Iceland E-Commerce Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

The Iceland E-Commerce Market Report is Segmented by Business Model (B2C, B2B), Device Type (Smartphone / Mobile, Desktop and Laptop, Other Device Types), Payment Method (Credit / Debit Cards, Digital Wallets, BNPL, Other Payment Method), B2C Product Category (Beauty and Personal Care, Consumer Electronics, Fashion and Apparel, Food and Beverages, and More). The Market Forecasts are Provided in Terms of Value (USD).

Iceland E-commerce Market Size and Share

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Iceland E-commerce Market Analysis by Mordor Intelligence

The Iceland e-commerce market stands at USD1.04 billion in 2025 and is projected to reach USD2.03 billion by 2030, supported by a 14.31% CAGR over the forecast window. Consistent 99.8% internet penetration, the country’s cash-lite payment culture, and a mobile-first shopping mindset underpin this expansion. Robust domestic card turnover, which topped ISK128.5 billion (USD 1.06 billion) in April 2025, confirms the strong consumer appetite for online transactions.[1]Central Bank of Iceland, “Payment Intermediation in April 2025,” cb.is International retailers benefit from a government VAT rebate on low-value imports, yet local merchants counter with Iceland Post’s same-day Reykjavik service and tailored loyalty programs. B2B digital procurement is accelerating as firms pursue efficiency gains, while tourism-fuelled demand for niche Icelandic goods opens cross-border revenue streams. Despite its momentum, the Iceland e-commerce market continues to battle scale constraints, volatile logistics costs, and import duties on non-EEA parcels.  

Key Report Takeaways

  • By business model, the B2C segment led with an 85% Iceland e-commerce market share in 2024; B2B is forecast to grow at a 14.1% CAGR through 2030.  
  • By device type, mobile commerce captured 72% of 2024 sales and is pacing an annual 13.8% rise to 2030.  
  • By payment method, cards secured 51% share of transactions in 2024, while digital wallets are advancing at an 18.2% CAGR.  
  • By product category, Fashion & Apparel dominated with 28% revenue in 2024; Food & Beverages is expanding at a 14.5% CAGR to 2030.  

Segment Analysis

By Business Model: B2B Segment Accelerates Beyond Consumer Market

Iceland e-commerce market for B2C stood at 85% Iceland e-commerce market share in 2024, yet B2B digital trade is predicted to grow 14.1% annually to 2030, surpassing the mainstream channel. Public and private tenders increasingly specify e-procurement, shifting overall purchase cycles online.  

Large hospitality chains now source perishables via integrated portals that reconcile invoices directly with accounting software, compressing payables lead time. Cloud-based marketplaces facilitate cross-dock consolidation, cutting inbound freight charges for small wholesalers. Alignment of VAT rules with EU place-of-supply standards from 2026 is anticipated to streamline compliance and encourage more SMEs to adopt e-procurement.  

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By Device Type: Mobile-First Strategy Reshapes User Experience

Mobile commerce processed 72% of transactions in 2024 and is rising at 13.8% CAGR, underscoring a decisive shift in shopper behavior. Responsive sites with biometric log-ins are now baseline, while in-app push campaigns drive higher order frequency.  

Desktop maintains relevance for complex purchases such as multi-item B2B carts, but conversion lags mobile on fashion and grocery baskets. Wearables and in-car interfaces remain nascent; however, 5G rollout across major routes positions them for future growth. A potential rafkróna CBDC native to mobile wallets could further accelerate mobile checkout penetration.  

By Payment Method: Digital Wallets Disrupt Card Dominance

Cards retained 51% share of 2024 online payments, yet wallet transactions are growing 18.2% each year. Tokenized wallet rails enhance security and support one-tap mobile orders, crucial for impulse purchases.  

Bank transfers serve B2B invoices, while BNPL providers capture millennials seeking budgeting flexibility. The CBDC exploration aims to reduce cross-border fees and settlement delay, potentially lowering merchant service charges and inviting greater small-ticket volume.  

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Note: Segment shares of all individual segments available upon report purchase

By B2C Product Category: Food & Beverages Outpace Traditional Leaders**

Fashion & Apparel generated 28% of 2024 turnover, but Food & Beverages is on track for the fastest 14.5% CAGR. Grocery chains deploy dark-store picking and chilled lockers, raising delivery reliability and basket value.  

Consumer Electronics holds solid rank supported by franchise operator Elko, while Beauty and DIY categories cultivate subscription programs to stabilize demand. Tourists sustain overseas reorder flows for wool and skincare, extending category life-cycle revenue.  

