UK E-commerce Market Size
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| Market Size (2024) | USD 280.55 Billion |
| Market Size (2029) | USD 750.80 Billion |
| CAGR (2024 - 2029) | 21.76 % |
| Market Concentration | Low |
Major Players
*Disclaimer: Major Players sorted in no particular order |
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UK E-commerce Market Analysis
The UK E-commerce Market size is estimated at USD 280.55 billion in 2024, and is expected to reach USD 750.80 billion by 2029, growing at a CAGR of 21.76% during the forecast period (2024-2029).
- E-commerce has experienced significant growth over the past few decades, driven by consumers' increasing preference for online shopping. This trend has been supported by substantial investments from internet-focused enterprises and traditional retailers transitioning to digital platforms. While sales in physical retail stores have stagnated, regional revenues from online shopping have surged dramatically.
- The appeal of online retailing lies in its ability to offer superior value for money. Consumers, particularly those interested in health, fashion, consumer electronics, travel services, and home and garden products, are drawn to the internet for competitive prices and attractive deals.
- In the United Kingdom, heightened awareness of online identity theft has led consumers to prioritize secure financial transactions. Nearly all online businesses in the country now accept credit and debit card payments, with Mastercard and Visa being the most widely accepted, followed by American Express and other cards. Additionally, many websites utilize payment services such as PayPal.
- With the continued rise of social networking and mobile internet access, businesses are expected to increase their investments in e-commerce through social media marketing in the coming years. This trend highlights the stark contrast between the robust growth of online sales and the challenges faced by brick-and-mortar retailers, many of which are filing for bankruptcy or administration.
- The expansion of e-commerce has the potential to intensify competition in retail markets, enhance consumer choice, and drive innovation in product distribution. However, recent enforcement and advocacy efforts by several competition agencies have revealed concerns about anticompetitive behavior in the online marketplace. These concerns about potential market fragmentation are significant among organizations that have examined the competitive dynamics of e-commerce.
UK E-commerce Market Trends
Innovations in 5G Technology is Driving the Market Growth
- The UK e-commerce market has witnessed a notable uptick, propelled by the swift adoption of 5G technology. 5G's hallmark features, including high speeds and minimal latency, have reshaped the online shopping experience. This next-gen wireless tech has translated to quicker downloads, faster transactions, and reduced page-loading times, nudging customers toward completing purchases swiftly, thereby boosting e-commerce conversion rates.
- Furthermore, 5G's enhanced connectivity has enabled the integration of cutting-edge technologies like augmented reality (AR) and virtual reality (VR). These technologies have revolutionized product visualization, elevating customer engagement levels. A survey conducted by Analysys Mason revealed that the United Kingdom rolled out its 3.5G Hz (5G) network in 2023, with plans to maintain this coverage until 2025. By 2023, this network had already spanned 68% of the country's population and 12% of its geographical area.
- 5G's standout feature, its ability to handle numerous devices simultaneously without compromising performance, has catalyzed the growth of the Internet of Things (IoT) in e-commerce. This means that smart devices, from home appliances to wearables, can now seamlessly collaborate, offering shoppers personalized and automated experiences. Think of a scenario where a smart fridge monitors its contents and autonomously orders groceries, while wearables suggest products based on the user's preferences and activities. Such enhanced connectivity has not only streamlined operations for retailers but also crafted a more bespoke and convenient shopping journey for consumers.
- Moreover, the heightened reliability and security of 5G networks have been pivotal in bolstering e-commerce's growth trajectory. With advanced encryption and authentication, 5G has fortified cyber defenses, instilling greater trust in online transactions. This, in turn, has expanded the pool of online shoppers. Additionally, 5G's scalability has equipped businesses to handle surges in traffic and data, underpinning the seamless growth of online retail.
- In 2022, the predominant technology for mobile data connections in the United Kingdom was 4G, also known as LTE. However, a significant shift is on the horizon. By 2030, 5G technology is projected to dominate, constituting a substantial 93% of all connections. This transition is poised to bolster the UK e-commerce market significantly.
Increased Adoption of Online Payments is Driving the Market Growth
- The UK e-commerce market is experiencing significant growth, driven by the increasing adoption of online payments. Digital wallets, contactless payments, and other innovative solutions are enhancing consumers' convenience in online shopping. The efficiency and simplicity of these transactions have improved the customer experience, reducing common pain points such as lengthy checkouts and repetitive payment entries. As a result, conversion rates and customer loyalty have increased as shoppers value the streamlined and secure nature of digital payments.
