Irish Online Economy Roars in 2016

For a second consecutive year, Irish e-commerce sites have seen a 45% growth in online revenue. With Ireland’s GDP growing by 5% last year, the Irish online economy is charging ahead 9 times faster than the wider Irish economy.

The 2016 Online Economy study, carried out by Dublin-based digital marketing agency Wolfgang Digital, shows Irish consumers’ appetite to spend money online continues unabated, with a 45% growth in online revenues year-on-year. Retailers saw a very healthy 24% growth while revenues for travel websites surged an incredible 79%. Overall traffic to Irish e-commerce websites was up 17% in 2016.

 “Irish e-commerce websites once again showed extraordinary levels of revenue growth in 2016,” says Alan Coleman, CEO of Wolfgang Digital. “We can expect this rampant growth to continue. Online spend represents 6% of the Irish economy. In the advanced UK market, online’s share of spend is as high as 16%.”

International shoppers share of revenue declines.
The share of retail revenue coming from shoppers outside of Ireland declined sharply however, from 36% in 2015 to 19% in 2016. With the majority of international shoppers to Irish online retailers coming from the UK, the swing from strong pound to euro in 2015, to weak pound to euro in 2016 played a major part in this decline.

”With the finer details of a post-Brexit EU yet to be ironed out, there are some early indicators as to how a post-Brexit Irish online economy might look if online retailers switch their focus to the lucrative European market, says Coleman. “As the €153 billion UK market e-commerce market becomes less accessible to Irish e-commerce websites, the €500 billion European market has to become a priority. The twin factors currently making the European market increasingly attractive to Irish business are the EU’s drive to enhance the “Digital Single Market” and the fact that our competitors in the UK, arguably the world’s most advanced digital media market, are now floating further and further away from the valuable European market.”

Mobile becomes the most popular way to access the web
Smartphones have taken over as the device of choice when accessing the web, with 45% of website traffic on mobile phones, versus 42% on desktop and 13% on tablet. This is the first year mobile traffic has exceeded desktop traffic.

New Google and Facebook ad formats make their impact
Since launching in Q4 2016, Google Shopping has quickly become a top performing online revenue driver. Study participants who’ve adopted generated 30% more revenue in Q4 than those who didn’t.

Facebook’s new conversion focused ad format Dynamic Product Ads also made a noteworthy impact. Launched in H2 of 2016 the early adopter study participants who implemented it reported DPA campaigns generated the best revenue figures they have seen from Facebook yet.

Last week Wolfgang Digital confirmed itself as one of Europe’s leading performance agencies, landing two awards at the European Search Awards in Poland. These recent wins bring Wolfgang’s grand total of international awards wins to an impressive 11.