Experts doubt the launch of Norwegian Amazon in the near future – E24

In January 2021, a few months after Amazon launched in Sweden, expect E-commerce expert Philip Elverhøy at Oslo Digital said the American giant will come to Norway within the same year.

It didn’t turn out that way, we know now.

– I have to extend this expectation. I still think Amazon will come to Norway as well, but it may take a little longer than expected. It would be strange if they were launched now, given the turbulent economic situation in their largest market, he told E24.

Peratuben has a past as a director in Norway at NetOnNet and as a director of e-commerce at Elkjøp.

Five reasons to doubt

It receives support from the market analysis agency Euromonitor International.

In a note to E24, Senior Adviser Cosmin Dan points to a number of factors that, in short, ensure that he does not believe Amazon has financial incentives to expand into Norway or other Nordic markets at this time:

• Ordering is easy and affordable on European Amazon sites.
• Online shopping has declined dramatically.
• Labor costs a lot in the Nordic countries.
• Shipping in Norway is limited in rural areas and slow even in cities.
• A high percentage of trade unions.

From Amazon to Norway seems unlikely in the near future, Dan sums up.

Doomsday prophecies did not work

Speculation about Amazon going to Norway has often been followed by concerns about the death of stores.

Dan points out that the fear of outperforming the competition and the rise of online shopping through the pandemic have contributed to Norwegian companies improving their online shopping solutions.

Doomsday prophecies did not come true, but consumers received better online shopping offers, and at the same time Norwegian companies were better prepared for increased competition in the future, he writes.

When or if Amazon finally launches in Norway, Elverhøy equally thinks it will feel good for Norwegian retail.

International markets will take stakes, and Norwegian companies must join the world. Look at Zalando, which has captured a large share of textile sales, he says.

Poor growth in Sweden

When Amazon launched in Sweden in the fall of 2020, the early days were marked by concern about embarrassing errors and outrageous translations.

Likewise, there were many Swedes who tested the platform, but the company struggled to build loyalty, notes Kusmin Dan. As a result, growth was also absent.

Amazon’s place in the market hasn’t changed much in the past two years. They have a market share of one to two percent, as it was before the launch of the .se domain.

He notes that it still does not mean that Amazon sees the Sweden launch as a failure, but that the company is considering growing gradually and launching new services.

E24 asked Amazon’s office in Sweden how they view the launch and what kind of plans they have for further growth in the Nordic countries.

Press contact Mikael Åkerström answers in an email that Amazon does not comment on any market shares or expansion plans.

Amazon UK Test Dropped

In anticipation of Amazon’s potential launch in Norway sometime in the future, several Norwegian companies have chosen to be cautious, as E24 wrote two years ago.

Stormberg, Orkla, and Polarn O. Pyret are three companies that have chosen to enter Amazon’s other European markets.

– When Amazon is launched in Norway, the competition will be more intense, and therefore it is important for us to understand how the platform works, said Heg Ekberg, general manager of Stormberg, in 2020.

Ekberg has now left the company. Sales and Marketing Director Nina Johansen wrote in an email that the Amazon project was short-lived.

We did a little test with Amazon in the UK, but we found that this was not the right time for us to enter this platform.

She writes that Stormberg is constantly following Amazon’s development, but adds that this is not something they care about very much.

Expect a slight decrease

When Amazon’s potential entry into the Nordic countries was discussed, the background was an ever-rising curve of Norwegian online shopping.

Development exploded during the pandemic. From 2019 to 2021, growth was 63 percent, according to Virke.

Recently, however, the picture has changed somewhat.

Virke expects online shopping to grow by minus two percent this year and next.

It’s really about an overall outlook for the year ahead, with somewhat weaker growth for the entire retail business, says Jarley Hammerstad, head of industry policy at Virke.

At the same time, he wants to focus on the fact that online shopping has fallen less than expected.

– We see that online shopping has held up to some extent, while there is a decline in many industries. The post-pandemic downturn is an adjustment to the strong growth we’ve seen before, and I wouldn’t call it a downturn in that sense.