- Implementing secure payment gateways and advanced encryption technologies has also strengthened consumer trust in online transactions. Features like two-factor authentication and biometric verification have significantly mitigated fraud risks, further encouraging online purchases. Maintaining this level of security is crucial for fostering customer trust, which is essential for the sustained growth of e-commerce.
- The diversity of online payment options caters to various consumer preferences and financial situations. From traditional credit cards to modern offerings like buy now, pay later (BNPL) services and cryptocurrencies, the variety of choices ensures customers can select the most suitable method. This inclusivity not only expands the customer base but also enhances accessibility, making online shopping a viable option for a larger demographic.
- Moreover, the seamless integration of payment solutions with e-commerce platforms has optimized purchasing. Features such as one-click payments, stored payment details, and mobile app integration have made online shopping more efficient and appealing. Consequently, businesses are capitalizing on impulse purchases and seeing a reduction in cart abandonment rates.
- As of 2024, a survey by Salesforce revealed that 60% of UK e-commerce vendors offer buy now, pay later services on their websites. Noteworthy is the significant presence of PayPal among UK merchants in 2024, alongside a growing interest in cryptocurrency. However, the survey did not specify whether merchants were looking to directly accept Bitcoin payments or if they were considering third-party payment aggregators.
UK E-commerce Industry Overview
The UK e-commerce market is fragmented, with many players in the market. However, a few prominent players in the market, such as Amazon UK, occupy a considerable market share. Players like eBay and Asos are also trying to increase their share in the market. Moreover, the growing e-commerce industry is also encouraging the development of distribution centers across the country.
- March 2024 - Ryft, an innovative payments provider, announced a strategic partnership with the global payments provider American Express (Amex). This collaboration aims to enhance payment flexibility for UK e-commerce merchants, enabling them to accept Amex Card payments efficiently.
- January 2024 - JD.com, also known as Jingdong in Europe, and Evri, a parcel delivery company in the United Kingdom, announced a strategic partnership. This collaboration aims to enhance the market penetration of British and European businesses in China. The partnership will enable European businesses to sell their products directly to JD.com's nearly 600 million active customers. By integrating JD.com's advanced e-commerce platform in China with Evri's extensive delivery network across Europe, the partnership will provide businesses with a seamless and efficient gateway to the Chinese market. Additionally, JD.com will enhance its pick-up services for European and UK brands as part of this collaboration.
UK E-commerce Market Leaders
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Amazon.com, Inc.
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Ebay UK
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Asos
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Currys PC World
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Gumtree
*Disclaimer: Major Players sorted in no particular order
UK E-commerce Market News
- May 2024 - Metapack, a prominent player in e-commerce delivery technology, announced that Mountain Warehouse, a significant outdoor clothing company in the United Kingdom, extended its partnership with Metapack to enhance its delivery capabilities and support its growth strategy. Already utilizing Metapack Delivery Manager, Mountain Warehouse incorporated Metapack’s Delivery Options and Metapack Intelligence solutions into its operations. This investment in shipping infrastructure aims to deliver superior e-commerce experiences to customers across the United Kingdom and Canada.
- March 2024 - Kin + Carta, a global player in digital transformation consulting, introduced an advanced generative AI and large language model (LLM) tool for the UK retailer Matalan. This innovative tool enables Matalan to efficiently generate comprehensive product descriptions for new items as they are added to its online inventory.
UK Ecommerce Market Report - Table of Contents
1. INTRODUCTION
- 1.1 Study Assumptions and Market Definitions
- 1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET INSIGHTS
- 4.1 Market Overview
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4.2 Industry Attractiveness-Porter's Five Forces Analysis
- 4.2.1 Bargaining Power of Suppliers
- 4.2.2 Bargaining Power of Buyers/Consumers
- 4.2.3 Threat of New Entrants
- 4.2.4 Threat of Substitute Products
- 4.2.5 Intensity of Competitive Rivalry
- 4.3 Key Market Trends and Share of E-commerce of Total Retail Sector
- 4.4 Impact of Macro Economic Trends on the E-commerce Sales
5. MARKET DYNAMICS
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5.1 Market Drivers
- 5.1.1 Increase Developments of 5G Technology
- 5.1.2 Increased Adoption of Online Payments
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5.2 Market Challenges
- 5.2.1 Data Security
- 5.3 Analysis of Key Demographic Trends and Patterns Related to the E-commerce Industry in United Kingdom (Coverage to include Population, Internet Penetration, E-commerce Penetration, Age and Income, etc.)
