Stefano da Empoli, I-Com. Mapping digital consumer trends in Europe
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1 Stefano da Empoli, I-Com Mapping digital consumer trends in Europe Sofia, EESC Annual Conference, 2 March 218
2 Digital penetration in Europe
3 % of individuals not accessing the Internet in A sizeable digital divide was still affecting Europe in 217 Northern Europe shows the best performance: in Denmark, Luxembourg and Sweden only a tiny percentage of individuals - 2% - were not using the Internet in 217 The worst results are registered by Bulgaria, Croatia and Greece, and Romania where the percentage of individuals not accessing the Internet was 3%, 28% and 27%, respectively Source: Eurostat * n.d. 3
4 Daily Internet usage age bracket in 217 (% of individuals) There is a reverse relationship between age and Internet usage Focusing on the European level, younger people are more inclined to use Internet (92% 16-24, 89% 25-34, 82%, 35-44) while older people - due to lack of skills and given different habits are less digital (73% for 45-54, 57% for and 39% for 65-74) Source: Eurostat *n.d. 4
5 Internet use and activities 217 (% of individuals) sending/receiving s telephoning or video calls participating in social networks finding information about goods and services Sending/receiving s and information research for goods and services are the most frequent activities performed on the Internet. In 217, 72% of EU individuals sent/received e- mails and 65% found information about goods and services Source: Eurostat * n.d. 5
6 Active users of key global social platforms (in millions) Facebook Youtube Whatsapp FB Messenger Wechat QQ Instagram Tumblr Qzone Sina Weibo Twitter Skype In January 218, more than 3 billion people have been using social channels, more than 9% of them by mobile devices Facebook is the most widely used platform with billion users Baidu Tieba Viber 3 26 Messenger / Chat APP / Voip Linkedin Snapchat Social Network Reddit Line Pinterest YY Telegram BBM Vkontakte BBM Kakaotalk Source: Digital in 218, WeAreSocial 6
7 Last online purchase in the 12 months - % of individuals in The most active States in online purchases are United Kingdom, Sweden, Denmark and Luxembourg, with 8% of individuals or more that bought good or services over the internet in the last 12 months. On the contrary, the lowest percentages were registered by Croatia (29%), Bulgaria (18%) and Romania (16%). EU average is 57%. Source: Eurostat *n.d. 7
8 E-commerce in Europe - % of individuals purchasing online to 24 years old 25 to 34 years old 35 to 44 years old 45 to 54 years old 55 to 64 years old 65 to 74 years old Online purchases increased from 3% in 27 to 57% in 217 The highest percentages were found for the and age groups (75% and 7%, respectively) Clothes and sport goods were the items most likely to be purchased online in the EU (37%), followed by travel and holiday accommodation (31%) and household goods (26%) Source: Eurostat 8
9 Internet banking - % of individual users in The best performer was Denmark with 9% of users in 217, followed by Netherlands (89%) and Finland (87%) The lowest percentages were registered by Greece (25%), Romania (7%) and Bulgaria (5%) The most active groups by age were, on average, the 25 to 34 years old and 35 to 44 years old Source: Eurostat *n.d. 9
10 E-Government - % of individual users in In 217, 49% of individuals in the EU used Internet to interact with public authorities The percentage varied considerably across Member States, ranging from 9% in Romania to 89% in Denmark The most popular activity is obtaining information (41% on average in the EU) Source: Eurostat *n.d. 1
11 A strong correlation between E-Commerce and E-Government Interaction with public authorities via websites RO BG HR EL LT HU CY IT PL LV SI ES IE MT EE AT BE EU SK CZ FR FI DE DK SE NL LU UK y =.829x R² = Last online purchase in the 12 months If we perform a correlation between e-commerce and e-governement usage, we find a rather strong link. This means that a higher share of individuals that use internet to interact with public bodies is associated with a higher percentage of people purchasing goods or services over the internet is associated with. Source: Eurostat 11
12 An even stronger correlation between Internet Banking and E-Government Interaction with public authorities via websites BG RO EL CY IT HR SI HU PL ES LV FR AT IE DE EU CZ SK LT MT BE EE LU DK SE FI NL UK y =.7937x R² = Internet banking The correlation is even stronger for Internet Banking and E-Governement. If people use more internet to interact with public authorities, probability that individuals adopt also Internet Banking is higher. Source: Eurostat 12
13 Internet of Things and Big Data
14 Global IoT market size 1,8 1,71 1,5 1,2 in billion $ * 216* 217* 218* 219* The global market value of IoT is projected to pass the one trillion dollars mark for the first time by 217, a significant increase, considering the market was valued at around 6 billion dollars in 214. This represents a 25.1% average yearly increase over the ten-year period Source: I-Com elaboration on Statista data 14
15 IoT market size in the EU 3, 25, 2, in million 15, 1, 5, UK Germany France Italy Spain Netherla nds Sweden Belgium Poland Other countries ,678 71,114 55,444 32,87 24,5 18,584 13,436 9,353 9,17 53, , , ,86 97,927 65,57 57,922 5,199 28,328 26, ,152 Total EU market size amounted to 366 billion euros in 214, with the UK, Germany and France accounting for the majority of the total (55%) Source: I-Com elaboration on Statista data 15
