CITC Export Guide to Ireland

An Economic Gateway to Europe

Despite some concerns about the fate of Ireland in the post-Brexit area, the country is still an attractive market for foreign investors. For years, the government has focused on increasing Ireland’s international competitiveness. The country can now rely on a low corporate tax rate, a young, skilled and multilingual workforce, a transparent judicial system, and pro-business government policies. The clustering effect of existing companies operating successfully in Ireland is also an attractive feature, the country being home to more than a thousand overseas companies, and also to the oldest pub in the world (no surprise to anybody).

The global financial crisis had a significant impact on the country, resulting in austerity measures and high levels of personal debt in some areas, but it also helped lower labour and real estate costs. By encouraging companies with foreign investments to increase their R&D activities, many are now undertaking strategic projects in field such as advanced manufacturing. That probably helps explain why nine of the top ten global companies established in Ireland are operating in software, pharmaceuticals, and ICT sectors.

Ireland is definitely still one of the most attracting countries for high-value foreign direct investment. In this guide, we will guide you through the process of reaching Ireland’s consumers, successfully making sales on ecommerce channels, and getting your products to reach the desired consumers.

Trade Data

Marketing

Digital Marketing

Any merchant, irrespective of the main channel of sales understands that marketing and communications are central to increasing market share. Google’s Consumer Barometer survey (2015) provides some interesting insight into the Irish consumer; including what communication channels they reference before making a purchase decision. Search is obviously the biggest discovery medium, but that might point to di erent sources of insight and research; customer reviews, manufacturer’s websites, price comparison, video and advice sites / blogs.

According to March 2016 data from IAB Ireland, digital ad-spend in the country was worth €263m in 2015, up 34% on the previous year. Of increasing importance, the growth of smartphone usage is driving mobile ad spend, itself up 132% on the previous year and now responsible for a third of total spend in the digital arena. At over €86m this is now a sizeable proportion of the total spend and requiring a different approach to ‘traditional’ digital ad-spend. Size of screen, browsing habits, a ention span and functionality all impact how a mobile advertisement engages with an audience. Display advertising on digital channels has grown by 35% in 2015 and represents 38% of total spend at €99m. The overall performance of display is being driven by the uptake of social media advertising, which lends itself to the format and re ecting users’ increased engagement via social channels. Increasing by 108% in 2015 over its 2014 value, the segment is now worth over €28m.

Digital ad spend in 2015 was worth €263m according to IAB Ireland, up 34% on 2014. The mobile-optimised element of this spend increased by 132% over the same period and now represents over a third of total spending. Social media has incredibly high levels of penetration. 60% of internet users have a Facebook account and 80% of these access it via the app. 79% of account holders access the account daily. Video on Demand is also an area of massive growth while WhatsApp and Snapchat see high levels of engagement. Google search is a key driver of traffic and email marketing plays an important role in driving sales. Voucher usage is popular in the Republic, both for acquisition and retention of customers. Global marketplaces such as Amazon and eBay have a strong presence, including their .co.uk and .com websites. [1]

Shoppers

Irish e-shoppers are con rmed and sophisticated fans of cross-border shopping. A recent Nightline survey of several thousand people concluded that 86% buy – and want to buy more – from retailers based overseas, predominantly in the UK and US. 86% of online shoppers made an international purchase during 2015; creating a market worth €1.5bn and expected to exceed €2bn in 2016. There is more insight as to what consumers are doing online. According to the eir connected living survey 2015, Dubliners are the most likely to shop online, with 64% of the population of the city having done so. Given that 25% of the population of the Republic is Dublin-based this is clearly a primary target market for an incoming retailer. There isn’t much difference between genders and while the 16–49 age group is the most digital, the over 50s shouldn’t be ignored. It is also interesting to note that those shoppers in their late 40s actually appear more likely to shop online than their younger 40s peer group.

All ages of online users are actively engaging with brands but Dubliners are more likely to transact in the channel. Fashion and travel are key sectors and there is a strong desire to shop with international brands; either via their Republic physical presence or an international website.[2]

Social media

Social media is a board and rapidly-changing category covering personal activity, community, communications, text, graphics and video; Irish marketers are looking to make sense of this evolving landscape and planning resources accordingly. Ad-spend by marketers in the Republic has already been shown to be increasing but there is a mixture of views as to what these channels should be used for. According to the latest data available, a 2012 survey by AMAS and the Marketing Institute of Ireland, building relationships (84%) was the biggest driver for merchants to get involved in social activity. Building brand awareness, at 76%, came in second while understanding what customers were saying about brand / products was third at 66%. Interestingly, none of the responses involved selling more product. Indirectly they all have an impact but there was more concern around remaining up-to-date with developments in social media techniques (52%) although understanding customers better was also a key motivator (79%).