Geography Analysis

Reykjavik accounted for more than 60% of the Iceland e-commerce market in 2024 thanks to population density, 1-day delivery, and the prevalence of digital wallets at checkout. Same-day coverage allows grocers to capture evening meal orders and electronics retailers to promise next-day repairs, cementing loyalty.  

Beyond the capital, the West and North regions show mid-teen growth as logistics routes improve; rural households increasingly rely on online channels for specialty items unavailable locally. Delivery windows of 2-3 days remain acceptable for apparel and books but hinder perishable categories, sparking trials of community freezer hubs.  

Internationally, outbound cross-border sales help local merchants magnify scale. Orders to the EU enjoy duty-free treatment under EEA terms, while shipments to North America rely on air-freight capacity tied to tourism passenger volumes. Conversely, inbound higher-value non-EEA parcels face the ISK10,000 (USD 82.5) duty barrier, moderating average-ticket size yet encouraging frequency of micro-orders.  

Competitive Landscape

The Iceland e-commerce market features a blend of global marketplaces and agile domestic specialists. Amazon and eBay serve cross-border segments, leveraging price breadth; however, local players such as Heimkaup differentiate through curated Icelandic SKUs and next-day delivery promises. Elko’s 2024 revenue rose 2.5% to NOK 47.15 billion (USD 4.5 billion) and the chain scales click-and-collect to keep freight costs predictable.  

Samkaup pioneers online grocery since 2017 and now layers recipe-based baskets to raise unit economics. Fintech startups simplify multi-currency settlement, critical for exporters of niche goods. Meanwhile, the government’s crackdown on unsafe imports from ultralow-cost apps like Temu elevates compliance overhead, benefiting established retailers with documented supply chains.  

Private-equity capital is entering: the EIF’s EUR 30 million (USD 33 million) allocation to Alfa Framtak’s new fund seeks to scale logistics tech and sustainability-oriented SMEs, signaling confidence in the addressable upside. Overall, competition centres on order-to-door speed, payment optionality, and depth of Iceland-branded assortments.  

Iceland E-commerce Industry Leaders

  1. Amazon.com, Inc.

  2. Inter IKEA Systems B.V

  3. Elko ehf

  4. eBay Inc.

  5. ASOS plc

  6. *Disclaimer: Major Players sorted in no particular order
Amazon.com, Inc. Inter IKEA Systems B.V Elko ehf eBay Inc. ASOS.com, Ltd.
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Recent Industry Developments

  • May 2025: The Environment Ministry detailed coordinated Nordic measures to hold payment providers and shippers accountable for non-compliant imports, aiming to level safety standards and protect local merchants.
  • April 2025: The European Investment Fund committed EUR30 million (USD33 million) to Alfa Framtak’s AF3 private-equity vehicle, targeting digital transformation plays including fulfilment automation and cross-border warehousing.
  • March 2025: The IMF Article IV mission projected a 1.3% fiscal deficit and highlighted taxation shifts that could raise last-mile fuel costs, informing merchants’ pricing strategy.
  • February 2025: Íslandsbanki underscored heavy investment in personalised digital services and data infrastructure, strengthening credit pipelines for e-commerce SMEs.

Table of Contents for Iceland E-commerce Industry Report

1. INTRODUCTION

  • 1.1 Study Assumptions and Market Definition
  • 1.2 Scope of the Study

2. RESEARCH METHODOLOGY

3. EXECUTIVE SUMMARY

4. MARKET LANDSCAPE

  • 4.1 Market Overview
  • 4.2 Market Drivers
    • 4.2.1 Hyper-digitised Population with 99% Internet Penetration
    • 4.2.2 Universal Bank-ID Adoption Enabling Frictionless Checkout
    • 4.2.3 Government VAT-rebate on Cross-border Purchases Below ISK 2,000
    • 4.2.4 Iceland Post’s Same-Day Reykjavik Network
    • 4.2.5 Tourism-Driven Demand for Icelandic Niche Goods Online
  • 4.3 Market Restraints
    • 4.3.1 Small Domestic Customer Base Limits Economies of Scale
    • 4.3.2 Volatile Air-freight Costs Owing to Weather and Volcanic Disruptions
    • 4.3.3 High Import Duties on Non-EEA Parcels ≥ ISK 10,000
  • 4.4 Value Chain Analysis
  • 4.5 Regulatory Outlook
  • 4.6 Porter’s Five Forces Analysis
    • 4.6.1 Bargaining Power of Suppliers
    • 4.6.2 Bargaining Power of Buyers
    • 4.6.3 Threat of New Entrants
    • 4.6.4 Threat of Substitutes
    • 4.6.5 Intensity of Competitive Rivalry
  • 4.7 Key Market Trends and Share of E-commerce in Total Retail
  • 4.8 Assessment of Macro Economic Trends on the Market
  • 4.9 Demographic Analysis (Population, Internet, Age, Income)
  • 4.10 Cross-Border E-commerce Size and Trends
  • 4.11 Current Positioning of Iceland in the E-commerce Industry in Europe

