Denmark

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Payments

Domestic and Preferred Card Schemes

Debit and credit cards are also the preferred payment methods. In Denmark Dankort is very popular: a hybrid card which can be use as a debit card and as a credit card. [1]

Alternative Payment Methods

Bank Transfer 46%, Electronic Invoice 41%, Mobile Pay/Swift 28%[2]

Other Payment Methods

Other Foreign Payment Cards 27%, Physical Invoice 27%, Paypal 14%[3]

Digital Invoicing

As of 1 February 2005, all public-sector institutions in Denmark may only accept invoices in electronic format.[4]

Customer Experience

Reinforcing concerns around simple payment methods, the following graphic highlights payment method availability as the biggest concern by respondents to a DIBS survey.[5]

Payments Regulation

Danish law regulates the charges that can be imposed by retailers when payment cards are being used in Denmark. The rule is that the retailer is allowed to impose any surcharge on the card holder when the payment is made with a credit card issued in Denmark or abroad, but not when a debit card, such as the Dankort or an international debit card is used. If a retailer chooses to surcharge for the use of a credit card, this fee may not exceed the fee paid by the retailer to the acquirer, and maximum up to 3.75% per transaction.[6]

Local entities

Dankort and Visa/Dankort is the most used payment system with approx. 85 percent of the online purchases.[7]

Mobile payments

MobilePay is an application for credit card payments using smartphones developed by Danske Bank. The application was published on May 7, 2013, after Danske Bank discontinued its cooperation with other Danish banks on a common solution. It is mainly used in Denmark, but also in Finland and Norway.[8]

Logistics

Although made up of four separate and distinct countries , there are sufficient similarities to treat Denmark, Finland, Norway and Sweden as a collective e-retail market from a logistics perspective. The Nordics present some interesting logistics issues for retailers wishing to reach all of its consumers with a total population of approximately 26 million spread over an area of 120,000 sq km, including hundreds of islands. However most of the population is concentrated in the south and in coastal areas.[9]

Deliveries

Danes and Swedes for example, are more interested in the opportunity to get their products delivered to their homes, Good delivery options were also important, but mostly for Danish consumers (69%). [10]

Copenhagen Airport is the largest airport for passenger, cargo and express companies in the Nordics. The airport also acts as a major cargo hub for global logistics providers such as DHL, Fedex, Kuehne & Nagel and PostNord.[11]

• The BtC (consumer delivery service in Denmark) is still provided under the Post Danmark brand and is a standard overnight delivery (Monday to Friday) to almost all locations. It is a tracked solution and Post Danmark give the customer the option to sign up for its Modtager exit solution which enables them to nominate their delivery preference (home, work, safe-place or pick up) with an SMS or email notification in advance of delivery

• The pick-up option extends to 1,250 locations including post offices and locker stations (Pakkeboksen)[12]

Infrastructure

Post

Direct Link is a fully-owned subsidiary of PostNord, the merged Swedish and Danish post offices, offering a gateway to the Nordics through customised B2C delivery and distribution solutions. It can reach 100% of addresses in all four Nordic countries and o ers a choice of options with light goods directly to the customer’s mailbox, a collection point or home delivery with a ‘leave in safe place’ option.

Direct Link operates facilities in the UK, Germany, US, Hong Kong, Singapore and Australia providing services with the following transit times (subject to point of origin):

• Merchandise Mail – untracked items up to 2 kilos – 3 to 5-day delivery

• Merchandise Mail Plus – fully tracked up to 30 kilos – 3 to 5-day delivery

• MyPack – fully tracked with SMS & email noti cation – 2 to 6-day delivery for items between 0-20 kilos with insurance and integrated returns

• Merchandise Mail Returns – packages up to 2 kilos

In addition to using the local postal service provider as the nal delivery agent, retailers will be able to access services through their own domestic postal providers.[13]

Global carriers

There are a number of global carriers able to provide collection, distribution and delivery into the Nordics (using their own operations or local partners). The main ones are:

UPS - Offers a range of services and delivery times to the Nordics subject to country of origin and the specific destination

• UPS Express Plus – 1 to 2 business days delivery by 09:00

• UPS Express – 1 to 2 business days delivery by 12:00 noon

The example service times above are from the UK.

• UPS Express Saver – 1 to 2 business days delivery by end of day

• UPS Standard – 3 to 5 business days delivery during the day

Fed Ex – Offers two main services to the Nordics with delivery times subject to country of origin and the specific destination:

• International Priority – 1 to 3 business days

• International Economy – 2 to 5 days

DHL – Offers one main service option, namely – Export Express Worldwide – guaranteed delivery by the end of the next possible working day. As an example, from the UK to the Nordics this will typically be the next working day subject to the exact delivery address.