Irish consumers are flocking to social media in numbers that make other connected countries look pale by comparison. Facebook is by-far the largest platform at 60% penetration, nearly treble that of Google+. 65% of adults in Northern Ireland regularly use their Facebook account. Users of Facebook are accessing the platform predominantly via mobile devices, at a rate of 80% versus 20% by desktop according to 2016 research by Amárach. Of the Facebook users, 79% access daily and a third of these add an update at least once per day. YouTube usage, at 42% reflects previous gures showing the rapid increase in popularity of VOD and viewing of video clips via mobile devices.

To provide some age-related context, Ipsos MRBI reported in June 2015 that the 15-18 age group in the Republic had a slightly different usage pro le when compared to the overall online adult population. Facebook is still the biggest social network at 94% while Instagram scores strongly at 68% usage and Twitter at 61%. There is a big drop to Google+ which is used by 37% of the group, Tinder by 17% and Pinterest at 14%. These differences are particularly interesting to brands targeting these groups and point to changes in interaction as this generation ages; a brand might not target this group now but they should be aware of the use cases when the users get older and ‘fall’ into the merchants’ customer demographic. Twitter, the messaging service, is currently used by 26% of the online population in the Republic. A third of these users visit at least once per day and 11% add or respond to a comment. Despite the functionality aimed at mobile devices, only 25% of Twitter users access via a smartphone which tends to go against the ‘on-the-move’ use in other territories.

Messaging apps are going from strength-to-strength, particularly amongst younger users; although there is a usage case for older groups. In the Republic, 8% of 35-54 year olds have a Snapchat account, with about 20% using it daily according to Ipsos MRBI in June 2015. This rate increases in the 25-34 year-old segment to 35% having an account; daily usage is up too at 51%. By-far the biggest user group by age is the 15-18s, with a significant 84% having an account and 85% using it daily. In follow-up work in September 2015, Ipsos MRBI were reported by RTE to have found that, across all age groups, Facebook Messenger was the most widely-downloaded app in the Republic, with nearly 50% of adults having an account and half of these using it daily. By contrast, only 22% of adults have a Snapchat account but 68% of those that do use it daily. More adults have downloaded WhatsApp (37%) but more than half of these use it daily.

Social networks are gaining in importance, but users are more likely to refer directly to a brand’s page than access them through ads; perhaps it is peer-input that is more important for product discovery. Amongst all of the other communication mediums, email still ranks strongly, quite possibly due to usage of deal-based content in these channels.

Any merchant, irrespective of the main channel of sales understands that marketing and communications are central to increasing market share. Google’s Consumer Barometer survey (2015) provides some interesting insight into the Irish consumer; including what communication channels they reference before making a purchase decision. Search is obviously the biggest discovery medium, but that might point to di erent sources of insight and research; customer reviews, manufacturer’s websites, price comparison, video and advice sites / blogs.

According to March 2016 data from IAB Ireland, digital ad-spend in the country was worth €263m in 2015, up 34% on the previous year. Of increasing importance, the growth of smartphone usage is driving mobile ad spend, itself up 132% on the previous year and now responsible for a third of total spend in the digital arena. At over €86m this is now a sizeable proportion of the total spend and requiring a different approach to ‘traditional’ digital ad-spend. Size of screen, browsing habits, a ention span and functionality all impact how a mobile advertisement engages with an audience. Display advertising on digital channels has grown by 35% in 2015 and represents 38% of total spend at €99m. The overall performance of display is being driven by the uptake of social media advertising, which lends itself to the format and re ecting users’ increased engagement via social channels. Increasing by 108% in 2015 over its 2014 value, the segment is now worth over €28m.

Digital ad spend in 2015 was worth €263m according to IAB Ireland, up 34% on 2014. The mobile-optimised element of this spend increased by 132% over the same period and now represents over a third of total spending. Social media has incredibly high levels of penetration. 60% of internet users have a Facebook account and 80% of these access it via the app. 79% of account holders access the account daily. Video on Demand is also an area of massive growth while WhatsApp and Snapchat see high levels of engagement. Google search is a key driver of traffic and email marketing plays an important role in driving sales. Voucher usage is popular in the Republic, both for acquisition and retention of customers. Global marketplaces such as Amazon and eBay have a strong presence, including their .co.uk and .com websites. [3]

Email Marketing

Although more up-to-date data isn’t widely available, research by Bluecast Digital in 2012 re ects behaviours seen in other markets. Personalisation is gaining momentum, with just over a third of Irish merchants not offering some level in the marketing emails they are sending out. It would be expected that more up-to-date data would show this figure falling further and the sophistication of personalisation increasing. Open rates in the Republic are also encouraging, with only a quarter of merchants seeing levels at less than 10%. The all-important click-through is promising, with nearly half of merchants achieving levels of 11% or more. 13% of merchants surveyed had rates higher than 21%, indicating that campaign planning and techniques are paying dividends to those investing time and effort in their implementation. The increase in social media usage is also being noticed by email marketers, with increasing numbers including social elements in their campaigns. This might be as simple as a ‘share’ button which helps disseminate campaign messages to friends or more closely-integrated campaigns which include elements of social media, links to product pages and encouraging ‘likes’ for products or brands.

