Selling online in the UK [infographic & useful fact sheet]
The UK ecommerce market has huge buying power and excellent digital infrastructure. The country has a high population density and percentage of online GDP.
Brexit may have started off with a period of disruption. However, the UK is a strong economy with a strong digital landscape and it’s likely to stay at the forefront of ecommerce worldwide.
- Facts about the UK marketplace: online buyer behavior, popular categories, delivery & shipping, online payment methods, impact of Brexit on ecommerce, etc.
- Benefits of selling your product online in the UK
- Finally: check out our comprehensive infographic at the end of the article.
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The ecommerce market in the UK is competitive and customer-oriented. According to many analysts, ecommerce now accounts for more than 1/4 of all retail sales in the UK and is expected to reach nearly 1/3 of all retail sales by 2024.
Worth over £220 billion, the UK is considered to be the third biggest ecommerce market globally. Last year, UK businesses saw a 57% increase in worldwide ecommerce sales.
UK ecommerce: facts & numbers
- Population: 68,207,116
- Language: English
- Currency: British Pound (GBP)
- Internet users: 65,001,016
- Internet penetration: 98.22%
- Internet growth 2000-2020: 413%
- Smartphone penetration: 82.9%
- Digital buyers: 45.4 million
- Online sales: €222 billion (2020)
- Forecasted ecommerce revenue for 2025: 119.1 billion USD
- Digital commerce growth (Q2 2021, UK): 17%
- Conversion rate: 3.5%
- Shopper spend (the per-visit average amount spent by shoppers): USD 2.88
- Average Order Value (AOV, the order amount spent by the shopper): USD 66.
According to Statista, in the UK ecommerce market:
- Revenue is expected to show an annual growth rate (CAGR 2021-2025) of 3.47%, resulting in a projected market volume of £92,461 million by 2025.
- The largest segment is Fashion with a projected market volume of £27,059 million in 2021.
- The number of users is expected to amount to 62.1m users by 2025.
The UK: top ecommerce sites
- Amazon UK
- eBay UK
The UK: popular ecommerce categories
- Clothes, shoes & accessories
- Furniture, home accessories or gardening products
- Computers, tablets, mobile phones or accessories
- Toys and childcare items
- Cosmetics, beauty or wellness products.
Ecommerce in the UK: online buyer behaviour
Online shopping has become a daily norm for millions of UK consumers who have great expectations when it comes to customer and user experience, delivery speed and smooth returns procedures.
The chart below illustrates changes in shopper spend in the UK quarter by quarter between Q1 2019 and Q2 2021.
The UK is a competitive and customer-focused market. British buyers can be pretty demanding when it comes to customer service. For this reason, online sellers should strive to provide quality customer service and instil confidence in their clients. This can be achieved through customer-oriented actions, for example by ensuring hassle-free returns.
Customer expectations in the UK include:
- Clear & accurate online tracking and notifications with delivery status
- Efficient & proactive communication
- Retailers with a proactive approach to following up problems.
Ecommerce in the UK: delivery, shipping & payment methods
The UK infrastructure is comprehensive, efficient and modern. The need for efficiency has resulted in low pricing for deliveries.
The UK’s compact size has its benefits compared with bigger countries, such as Russia, the USA or Australia, where you can expect longer delivery times.
In the UK next day deliveries are commonplace. Shopping online feels almost as immediate as shopping in-store. This is extra important to consider after Brexit has become reality and moving goods across the EU-UK border has become less straightforward.
The UK: top delivery companies for ecommerce
- Royal Mail
- Parcelforce Worldwide
Finally, it’s important to provide your (potential) customers with payment methods of their preference.
The UK: top payment methods in ecommerce
- Debit and credit cards
- Digital wallets, e.g. PayPal
- Bank transfers.
Ecommerce in the UK: mobile commerce
In the UK, 2020 was the biggest mobile shopping year to date. Consumers spent collectively 82 billion hours in shopping apps (30% up from 2019). Popular retail apps in the UK included Amazon and Tesco Groceries.
Check the charts below to better understand UK traffic and order growth as well as traffic share by device.
Shopping from a mobile device is fuelling the growth of ecommerce in the UK. Thus, ensuring a great mobile buying experience should be on online sellers’ priority lists.
Cross-border shopping in the UK & Brexit
The UK ecommerce market imports and exports heavily. The most intensive B2C ecommerce trade between the UK and the USA is the result of the common linguistic background.
The UK also trades with the EU (e.g. Germany, France or Netherlands), China and some other Asian countries (e.g. UAE or Hong Kong).
As to the impact of Brexit on UK businesses (especially in ecommerce), exports to the EU plunged 68% in the month after Brexit (Road Haulage Association).
The necessity to pay VAT and complete customs declarations have made the UK-EU trade less straightforward and less cost-efficient.
As a result, some UK ecommerce brands have stopped selling to the EU as it’s no longer financially viable. Similarly, many small ecommerce businesses located in the EU have stopped selling to their UK-based customers.
The initial disruption at the begininng of 2021 doesn’t show the whole picture of what the post-Brexit ecommerce reality may look like.
In fact, it’s still too early to assess the full impact of Brexit on ecommerce since we need concrete data for a longer period of time. While Brexit equals temporary disruptions, in the long term it may not turn out to be a massive blow to the ecommerce sector.
The truth is that online shopping both in the UK and the EU is massive and this is unlikely to change any time soon.
As a result, selling in the UK is worth considering: a well thought out international sales strategy should help you overcome the initial hurdle of translating and localizing your listings.
Benefits of selling your product online in the UK
- English language
- The market’s sales potential
- Access to a large number of online shoppers
- Well-developed infrastructure
- Advanced payment culture
- Quick technology adoption among the population
- Online savvy, internationally-minded consumers
- A large number of marketing and communication opportunities.
Ecommerce in the UK: infographic
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