16 The expected annual net contribution of 5G to global growth in billion $ The total GDP contribution of 5G, over the period , is expected to amount to about 3 trillion dollars. An average annual GDP growth of,2% is associated with 5G deployment Source: IHS (217) 16
17 The expected economic contribution of 5G in 235 Billion $ 14, 12, 1, 8, 6, 4, 2, 14% 12% 1% 8% 6% 4% 2% % 5G-enabled output (Billion $) 5G-enabled output (% of total sector production) Source: I-Com elaboration on IHS data 17
18 Data market value in the EU 9, 79,637 in mln 6, 47,42 5,888 54,351 59,539 3, * The data market value is expected to increase from 59,5 billion euros in 216 to approximately 8 billion euros in 22, with the UK, Germany, France and Italy accounting for 62% of the total Fonte: I-Com elaboration on data European Data Market Monitoring Tool, IDC (216) * Baseline scenario 18
19 Data market value in the Big Five EU countries 2, 16, in mln 12, 8, United Kingdom Germany France Italy Spain 4, * Germany has recently been surpassed by the UK that reached a market value of over 13 billion euros and is expected to grow further - at a compound annual rate of 7.5% - to approximately 18 billion euros in 22 Source: I-Com elaboration on data European Data Market SMART 213/63 (1st February 217) 19
20 Data economy impact on GDP, by Member State UK Germany Denmark Netherlands Estonia EU28 Austria Finland Malta Ireland Spain Sweden Belgium Italy France Cyprus Portugal Lithuania Bulgaria Latvia Czech Republic Poland Slovakia United Kingdom Romania Hungary Slovenia Greece Luxembourg * % 1% 2% 3% 4% 5% The impact of data market on EU economies is still small but starts to be significant, ranging in 216 from.59% in Luxembourg to 2.34% in the UK, with an EU average equal to 2%, expected to increase to 2,48% by 22 Source: I-Com elaboration on data European Data Market Monitoring Tool, IDC (216) * Baseline scenario 2
21 The new relationship between companies & consumers
22 Expected services in exchange for personal information 9% 8% 7% 6% 5% 4% 3% 2% 1% % Europe Germany Spain Belgium Italy UK France Netherlands Personalised offers based on your search and purchase history Personalised pricing based on your search and purchase history Staff to make product recommendations based on your online history Personalised marketing s Personalised adverts when shopping online Staff to greet you by name when shopping in store Consumers are tired of the standard marketing approach and largely perceive them as spam. As they provide personal data, they are currently expecting brands to have solutions that use it intelligently and often reward those brands that do so Source: Osborne Clarke European connected consumer November
23 Companies using messaging achieve better financial results 3.% 25.% 24.5% 2.% 19.4% 15.% 15.5% 15.% 1.% 9.8% 8.6% 5.% 5.7%.% ROMI Annual company revenue Cross-sell and up-margin per customer Companies using messaging All others 1.1% Average profit margin per customer Source: Customer Messaging, Aberdeen Group 23
24 Top Social Care Industries Facebook Twitter Telecom 88.6% Telecom 51.8% Airlines 84.2% Finance 43.4% Finance 82.7% Airlines 42.8% Retail 78.% Services 38.8% Industrial 73.3% Gambling 37.9% Conglomerate 71.2% Retail 31.2% Services 7.8% Industrial 3.7% E-commerce 69.9% Travel 26.% Beauty 67.9% Accommodation 23.7% Household Goods 67.2% Electronics 21.6% The benefits of Social Devotion are clear: socially devoted brands have 3.5 times more interactions than their less-responsive competitors. Telecommunications is by far the most open and reactive industry on Facebook and Twitter, answering to 88.6% and 51.8%, respectively, of their likers/followers Source: 24
25 Perceived Benefits - Chat Bots vs Apps 24-hour service Good customer service Quick answers to simple questions Chat-Bot Apps Timely complaint resolution Detailed answers Convenience Easy communication Friendliness Easily register complaints Quick answers to complex questions In this super dynamic environment, chat-bots enter and promise a faster and more intelligent experience in line with consumer expectations. The chances for chat-bots are even greater, when compared directly with Apps, an area where businesses have invested heavily, as chat-bots have scored the highest in every regard Source: Chat Bots, a Consumer Research Study, My Clever
26 Conclusions Internet is revolutioning the relationship between businesses and consumers allowing tailor made commercial offers and more efficiency for enterprises. The most important mission for EU institutions and national governments is ensuring that no country or group is left behind by the digitalization process Institutions should encourage adequate investments in connectivity but also in digital services (with a direct role to play in e-government) reducing barriers to the digital transformation The presence of competing providers and/or services maximizes efficiency so public institutions should refrain from interfering in market mechanisms Privacy and security as well as unfair business practices are areas which deserve a tight oversight and, in case of breaches, severe sanctions 26
27 Thank you! Silvia Compagnucci Stefano da Empoli Maria Rosaria Della Porta Giacomo Leone Gloria Marcotullio Giusy Massaro Piazza dei Santi Apostoli Roma tel fax Rond Point Schuman 6 14 Bruxelles tel () info@i-com.it 27
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