It is important to note that different verticals will see varying results, as will SMEs versus well-known brands. However, Wolfgang Digital reported in January 2016 that email delivered 10%+ of total website traffic and 10% of total revenue. Email is still a key business driver and consumers in the Republic are just as likely as their international cousins to respond to well-cra ed campaigns.[4]

Major Shopping Categories

Books, DVDs, CDs and PC games, clothing and health & beauty are the top categories for cross-border purchasing. The former category is dominated by Amazon while European fashions brands have a strong physical and digital presence in the Republic. Computing and hardware is another major category while there are a number of other significant sectors which are smaller but offer some insight as to local availability. Obviously, the proximity of the UK provides a natural shopping resource for the Irish consumer, although other territories such as the US and Germany have a strong in uence and products suited to market requirements.

With regards to what Irish consumers are buying online, travel is the biggest sector, especially when all forms of travel-related spending are taken into account. For example, flights (70%), hotel bookings (66%) and car hire (21%) are the main categories for those online users who have made a purchase. However, fashion products (which includes clothing and shoes) have been purchased online by 69% of online users. This behaviour mirrors that of other advanced ecommerce markets while electricals have been purchased online by less than a quarter of users. This is a surprise as in many, early adopter markets, electricals drove online growth and have only recently been equalled or surpassed by fashion spending. This may be an indication that, domestically in the Republic, the choice of fashion brands may not be sufficient to meet consumer demand.

Some of the sectors achieving less penetration online include furniture and computer games. Only 6% of online users have made an ecommerce furniture purchase and nearly a third have said they never will. 18% of the group have made online purchases of computer games while 15% say they never will. This does leave a large potential market but computer gamers are generally seen as more accepting of online purchasing, particularly as many games are now streamed from online servers.

One final point of interest is the 30% of online users who will never buy groceries. This isn’t uncommon in many markets as the ability to see and choose fresh produce often outweighs time-saving benefits on the packaged products and dry goods. With 12% already buying online and 58% remaining to be convinced, there is still a lot of potential in this sector. Analysis of the top online shopping destinations shows some interesting insights. All of the brands in the top 20 are international; some with local domain names but most without. [5]

Top 20 Shopping websites 1 Amazon.co.uk 2 Amazon.com 3 Aliexpress.com 4 Argos.ie 5 Asos.com 6 Sportsdirect.com 7 Li lewoodsireland.ie 8 Alibaba.com 9 Ikea.com 10 Lidl.ie 11 Amazon.de 12 Etsy.com 13 Allegro.pl 14 Aldi.ie 15 Debenhams.ie 16 Boohoo.com 17 Tescomobile.ie 18 Nextdirect.com 19 Smythstoys.com 20 Woodiesdiy.com [6]

Major Retail Holidays

December 8 has become a traditional shopping day in Ireland. The so-called ‘Culchie Shopping Day’ emerged for a number of reasons – mostly because it’s a holy day in the Catholic Church calendar. Unfortunately the boom in online shopping and the taking on of the American tradition of Black Friday means special December 8 deals are a thing of the past. While most stores used to offer discounts on the big day, now Black Friday and Cyber Monday have taken over. [7]

Sources

  1. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  2. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  3. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  4. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  5. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  6. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  7.  Irish Mirror “Irish Mirror”

eCommerce & Technology

A Strong eCommerce Market

Increased household internet access (82%) has seen Irish online retailing activity grow to $5.8 billion during 2015 – an increase of 15% from 2014. Over 40% of Irish consumers shop online, compared with just 14% back in 2004. Travel, hotel accommodation and event ticketing are the principal goods and services bought online.

More Irish firms are creating online sales portals on the back of successful online activities of firms such as Aer Lingus, Ryanair, and Ticketmaster.  Retail Ireland’s Online Retailing Survey 2013 reports that 84% of retailers have an online presence while 64% intend to upgrade their presence in the next 18 months.  The majority of retailers also advertise on social media channels such as Facebook and Twitter and over 50% have plans to focus on smartphone applications and tablet technology.  U.S. companies such as Google, Facebook, LinkedIn, eBay, PayPal, Yahoo and Amazon have all established significant operations in Ireland.

According to EuroMonitor International, internet retailing in Ireland continues to expand rapidly with mobile internet retailing becoming especially significant.  Retailers are launching fully-functional mobile apps while store-based retailers are increasingly utilizing multi-channel options. Click-&-collect services have become more widely available, allowing retailers to maximize retail potential without incurring delivery fees, while the consumer has almost immediate access to purchases without having to plan for deliveries.[1]

Domestic and Preferred Card Schemes

Online payments in the Republic are predominantly card-based, with Visa having the largest market share at 65%. PayPal is also a major player with 20% usage. Card Not Present (CNP) fraud grew at a modest 3% in 2013, less than the growth in online transactions. 3D Secure is in operation and any merchant handling payment card data must conform to PCIDSS rules. [2]

Mobile Appetite

Mobile devices now account for 56% of traffic to websites but desktop is still a key element of the customer experience and journey. There are also indications that smartphones are becoming increasingly important for the consumer, with traffic from these devices up by 10% in 2015. 39% of Irish online consumers are now using smartphones to inform their purchase decisions. The majority of Irish retail websites are mobile-optimised while less than half are mobile responsive.