TNT – Offers a range of international services to the Nordics starting from next day by 09:00 subject to country of origin and the specific destination. As an example, from the UK:

• 09:00 Express – Denmark

• 10:00 Express – Denmark and Sweden

• 12:00 Express – Norway and Sweden

• Express – Next day – all countries

• TNT does not offer its lower cost day-defined Economy Express service from the UK to the Nordics

DPD – DPD is particularly of note in the Nordic market because PostNord (the postal service provider for Sweden and Denmark) is a strategic partner and its delivery partner in all four countries. It offers a range of service options to the Nordics with the examples below showing transit times from the UK in business days:

In respect of e-retail deliveries perhaps the two most interesting services are:

• DPD Classic which includes DPD Predict, a pre- delivery advice notification which is a service feature generally welcomed by online shoppers

• DPD Direct which is DPD’s own branded direct access solution (see section – Direct access) offering lower cost consignment + kilo rate pricing, customs clearance, tracking and a returns service for unwanted items.[14]

Import Duties

The delivery operator selected will be able to provide full details and advice on the necessary documentation and processes and some can go further by pre-clearing orders while the goods are in-transit or at the start of their journey using a consumer duty paid process. This can be done using the HTS code assigned to each product category and can reduce delivery times and remove a potential barrier of having the goods held when they arrive in country. Retailers are therefore advised to specifically ask what their chosen delivery partner can do to facilitate customs clearance and duty calculation / collection.[15]

Marketplaces

Atosho

Atosho, established in Copenhagen in 2011, has created a new way for digital publishers to tap into ecommerce revenue and sell products without users ever leaving the site, at the same time providing a unique sales channel for ecommerce retailers.[16]

Trendsales

Trendsales is Denmark's largest fashion bazaar with the purchase, sale and exchange of branded and designer goods to those who love fashion and shopping. Trendsales acts as a contact facilitator between private buyers and sellers, and there are over 150 different categories with branded clothes, accessories, designer furniture, clothing, computers, mobile phones and much more.[17]

Marketing

Danes are the most frequent online shoppers. Slightly more than one in five Danish consumers (21%) answered ‘yes’, when they were being asked if they shop online at least once a month. This percentage is the highest in the region. [18]

Digital ad-spend is taking up a bigger proportion of overall business expenditure in Denmark. Email is still the consumer’s daily first digital point of contact, followed by news and Facebook.[19]

Cross Border Shoppers

Online purchases from abroad seem to be less popular this period (Q2 2015), as the percentage of Nordic residents who shopped online at foreign sites decreased slightly. This decrease was most noticeably in Norway, although it is still the country with the largest number of people who shop online from abroad in this region. Consumers in all the Nordic countries like to shop online from the United Kingdom. [20]

The most frequent online shoppers are 30-44 years old.[21]

Social Media

Nearly a quarter of merchants are seeing positive ROI from their social media spend, with Facebook by far the most popular. YouTube has a place however as do Twitter and Snapchat. According to a 2015 report by DR Medieforskning, nearly half of all 12-19 year-old Danes are using Snapchat daily while nearly a quarter of 20-29 year-olds are doing the same; a total user-base of over 800,000.[22]

Major shopping categories

Clothing and shoes are the most popular product categories, followed by media and home electronics. [23]

Travel is by-far the most popular vertical for purchases via a mobile device while apparel and electronics are showing signs of expansion.[24]

The key brands to watch, especially in the international space, are Amazon, CDon, eBay, HM.com and Zalando. CDon and Komple are particularly interesting brands worth investigating further.[25]

Major retail holidays

Black Friday has only been around for a few years in Denmark but it has already surpassed the big shopping days before Christmas and Easter. At least 12 percent of all Black Friday purchases were made online, a number that is likely to increase in the coming days as some online stores do not withdraw their money until they've shipped their products.[26]

Legal / Regulatory

For goods of a value under 1000kg or EUR 1000, a verbal declaration at Customs, and presenting the invoice, is sufficient. For higher values, you must deposit at the Customs office: 1) a brief declaration (air or maritime manifest) to conclude the collection of the goods. 2) a common law declaration (SAD, single administrative document), as well as the accompanying documents to allow their clearance. The SAD form can be obtained from Chambers of Commerce or an approved printer. A computerised Customs clearance platform (SOFI: International freight computer system) can be accessed in Customs offices or in some Chambers of Commerce. In the case of deliveries and purchases within the European Community, the declaration of exchange of goods (DEB) or Intrastate declaration must be sent to the Customs service.