5. MARKET SIZE AND GROWTH FORECASTS (VALUES)

  • 5.1 By Business Model
    • 5.1.1 B2C
    • 5.1.2 B2B
  • 5.2 By Device Type
    • 5.2.1 Smartphone / Mobile
    • 5.2.2 Desktop and Laptop
    • 5.2.3 Other Device Types
  • 5.3 By Payment Method
    • 5.3.1 Credit / Debit Cards
    • 5.3.2 Digital Wallets
    • 5.3.3 BNPL
    • 5.3.4 Other Payment Method
  • 5.4 By B2C Product Category
    • 5.4.1 Beauty and Personal Care
    • 5.4.2 Consumer Electronics
    • 5.4.3 Fashion and Apparel
    • 5.4.4 Food and Beverages
    • 5.4.5 Furniture and Home
    • 5.4.6 Toys, DIY and Media
    • 5.4.7 Other Product Categories

6. COMPETITIVE LANDSCAPE

  • 6.1 Market Concentration
  • 6.2 Strategic Moves
  • 6.3 Market Share Analysis
  • 6.4 Company Profiles (includes Global Overview, Market-level Overview, Core Segments, Financials, Strategic Info, Market Rank/Share, Products and Services, Recent Developments)
    • 6.4.1 Amazon.com, Inc.
    • 6.4.2 Inter IKEA Systems B.V.
    • 6.4.3 Elko ehf
    • 6.4.4 eBay Inc.
    • 6.4.5 ASOS plc
    • 6.4.6 Alibaba Group Holding Ltd. (AliExpress)
    • 6.4.7 EPAL ehf.
    • 6.4.8 Heimkaup ehf.
    • 6.4.9 Hópkaup ehf.
    • 6.4.10 Bland ehf.
    • 6.4.11 Lín Design ehf.
    • 6.4.12 Costco Wholesale Corp.
    • 6.4.13 Zara (Isl. Franchise – Inditex S.A.)
    • 6.4.14 Netgíró hf.
    • 6.4.15 Nova hf.
    • 6.4.16 Síminn hf.
    • 6.4.17 Dropp ehf.
    • 6.4.18 Pósturinn

7. MARKET OPPORTUNITIES AND FUTURE OUTLOOK

  • 7.1 White-space and Unmet-Need Assessment
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Iceland E-commerce Market Report Scope

The Iceland e-commerce market is segmented by B2C e-commerce (beauty and personal care, consumer electronics, fashion and apparel, food and beverage, furniture and home), and B2B e-commerce.

By Business Model B2C
B2B
By Device Type Smartphone / Mobile
Desktop and Laptop
Other Device Types
By Payment Method Credit / Debit Cards
Digital Wallets
BNPL
Other Payment Method
By B2C Product Category Beauty and Personal Care
Consumer Electronics
Fashion and Apparel
Food and Beverages
Furniture and Home
Toys, DIY and Media
Other Product Categories
By Business Model
B2C
B2B
By Device Type
Smartphone / Mobile
Desktop and Laptop
Other Device Types
By Payment Method
Credit / Debit Cards
Digital Wallets
BNPL
Other Payment Method
By B2C Product Category
Beauty and Personal Care
Consumer Electronics
Fashion and Apparel
Food and Beverages
Furniture and Home
Toys, DIY and Media
Other Product Categories
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Key Questions Answered in the Report

What is the current size of the Iceland e-commerce market?

It is valued at USD1.04 billion in 2025 and is projected to double to USD2.03 billion by 2030.

Which segment is growing fastest in the Iceland e-commerce market?

B2B digital commerce is expanding at a 14.1% CAGR, outpacing the consumer channel.

How important is mobile shopping in Iceland?

Mobile accounts for 72% of transactions and is still rising at 13.8% annually, making a mobile-first strategy essential.

What payment methods are gaining ground?

Digital wallets are the quickest-growing method, posting an 18.2% CAGR, although cards remain the single largest medium.

How do government policies influence cross-border shopping?

A VAT rebate on imports under ISK 2,000 (USD 16.47) encourages small-value overseas orders, while duties on parcels above ISK 10,000 (USD 82.37) temper larger purchases.

Which product categories present the best growth prospects?

Food & Beverages leads growth at 14.5% CAGR due to improved cold-chain logistics and changing consumer preferences.

Page last updated on: July 7, 2025

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