Wolfgang Digital, in their Q4 2015 ecommerce Report looked at the devices used for accessing transactional websites. In 2014, the dominant device was desktop which was responsible for 54% of traffic. In 2015, smartphones had increased by 10% to 39% of all traffic. As tablet had stayed at 17% and desktop had fallen by 10%, it is reasonable to assume that smartphones are becoming much more important in the multichannel journey. This isn’t to say that only retailers with stores and websites are gaining, although there is an obvious benefit for them – consumers are taking smartphones with them to combine offline and online research and then making the purchase in the appropriate channel. [2]

Combined, mobile devices now outstrip desktop in terms of total traffic at 56% versus 44%. This doesn’t take into account the channel via which the final transaction takes place and it is highly likely that desktop devices will still be responsible for the majority of transactions. The role of smartphones is further highlighted in the Consumer Barometer 2015 data, which shows that 38% of users utilise the devices for product discovery while 27% use the functionality to access more information about a product; prices, features and availability.

The data also highlights the importance of a mobile-optimised experience with a quarter of users saying that issues would encourage them to go to another website. The Irish market sees over 30% of internet traffic going via smartphones; over a third higher than the EU28 average and ahead of both the US and UK markets. This is reflected in device penetration where, according to the Consumer Barometer 2015, 75% of the adult Irish population use a smartphone. In parallel to other surveys showing that VOD is growing in the Republic, Statcounter report that over half use their smartphones daily to access video. According to Ofcom, 63% of adults in Northern Ireland have smartphones and 54% of households have access to a tablet. 60% of mobile device owners have transacted via their devices. On smartphones, Android devices are ahead of Apple in terms of accessing apps and while the same is true for tablets, the difference is smaller.

PayPal’s insight also suggests that m-commerce was worth €1.4bn in 2015, up 65% on the previous year and that m-commerce in the Republic will have doubled by the end of 2017 to €2.7bn

Customer Experience

A core element of trust and confidence for many consumers is that of personal data – how it is used, disseminated, protected and controlled. All age groups are concerned but for those aged 35-49 particularly so; probably as a result of witnessing the development of online first-hand and having enough awareness to be able to understand the difference that having data in the digital space means versus the ‘old’ technologies. How companies process and share personal data is also of concern to this group, as it the sheer volume of personal data being held online. The more social media-conscious 16-24 age group is understandably concerned with how their data might be shared on the social media platforms, particularly where they don’t want it shared widely. [3]

Payments Regulation

The European Central Bank Fraud Report showed that the Republic suffered from some of the highest CNP fraud levels in the EU but, amongst its peer group, had the lowest levels of growth. By comparison however, as a proportion of transactions, overall fraud grew at an alarming 23%; probably as a result of the rapid increase seen in overall payments being processed. On the CNP front, the UK and Irish markets have been pushing counter-fraud tools such as 3D Secure and this has probably had an impact on the growth of CNP fraud. This data doesn’t show that the biggest growth areas for CNP fraud have actually been Mail Or Telephone Order (MOTO).

Payment Card Industry Data Security Scheme (PCIDSS) also places emphasis and responsibilities onto organisations that hold and process payment card data. This is an evolving and international standard that the card schemes and acquiring banks will enforce to ensure that payment data is protected as much as practically possible. Another element helping to combat fraud in the Republic has been the introduction of postal codes and a wider awareness amongst both businesses and consumers. Businesses trading into the Republic should ensure they have suitable counter-fraud tools in place and look to their payment service provider for advice on se ing rules and managing the risk. [4]

Mobile payments

Irish consumers have embraced this technology with more than 78% of them manage their money or make payments using a smartphone according to a recent report from Visa Europe. Furthermore this type of usage most certainly correlates with the increase adoption of contactless technology among credit and debit card users. Activities such as these have catapulted Ireland to 8th place in Europe for the highest proportion of mobile payments users, even though mobile payment services such as Apple pay have yet to be launched. This bodes well for when the likes of Apple, Google and Samsung decide to bring their services to the Irish consumer as they’ll certainly be eager to try this way of payment. [4]

Security

Lack of trust of foreign sites, concerns around returns / refunds and a perceived lack of need are the main reasons holding Irish consumers back from online cross-border shopping. Data protection is a key concern, particularly in the 16-24 age group and international merchants would be well advised to take these concerns into account across all age groups, especially when collecting information for marketing purposes. There is a strong consumer protection ethos in the country with ECC-Net having a presence and a powerful Competition and Consumer Protection Commission all having a role in helping consumers and business.

