Anyone who spends any time in Germany quickly discovers that customer service is lacking. Maybe that’s why, despite their hefty criticism of the retailer’s business practices, Germans have taken to Amazon and its customer service, making it the largest and most beloved online retailer in Europe’s biggest economy.
Seattle-based Amazon commands 46 percent of the €48.9 billion German online retail market, according to a recent study by trade association HDE. And the company’s dominance is growing dramatically — it is almost singlehandedly responsible for the €4.7 billion increase in the German market last year after its sales rose by €1.1 billion and its marketplace sales gained €2.1 billion.
The key factor: customer service. For the third consecutive year, Amazon was picked as the country’s best online retailer in a study conducted by the Service Value Institute on behalf of Handelsblatt. The study looked at 597 brick-and-mortar retailers and 954 web shops in 97 different sectors from fishing shops to tools.
There are hardly any bad (online) shops today. Kai Hudetz, IFH retail research institute
Amazon was categorized as a generalist and swept that category with top honors bestowed by 33.3 percent of respondents and clearly outpacing its competition — second-place eBay got 9.4 percent of the votes and Otto, a well-known German catalog retailer, third with 6.8 percent. “Shopping that covers basic needs now almost exclusively happens at Amazon," says Kai Hudetz, a trade expert and managing director of the IFH retail research institute.
The kudos comes despite hefty criticism of the online retailer. During the annual German Retail World convention in Berlin in November, Ralf Kleber, Amazon’s Germany CEO, was booed on-stage when asked about the company’s tax practices.
Perhaps it’s this distaste for the web giant that is helping traditional stores have a chance, especially since pre-fab online shops have become so easy to configure. "There are hardly any bad [online] shops today. We're talking about nuances of very good," says trade expert Hudetz. And it’s traditional retailers who, behind Amazon, have made the biggest online improvements. Last year their internet sales gained 12.8 percent, compared to 10.8 percent growth for purely online retailers.
Florian Kolf leads a team of reporters covering the retail, consumer goods, luxury and fashion markets. To contact the author: [email protected]