As part of the "SAFE" standards advocated by the World Customs Organisation (WCO), the European Union has set up a new system of import controls, the "Import Control System" (ICS), which aims to secure the flow of goods at the time of their entry into the customs territory of the EU. This control system, part of the Community Program eCustomer, has been in effect since January 1, 2011. Since then, operators are required to pass an Entry Summary Declaration (ENS) to the customs of the country of entry, prior to the introduction of goods into the customs territory of the European Union.

The Union Customs Code will fully enter into force in May 2016. It replaces the Modernised Customs Code (MCC) and simplifies various procedures, such as introducing a paperless environment, centralised clearance, and more. You can check the Customs website of the EU for updates. [27]

FX Policies

The fixed-exchange-rate policy means that Denmark's monetary policy is aimed at keeping the krone stable against the euro. Danmarks Nationalbank conducts monetary policy by setting the monetary-policy interest rates. These interest rates are linked to the lending and deposit facilities made available by Danmarks Nationalbank to the banks and mortgage banks. When Danmarks Nationalbank changes its interest rates relative to those of the European Central Bank (ECB), this normally affects the exchange rate of the krone against the euro. Via the money market, the monetary-policy interest rates also affect the lending and deposit rates offered to firms and consumers.[28]

Technology

Almost 30% of all Danish online shoppers used their mobile or tablet to purchase something online during the last six months. Important to recognize as well is that 40% of the mobile shoppers do not complete their purchases because the website is not optimized for mobile interaction and checkout. One in three state that they have cancelled a purchase because the right payment option was missing. [29]

Security

A 2014 survey by Bring highlighted security as the most important consideration for consumers shopping online.[30]

Mobile appetite

The global rank also serves to highlight how advanced Danish consumers are in the adoption of smartphones yet, although the usage of mobile devices is growing, it is also important to note that desktops are still an important component in the digital journey. Apple smartphones hold a slim majority over Android devices. A recent study by the Nordics Smarter eCommerce Group showed that 80% of Danish retailers use a responsive site to optimise the customer experience. App usage is quite low at 6%.[31]

References

  1. ECommerce News. "The Most Common Payment Methods in Europe"
  2. Statista "Payment Options on Commerce Sites 2015"
  3. Statista "Payment Options on Commerce Sites 2015"
  4. Electronic Invoicing Handbook "Electronic Invoicing Handbook"
  5. eCommerce Worldwide. The Nordics Cross Border Passport. "
  6. Smart Acquiring "Denmark Payments in Focus"
  7. Export.gov "Denmark Ecommerce"
  8. Wikipedia "MobilePay"
  9. eCommerce Worldwide. The Nordics Cross Border Passport. "
  10. ECommerce News. "An Analysis of the ECommerce Market in the Nordic Region."
  11. eCommerce Worldwide. The Nordics Cross Border Passport. "
  12. eCommerce Worldwide. The Nordics Cross Border Passport. "
  13. eCommerce Worldwide. The Nordics Cross Border Passport. "
  14. eCommerce Worldwide. The Nordics Cross Border Passport. "
  15. eCommerce Worldwide. The Nordics Cross Border Passport. "
  16. eCommerce Worldwide. The Nordics Cross Border Passport. "
  17. eCommerce Worldwide. The Nordics Cross Border Passport. "
  18. ECommerce News. "An Analysis of the ECommerce Market in the Nordic Region."
  19. eCommerce Worldwide. The Nordics Cross Border Passport. "
  20. ECommerce News. "ECommerce in the Nordics"
  21. eCommerce Worldwide. The Nordics Cross Border Passport. "
  22. eCommerce Worldwide. The Nordics Cross Border Passport. "
  23. ECommerce News. "ECommerce in the Nordics"
  24. eCommerce Worldwide. The Nordics Cross Border Passport. "
  25. eCommerce Worldwide. The Nordics Cross Border Passport. "
  26. The Local Denmark "Danes made Black Friday the biggest shopping day ever"
  27. Santander Trade. "Customs Procedures - Denmark."
  28. Danmarks National "Monetary and Exchange Rate Policy"
  29. About Payments "Online Payment Behaviour in the Nordics"
  30. eCommerce Worldwide. The Nordics Cross Border Passport. "
  31. eCommerce Worldwide. The Nordics Cross Border Passport. "