All organisations that are responsible for processing personal data (data controllers) have to comply with eight data protection principles set out in the DPA. Personal data is information relating to a living individual who can be identified from that information or from that information and other information in the data controller’s possession, or from other information that is likely to come into the data controller’s possession – essentially, it is information about a living identifiable individual and includes a person’s name, address, contact details and bank details. Personal data also includes any expression of opinion about the individual and any indication of the data controller’s intentions or any other person’s intentions in respect of the individual. In summary the eight data protection principles require that:

  1. Personal data must be processed fairly and lawfully
  2. Personal data must be obtained only for one or more specified and lawful purposes, and should not be processed in any manner incompatible with that purpose or those purposes
  3. Personal data should be adequate, relevant and not excessive in relation to the purpose or purposes for which they are processed
  4. Personal data should be accurate and, where necessary, kept up to date
  5. Personal data processed for any purpose or purposes should not be kept for longer than is necessary for that purpose or those purposes
  6. Personal data should be processed in accordance with the rights of data subjects under the DPA
  7. Appropriate technical and organisational security measures should be taken against unauthorised or unlawful processing of personal data and against accidental loss or destruction of, or damage to, personal data; and
  8. Personal data should not be transferred to a country or territory outside the European Economic Area unless that country or territory ensures an adequate level of protection for personal data or an exemption applies.

There is stronger legal protection for “sensitive personal data”. Sensitive personal data means personal data consisting of information about an individual’s racial or ethnic origin, political opinions, religious or similar beliefs, trade union membership, physical or mental health or condition, sexual life, or commission of or proceedings for any offense committed or alleged to have been committed by the individual and the outcome of such proceedings. Failure to comply with these obligations can result in a criminal prosecution with fines of up to €5,000 and on indictment €250,000 per offense. A code of practice pertaining to handling data breaches is provided by the ODPC on their website.[5]

Sources

  1. Export.gov “Ireland – eCommerce”
  2. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  3. Ecommerce Worldwide “Customer Experience – Ireland”
  4. Puca.com  “The Current State of Mobile Payments in Ireland”
  5. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”

Shipping & Logistics

A Logistics Infrastructure on Par with Europe

The Republic has 2.2 million residential and business addresses and a population of 4.6 million spread across an area of 70,000 sq km and 10 major conurbations. Over a fifth of these consumers reside in Dublin but much of the population lives in rural and semi-rural locations. That said, delivery to these customers presents no significant logistical challenges and fulfillment of online orders has been recently expedited by the introduction of postal codes unique to each address. Most major international carriers service the country while companies like Nightline can integrate both locally and internationally. Click & collect is increasing in popularity as are parcel lockers such as Parcel Motel. Northern Ireland adds another 1.8 million customers to the overall Irish market who, while politically part of the UK, can often be served by the same logistics solutions as in the Republic.

At the beginning of 2016, the World Bank ranked the Republic as 17th for ease of doing business; out of 189 countries. The Republic’s top trading partners are:

  • Exports: US (21%), UK (16%), Belgium (14%) and Germany (7%)
  • The British Irish Chamber of Commerce estimates trade at €60bn in 2016 – over €1bn per week, and their goal is to see €100bn per annum
  • Imports: UK (39%), US (10%), Germany (8.5%) and Netherlands (6%)

The country’s economy is driven largely by foreign direct investment, a well-educated workforce and a government keen to reduce its borrowing deficit. Key industries include technology, financial services, pharmaceuticals, engineering and clean technology. The UK, being the closest country geographically, is a strong trading partner while the influence of global, US technology brands impact the import / export figures. A large proportion of the population live in rural areas, including smaller towns and villages. The capital city, Dublin, is by-far the largest conurbation with over 1 million inhabitants.

Direct delivery tariffs might class shipments bound for the Emerald Isle as ‘International’ but Nightline strive to deliver at UK domestic rates and consumers demand the same level of service offered to their UK counterparts. They want the same breadth of produce, the same convenience, cost and speed of delivery and the same ease in returning unwanted purchases. Our UK retail partners, including the majority of the UK’s top 20 brands, have realised that not being able to offer comparable standards at the checkout increases the prospect of cart abandonment. They have tapped into the appeal of Parcel Motel, our nationwide parcel locker system. A unique proposition in Ireland, it has almost 250,000 regular users – the top 10% of Irish consumers – and is capable of handling low-cost deliveries and returns. Using a ‘Virtual Address’, which is driving rapidly- rising volumes of ecommerce purchases to customers in the Republic through our Belfast depot, retailers have already seen the clear benefits of catering to a consumer audience whose vast appetite is growing at a rate even faster than the UK. Next day delivery throughout Ireland is now a reality for retailers with fulfillment operations in the UK and the overheads for penetrating the Irish market can be further reduced by a direct collection and injection into the Nightline network. The barriers to entering Ireland are coming down. [1]

Infrastructure

Ireland, as an island, consists of two separate but conjoined market opportunities and countries – the Republic of Ireland (‘the Republic’) and Northern Ireland. The Republic has a population of over 4.6 million and a GDP per capita of nearly $49,000 in 2014; the fourth-highest of any member state of the European Union (EU). Most of the population speak English and 30% speak Irish Gaelic. Tourism is a key part of the economy with over 8 million tourists visiting every year; more than double the population of the country. Three international airports and membership of the EU have established the Republic as an active participant in cross-border trade across the EU, Northern Ireland and further afield. The main import markets are the United Kingdom (UK – 39%), United States of America (US – 10%), Germany (8.5%) and Netherlands (6%).

