firm with assets of $2.6 trillion and operations worldwide.i According to The Nilson Report, it is also the top merchant acquirer of e-commerce transactions in Europe.ii

 

i JPMorgan Chase & Co. Q4 2018 Earnings Report 2018.

ii The Nilson Report, #1132 May 2018.

 

For more information, please contact:

 

Your J.P. Morgan Relationship Manager or visit: https://www.jpmorgan.com/europe/merchant-services/payment-insights

 

Information contained in this document has been prepared by third parties or obtained from sources which are believed to be reliable; but neither Chase Paymentech Europe Limited nor any of its affiliates warrant the completeness or accuracy of the information contained herein. Chase Paymentech Europe Limited and any of its affiliates shall have no liability to the user or to third parties, for the quality, accuracy, timeliness, or for any special, indirect, incidental or consequential damages which may be experienced because of the use of or reliance on the data or statements made available herein. Third party trademarks, brand names, products and services are only referential and Chase Paymentech Europe Limited and its affiliates disclaims any sponsorship, affiliation or endorsement of or by any such third party.

 

Chase Paymentech Europe Limited, trading as J.P. Morgan, is regulated by the Central Bank of Ireland. Registered Office: J.P. Morgan, 200 Capital Dock, 79 Sir John Rogerson’s Quay, Dublin 2 D02 RK57, Ireland. Registered in Ireland with the CRO under the Registration No. 474128.

Directors: Catherine Moore (UK), Carin Bryans, Dara Quinn, Steven Beasty (US), Eilish Finan

Copyright© 2019

1 European Commission. ‘Autumn economic forecast – Ireland.’ Accessed January 2018.

2 European Commission. ‘Autumn economic forecast – Ireland.’ Accessed January 2018.

3 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

4 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via World Bank, 2017.

5 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via CIA, 2017.

6 World Bank Open Data. ‘Ireland’. Accessed December 2018.

7 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via E-Commerce Foundation, 2016.

8 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

9 Ecommerce News Europe, Ecommerce websites in Ireland see revenue grow 45%, 15 February 2018.

10 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Eurostat, 2017.

11 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Statista, 2018.

12 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via World Bank, 2017.

13 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via ECB Statistical Data Warehouse, 2018.

14 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via E-Commerce Foundation, 2016.

15 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

16 RetailExcellence.ie, 2018. ‘Retail Times: Q1 2018.’ Accessed November 2018.

17 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

18 RetailExcellence.ie, 2018. ‘Retail Times: Q1 2018.’ Accessed November 2018.

19 PWC.ie, November 2018. ‘Irish consumers gear up for Black Friday and Cyber Monday shopping.’ Accessed November 2018.

20 PayPalObjects.com, 2018. ‘PayPal Cross-Border Consumer Research 2018.’ Accessed November 2018.

21 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been estimated for J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

22 RetailExcellence.ie, 2018. ‘Retail Times: Q1 2018.’ Accessed November 2018.

23 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been estimated for J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

24 IrishTimes.com, November 2018. ‘How are Irish shops faring in the online retail apocalypse?’ Accessed November 2018.

25 PWC.ie, 2018. ‘Retail & Consumer Report 2018.’ Accessed November 2018.

26 IrishTimes.com, November 2018. ‘Pricewatch: Irish shoppers happy to embrace Cyber Monday.’ Accessed November 2018.

27 PWC.ie, 2018. ‘Retail & Consumer Report 2018.’ Accessed November 2018.

28 PWC.ie, 2018. ‘Retail & Consumer Report 2018.’ Accessed November 2018.

29 Emota.eu, 2018. ‘2018 Irish Online Economy Report.’ Accessed November 2018.

30 Ecommercenews.eu, February 2018. ‘Ecommerce websites in Ireland see revenue grow 45%.’ Accessed November 2018.

31 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

32 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

33 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

34 PWC.ie, 2018. ‘Retail & Consumer Report 2018.’ Accessed November 2018.

35 RetailExcellence.ie, August 2018. ‘30% increase in mobile browsing sessions in Q2 2018.’ Accessed November 2018.

36 Ecommercewiki.org, July 2017. ‘Ireland B2C Ecommerce Country Report 2017.’ Accessed November 2018.

37 PWC.ie, 2018. ‘Retail & Consumer Report 2018.’ Accessed November 2018.

38 RetailExcellence.ie, August 2018. ‘Expand your horizons with the eCommerce Europe Trustmark.’ Accessed November 2018.

39 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

40 GlobalData.com, January 2018. ‘Payments Landscape in Ireland: Opportunities and Risks to 2021.’ Accessed November 2018.

41 GlobalData.com, January 2018. ‘Payments Landscape in Ireland: Opportunities and Risks to 2021.’ Accessed November 2018.

42 Independent.ie, November 2018. ‘Spending with electronic cards hits a record high of over €18bn.’ Accessed November 2018.

43 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

44 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

45 Independent.ie, October 2018. ‘AIB customers using Google Pay or Apple Pay can get a Brown Sugar haircut for 1c this weekend.’ Accessed January 2019.

46 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Kount, 2018.

47 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via Eurostat, 2017.

48 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company via E-Commerce Foundation, 2016.

49 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

50 Ecommercenews.eu, February 2018. ‘Ecommerce websites in Ireland see revenue grow 45%.’ Accessed November 2018.

51 J.P. Morgan 2019 Payments Trends – Global Insights Report: Data has been provided to J.P. Morgan Merchant Services by Edgar, Dunn and Company, 2018.

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