- 5.4 Analysis of the Key Modes of Transaction in the E-commerce Industry in the United Kingdom (Coverage to Include Prevalent Modes of Payment such as Cash, Card, Bank Transfer, Wallets, Etc.)
- 5.5 Analysis of the Cross-border E-commerce Industry in the United Kingdom (Current Market Value of Cross-border and Key Trends)
- 5.6 Current Positioning of the United Kingdom in the E-commerce Industry in Europe
6. Market Segmentation
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6.1 By B2C E-commerce
- 6.1.1 Market Size (GMV) for the Period of 2022-2029
- 6.1.2 Market Segmentation - by Application
- 6.1.2.1 Beauty and Personal Care
- 6.1.2.2 Consumer Electronics
- 6.1.2.3 Fashion and Apparel
- 6.1.2.4 Food and Beverage
- 6.1.2.5 Furniture and Home
- 6.1.2.6 Others (Toys, DIY, Media, etc.)
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6.2 By B2B E-commerce
- 6.2.1 Market Size (GMV) for the Period of 2022-2029
7. Competitive Landscape
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7.1 Company Profiles
- 7.1.1 Amazon.com Inc.
- 7.1.2 eBay UK
- 7.1.3 Asos
- 7.1.4 Currys PC World
- 7.1.5 Gumtree
- 7.1.6 Argos
- 7.1.7 John Lewis and Partners
- 7.1.8 Tesco
- 7.1.9 Marks and Spencers
- 7.1.10 Asda
- *List Not Exhaustive
8. Investment Analysis
9. Future Outlook of the Market
UK E-commerce Industry Segmentation
Conducting an e-commerce business means fostering relationships and selling information, services, and goods over computer communication networks. The study aims to analyze and understand the UK e-commerce market's current growth, opportunities, and challenges.
The UK 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 others [toys, DIY, media, etc.]) and B2B e-commerce. The market sizes and forecasts are provided in terms of value (USD) for all the above segments.
| By B2C E-commerce | Market Size (GMV) for the Period of 2022-2029 | |
| Market Segmentation - by Application | Beauty and Personal Care | |
| Consumer Electronics | ||
| Fashion and Apparel | ||
| Food and Beverage | ||
| Furniture and Home | ||
| Others (Toys, DIY, Media, etc.) | ||
| By B2B E-commerce | Market Size (GMV) for the Period of 2022-2029 |
UK Ecommerce Market Research FAQs
How big is the UK E-commerce Market?
The UK E-commerce Market size is expected to reach USD 280.55 billion in 2024 and grow at a CAGR of 21.76% to reach USD 750.80 billion by 2029.
What is the current UK E-commerce Market size?
In 2024, the UK E-commerce Market size is expected to reach USD 280.55 billion.
Who are the key players in UK E-commerce Market?
Amazon.com, Inc., Ebay UK, Asos, Currys PC World and Gumtree are the major companies operating in the UK E-commerce Market.
What years does this UK E-commerce Market cover, and what was the market size in 2023?
In 2023, the UK E-commerce Market size was estimated at USD 219.50 billion. The report covers the UK E-commerce Market historical market size for years: 2019, 2020, 2021, 2022 and 2023. The report also forecasts the UK E-commerce Market size for years: 2024, 2025, 2026, 2027, 2028 and 2029.
What are the future trends expected in the UK E-Commerce Market?
Key future trends in the United Kingdom E-Commerce Market are: a) Rise of AI and personalization b) Increased use of voice search c) Expansion of omnichannel retailing d) Growth of sustainable and ethical shopping practices
What are the future trends expected in the UK E-Commerce Market?
Key future trends in the United Kingdom E-Commerce Market are: a) Rise of AI and personalization b) Increased use of voice search c) Expansion of omnichannel retailing d) Growth of sustainable and ethical shopping practices
Online Retail in UK Industry Report
The UK's e-commerce landscape is booming, fueled by digitalization and a growing preference for online shopping. Advanced technologies like AI and automation are enhancing user experiences with personalized services, while the shift towards mobile commerce underscores the need for mobile optimization among UK e-commerce companies. The market, thriving across segments like beauty, electronics, and fashion, benefits from the convenience and variety online shopping offers. Innovations in social commerce and digital payments are making shopping more accessible, amidst a competitive environment where companies strive to offer flexibility and personalized experiences. This dynamic market offers UK e-commerce companies significant opportunities to meet the diverse needs of their customer base. According to Mordor Intelligence™ Industry Reports, the Online Retail in UK market is witnessing substantial growth in market share, size, and revenue, with detailed analysis and forecasts available in their free report PDF download, highlighting the promising outlook for UK e-commerce companies.