Northern Ireland, while being politically and economically part of the UK, is geographically closer to the Republic, sharing a common border and heritage. While this report focuses on the Republic, cross-border trade is an important way of life for the communities both sides of the border. As such, it is important for any merchant looking to trade into the Republic to understand the differences as well as the opportunities. Where appropriate, specific insight in to the Northern Ireland market will be highlighted, while more in-depth information is available from the UK passport which can be found at ecommerceworldwide.com. For example, Northern Ireland is the only part of the UK to share a physical land border with the EU.

Northern Ireland has a population of over 1.8 million while the provincial capital, Belfast, contains over 330,000 inhabitants. In the Republic, Dublin represents the single largest conurbation and concentration of people in the country. With over 1 million citizens residing in the capital’s region, it o ers merchants the biggest market while the second largest area (Cork) is notably smaller at around 190,000 inhabitants. With a considerable proportion of the population in rural areas, good road links are important and the country is well provided for in this area. [2]

Post

In Northern Ireland, Royal Mail will provide delivery services as part of its UK universal service obligation. In the Republic, using An Post as the final delivery agent, retailers will be able to access services through their own domestic postal providers. From the UK for example, Royal Mail provides the following service options (example – small parcel weighing 500 grams and valued under £50):

  • Royal Mail International Tracked and Signed – 3 to 5 days’ delivery – delivery conformation and limited compensation
  • Royal Mail International Tracked – 3 to 5 days’ delivery – delivery conformation and limited compensation
  • Parcelforce Worldwide irelandexpress – 1 day guaranteed – tracked and higher level compensation
  • Parcelforce Worldwide global express – from 1 day guaranteed – tracked and higher level compensation
  • Parcelforce Worldwide global priority – 3 days’ delivery – tracked and higher level compensation
  • Parcelforce Worldwide global value – 3-5 days’ delivery aim – not tracked but with higher level compensation UK retailers and Republic shoppers buying from UK retailers have some additional options through the postal route (see sections – Direct access and Virtual address).

Global Carriers

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

UPS – Offers a range of services and delivery times to Ireland subject to country of origin and the specific destination:

  • UPS Express Plus – next business day – delivery by 09:00
  • UPS Express – next business day – delivery typically by 10:30 noon or by 12:00
  • UPS Express Saver – delivery by end of next business day
  • UPS Expedited – 2-5 business days – delivery by end of day
  • UPS Standard – day de nite by date scheduled – delivery during the day (UK 2 days)

The example service times above are from the UK where all the services are available except UPS Expedited. UPS services are designed for business deliveries and the service times shown are for delivery to business areas. Residential / rural areas may take a little longer and residential delivery services may incur a surcharge. For residential deliveries UPS does offer a click & collect solution, Access Points, where shoppers can collect their orders. However, UPS has yet to extend its network to Ireland. For Northern Ireland services will be similar although UPS will treat this as part of the UK.

Fed Ex Offers two main services to Ireland for ecommerce orders with delivery times subject to country of origin and the specific destination. These are:

  • International Priority – typically 2 working days to European cities and 3 working days to other addresses
  • International Economy – typically within 5 working days

For Northern Ireland services will be similar although Fed Ex will treat this as part of the UK.

DHL Offers four service options to Ireland:

  • Export Express – 09:00 delivery the next possible working day
  • Export Express – 12:00 delivery the next possible working day
  • Export Express Worldwide – Guaranteed delivery by the end of the next possible working day
  • Export Economy Select

For ecommerce deliveries it is likely that the most viable option will be Export Economy Select where, by example, delivery from the UK will be 2 working days. For Northern Ireland services will be similar although DHL will treat this as part of the UK.

TNT Offers international services to Ireland including time and day-de ned, express and economy subject to country of origin and the specific destination. From the UK for example, service options include next-day by 09:00, by 10:00, by 12:00, and close of business. However, the most viable option for ecommerce parcels is likely to be economy express which provides a 2-day delivery from the UK. For Northern Ireland services will be similar although TNT will treat this as part of the UK.

DPD Offers two main international services with transit times dependent on the origin of the shipments:

  • DPD Air Classic – typically o ering global delivery in between 3 to 10 days
  • DPD Express – typically o ering global delivery in between 2 to 8 days [3]

For Northern Ireland services will be similar although UPS will treat this as part of the UK. Retailers nearer to Ireland, such as in the UK,will have access to more services as DPD treats this destination as an offshore extension to its domestic services (see section – Domestic carriers). 

Domestic Carriers

Royal Mail (see section – Post)

Hermes will deliver to Ireland in 3 to 5 days.

Yodel offers a 2-day or 3-day delivery to Ireland.

DPD • 2 days’ delivery to the Republic in general but 12:00, next-day and 2-day options for Dublin • DPD also runs a direct access service – DPD Direct – which can offer delivery in 3 to 4 days (see section – Direct access). [4]

Although UK domestic carriers will treat Northern Ireland as part of the UK, there may be additional time and costs incurred in moving goods from the mainland UK. As a result there may be some extension to delivery times and some carriers may treat Northern Ireland as an ‘exception area’ applying surcharges. 

Parcel brokers

Parcel brokers provide smaller retailers with a way of accessing be er pre-contract rates through postal operators, global and domestic carriers and direct access providers. Parcel brokers do not offer all carrier options, only those that choose to contract with them, but in the UK for example companies such as Parcel2Go and Parcel Monkey provide this channel into Ireland using the likes of Nightline, TNT, DPD, Asendia, UPS, Hermes, Parcelforce and others. [5]

Integrators

Retailers with a reasonable volume of orders going to Ireland may wish to consider the option of parcel management service integrators who can provide immediate integration with a wide range of service providers delivering into the Irish market. These will include most of the options above (excluding parcel brokers) and many others. The retailer will need to have or enter into a contract with the delivery service provider but then the integrator will offer the ability to allocate orders to the most appropriate service – using agreed business rules – printing labels and customs documentation, providing tracking and helping to manage returns. For smaller retailers some integrators offer their own parcel broker option that can help obtain be er rates. Providers of such services include MetaPack, ITinSell, Consignor and Electio. [6]

In-country fulfillment

Should a cross-border retailer generate sufficient orders to fulfill those orders ‘in-country’, local operators such as Nightline and DPD provide full warehousing facilities. [7]

Customs & Clearance

The question of custom duties and taxation is covered earlier in this passport but needs to be referenced under the heading of logistics because any error can clearly delay clearance and delivery to the customer. 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 Ireland. Retailers are therefore advised to specifically ask what their chosen delivery partner can do to facilitate customs clearance and duty calculation / collection. Of course as a member of the EU dispatches from within the EU to Ireland will not be subject to customs clearance. [8]

Packaging

E-retailers looking to enter the Irish market should be aware of the various packaging requirements needed for products crossing the border, though depending on the specific goods being exported, these requirements can vary greatly and, depending on the industry, regulations are o en administered and enforced by different government bodies. When contemplating packaging rules and standards, retailers should refer to the packaging regulations specific to their industry. [9]

Delivery in Ireland

Any retailer wishing to compete for Irish consumers’ attention needs to appreciate the delivery services provided to them by domestic Irish retailers because these will provide direct competition. Delivery services available to Northern Ireland are the same as those provided within the UK but with some additions provided by local carriers e.g. Nightline. Specifically, delivery within the Republic is mainly provided by the following companies:

Nightline – Northern Ireland and the Republic of Ireland With a network of 12 depots, Nightline provides services in both Northern Ireland and the Republic.

  • Nightline Delivers – a fully tracked next-day delivery service throughout Ireland
  • All Ireland next-day distribution through Tapa ‘A’ and GDP certi ed network
  • Parcel Pilot – retailer-branded pre- ight and in- ight noti cations with an expected 2-hour delivery window providing the option to change the date, address and method of delivery (Parcel Motel locker pick-up / collect from depot) throughout the journey
  • Premium service – Same day, timed, evening and weekend delivery options
  • Parcel Motel – the only nationwide locker terminal network offering remote, secure pick-up via retailer API (see section – Click & collect)

An Post

  • Standard Post – Next-day delivery within the Republic with tracking available
  • Registered Post – Next-day delivery within the Republic, with tracking and signature on delivery. Insurance up to €320 with additional insurance options available.
  • Express Post – Guaranteed next working day delivery within the Republic, with or without signature on delivery and insurance up to €350.
  • Post Alerts – Provides email and / or SMS updates at key points within the delivery cycle of an item with express with signature service.
  • Re-delivery – An Post o er a free re-delivery service to the same address or delivery to a neighbour, Post Office, Delivery Office or PostPoint location, should they be unable to effect first time delivery. DPD Ireland
  • DPD Premium – a next-day, tracked service throughout Ireland • Saturdaydeliveryoption
  • Pre-booked timed delivery option
  • Cheque On Delivery
  • Predict – a pre-delivery alert to the consumer on the morning of delivery advising an expected one-hour delivery window with the option to defer to a later date
  • SwapIt – the ability to exchange products when a delivery is made

Fastway Couriers • A franchised courier network serving Ireland Any overseas retailer must consider their delivery o er against the context of this service landscape because, as se ing the competition benchmark with local retailers, this in uences the needs and expectations of Republic consumers.

Virtual Address In Ireland shoppers are able to take an additional degree of control when it comes to which cross-border retailers they buy from, using virtual address services. This is a service mainly used for purchases from the UK, where the retailer they want to buy from does not offer a delivery option for Ireland. The shopper can register and be assigned a virtual delivery address which is a consolidation point in the UK. The carrier then arranges to bring the consolidated orders to Ireland to be delivered to a designated location. Services available to Republic shoppers are currently:

  1. Parcel Motel – The shopper pays the retailer’s UK delivery charge (if any) plus an additional charge (currently €3.95) to Nightline and the order is taken to their nominated Parcel Motel locker location. They are notified by email / SMS that the parcel is ready for collection from when they have 48 hours to collect.
  2. An Post Address Pal – The shopper pays the retailer’s UK delivery charge (if any) for delivery to An Post’s AddressPal address on the UK mainland. An Post will then have the item made available for collection from the customer’s nominated Post Office for a fee of €3.50.
  3. Parcel Connect – The shopper pays the retailer’s UK delivery charge (if any) plus an additional charge (currently €4.50) to Parcel Connect and the order is taken to a Parcel Connect parcel shop for collection by the customer who is advised by SMS

Click and Collect Ireland As with many other markets, Ireland is starting to adopt click & collect as a means for providing an alternative delivery channel to shoppers. For Irish domestic retailers or UK retailers with stores in the Republic, in-store click & collect is of course an option but this is not so for importing retailers. Third party click & collect networks are starting to emerge:

  • Parcel Motel (parcelmotel.com)
  • 9,280 lockers in 116 consumer accessible locations
  • Available 24/7/365
  • 250,000 registered Irish consumers
  • Can be o ered as an alternative delivery option for shoppers who may want to collect rather than have home delivery
  • Can be used in conjunction with a UK virtual delivery address for retailers not serving Ireland directly
  • Can be used for returns for UK-based retailers.
  • Parcel Connect • A network of Parcelshops served by Castaway Couriers
  • An Post MyParcel PickUp
  • A new delivery option provided through the PostPoint network in Ireland
  • Consumers are contacted by the An Post delivery agent and provided with the free option to have their parcels diverted to a PostPoint (local store) rather than have delivery to their home The service is available through all Post Office and Postpoint locations with the Republic. [10]

Returns

European consumers have a statutory right to return goods within 14 days which means that as well as it being good practice to provide a transparent and e cient returns solution, there is a legal imperative too. As we have already seen, 22% of Irish consumers are put off from shopping cross-border because they assume returns will be difficult or costly so when selecting their delivery partner for Ireland, retailers should find out what arrangements they can make for returns.

Republic consumers will need and expect:

  • A simple and transparent returns process
  • A convenient way to drop-off the parcel or have it collected
  • To be kept informed on the progress of their return
  • Be advised when their refund is being made, possibly including duty repatriation

For Ireland cross-border retailers can arrange for returns to be sent back to the country of origin (where it can be delivered back to the originating retailer to be processed) through the postal route or a carrier. Nightline for example offers road and air services with daily departures to Europe and beyond and with local partner and distribution arrangements in France, Spain, Holland, Belgium, Germany, Italy, Austria, Slovakia, Czech Republic, Norway, Sweden, Denmark and Finland. For the UK, Nightline also o ers retailers the facility to offer free, pre-paid or paid-for returns through its Parcel Motel network, where the customer can drop the parcel off and from where it is tracked back to the retailer. Parcel Motel also caters for Collect+ returns through its nationwide locker network.

Another option for reducing the lead time between the item being sent and being available for re-sale / disposal and customer credit, is for the return to be processed ‘in-country’. Some operators now provide local processing centres where the return can be locally validated, quality controlled and the refund issued. This allows orders to be consolidated for return to stock, disposal or even, when there is su cient demand, for the goods to be retained in Ireland and used to fulfill another Irish order. Nightline Logistics provides such a capability through its high security and DPD also offers reverse logistics. To help retailers manage the returns process these same operators are developing white label / multilingual returns portals matching up the original order with the return.

Such portals make it is easier for the customer to make returns, offering multiple payment options such as customer or retailer paid. The customer can print the label, see when a return has been received and when their refund is due.Operators providing such services for the cross-border market include wnDirect and ReBound. Parcel Motel offers speci c landing pages for its retailer partners to facilitate label printing and returns and provides this service for a number of UK retailers. [11]

Import Duties

The majority of consumer products fall into the VAT rate of 23%. Books, Children’s clothing and educational products are zero rated at 0%. Non-established suppliers supplying taxable goods or services in the State are generally obliged to register and account for Irish VAT. The turnover thresholds for VAT registration which apply to Irish suppliers do not apply and non established suppliers must register for Irish VAT regardless of the level of their turnover. Where the value of distance sales to the State (Ireland) by a supplier in another EU Member State exceeds €35,000 in a calendar year that supplier must register for VAT in the State and must account for VAT at the appropriate Irish rates. If the threshold is not exceeded, the supplier may opt to register and account for VAT in the State on his or her distance sales. Non-established suppliers making distance sales of excisable goods (spirits, tobacco etc.) to the State are obliged to register for VAT in the State irrespective of the level of turnover. (source: www.revenue.ie) VAT and Duties is a complex area and merchants are advised to seek professional advice on this area and can gain more information from the Irish Tax and Customs Service at www.revenue.ie [12]

Sources

  1. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  2. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  3. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  4. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  5. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  6. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  7. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  8. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  9. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  10. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  11. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”
  12. eCommerce Worldwide. Ireland Country Guide. “eCommerce in Ireland”