The UK ecommerce statistics 2021 - Insights for businesses to scale up in the UK ecommerce market

The years of 2020 and 2021 saw a significant improvement in the UK economy towards digitalization. The shift took place at the fastest pace than ever before when it comes to the UK ecommerce market. The article is going to give you an overview of the market share, digital payment trends in ecommerce and help you plan for the future business development.

The UK ecommerce statistics 2021 - Insights for businesses to scale up in the UK ecommerce market

E-commerce has become an integral aspect of the global retail landscape in recent years. The retail sector, like many other businesses, has changed dramatically since the internet's introduction, and because of the ongoing digitalization of modern life, consumers from practically every country now benefit from the conveniences of online purchases. The number of digital buyers grows every year as internet access and adoption grow at a rapid pace around the world. In 2020, nearly two billion people will have purchased products or services online, with global e-commerce sales exceeding 4.2 trillion dollars.

In Europe, the UK ecommerce market size takes the most developed share. According to the Office of National Statistics (UK), the country's e-commerce revenue in 2019 totaled 693 billion GBP, up significantly from the previous year. Wholesale and manufacturing were the two largest industry sectors that generated the most e-commerce sales in the same year on a sectoral basis.

The retail sector, in which the United Kingdom dominates Europe, accounted for almost 8% of total e-commerce sales. Online sales accounted for 19.4% of all retail sales in 2019 and are expected to grow in the coming years, owing to the coronavirus pandemic's impact. Only 46.1 percent of internet retail sales grew in 2020, the fastest rate in a decade. Online sales accounted for more than a quarter of all retail sales in textile and garment stores, according to the most recent official data - The UK ecommerce statistics 2021.

(According to > statista.com )

How UK’s Retail E-commerce Compares to Other Countries

With a total of USD $180.39 billion in retail e-commerce sales in 2020, the UK came in third behind China (USD $2,296.95 billion) and the United States (USD $794.50 billion). According to eMarketer , UK ecommerce market share in retail sales will drop 6.3 percent in 2021, to USD $169.02 billion, as the market recovers from the initial Covid peak in 2021.

How UK’s Retail E-commerce Compares to Other Countries 2020&2021

Source: eMarketer

According to E-commerce News EU , the majority of purchases (73%) are made within the United Kingdom. 11% of purchases are made in EU markets, while 16% are made outside of the EU. With sales of $58.4 billion, the United States is the largest export market, followed by Germany with sales of $46.6 billion.

Customers in the United Kingdom enjoy shopping on international ecommerce sites. In fact, UK customers purchase more things from overseas internet businesses than shoppers in nearly any other wealthy country. These are the most important international ecommerce marketplaces for UK consumers. There was 16 percent at retailers located outside the European Union and the remaining 11 percent was bought online from an EU country.

Shoppers in the United Kingdom adore French clothes, perfumes, and cosmetics.

"When it comes to selling to UK consumers, France has had a very prosperous year," writes FinTech Futures . Exports to the UK grew by 32.8 percent in 2017. The fashion industry fueled most of the online boom, with the most popular names including Balmain, Givenchy, and Versace. Perfumes and cosmetics from French stores and brands, on the other hand, are quite popular in the UK ecommerce market.

The biggest overseas UK ecommerce market shares are the United States, Germany, France and the Netherlands.

Brits spent almost 58.4 billion euros on American goods last year. "The trading connection between the United Kingdom and the United States is one of the most valuable on the globe. Much of what is sold online is fashion-related, with American companies such as Forever21, Victoria's Secret, and American Apparel being extremely popular," according to the website.

German consumers spent 46.6 billion euros on their ecommerce websites, putting them in second place. Over 10.5% of total UK exports come from this western European country.

Where are UK online shoppers purchasing from?

Source: FinTech Futures

Key TakeAways

• UK online shoppers prefer to purchase domestic products online.
• Consumers say they are eager to buy British food to support the economy, but will look for cheaper foreign alternatives if food prices rise.
• Fashion, perfumes, and cosmetics from France are popular with British buyers.
• The United States, Germany, France, and the Netherlands are the most important abroad markets for British consumers.

Online shopping is challenging in-store purchasing in 2021 (ecommerce UK statistics)

According to a study conducted by Think with Google , there was a massive move to the internet is here to stay. The percentage of customers who say they will or plan to shop online vs in-store in the next six months is much higher than pre-pandemic levels in the fashion, cosmetics, and telecoms sectors.

Fashion industry alone saw a 28% increase in the annual online sales. While many individuals may return to in-store shopping to see, touch, and try on things, new habits have developed around internet purchasing that have irreversibly transformed the way people purchase.

Online shopping is challenging in-store purchasing in 2021

Source: Think with Google

Shopping attitudes have shifted across demographics in the UK ecommerce market 2021

The findings of Think with Google also reveal a steady shift in attitudes among different age groups. While the younger generation is still the most likely to purchase online, customers aged 35 and up are seeing the greatest increase in individuals choosing online retail over in-store shopping.

The shift in shopping: The data that reveals the permanent changes to U.K. consumer behaviour

Source: Think with Google

People are shopping online for a variety of reasons, including the pandemic

Even though the pandemic has been the primary driving force behind the shift from traditional shopping practice to online buying behaviour, the UK ecommerce market has been influenced by some other factors:

• Conveniency
• No store visit due to COVID
• Easy to find products
• Home delivery
• Cheaper prices

Key TakeAways

• There was a significant improvement in ecommerce growth in the UK 2021.
• Online shopping has been emerging across demographics in UK ecommerce statistics 2021.
• Apart from the Pandemic of COVID 19, there were various reasons that stimulated Brits to change their shopping habits, leading to the 2021 ecommerce growth UK.

Smartphone lead the game of online shopping in the UK ecommerce statistics

From a recent research of statista.com (the Statista Global Consumer Survey conducted in the UK in 2021), British consumers mostly shopped online via mobile devices. Smartphones are the most popular shopping device which was chosen by users in the UK, accounting for about 64% in total. Following that was Laptop, with 49% of total usage. Tablet washe third mobile device that UK online consumers made purchases.

Smartphone lead the game of online shopping in the UK

Source: Statista 2021

Top benefits when it comes to mobile shopping in 2021

Concerns regarding COVID-19 are a minor factor in the telecoms industry, because there are various perceived advantages of buying via a mobile phone online that outweigh any concerns about the pandemic.

Source: Think with Google - The shift in shopping: The data that reveals the permanent changes to U.K. consumer behaviour

Mobile customer experience is the key of customer retaining and satisfaction

Stay competitive by focusing corporate effort on contacting targeted, high-value shoppers, such as by creating audiences based on purpose or communicating directly with them via a messaging app.

On the other hand, digital mobile customer experience also reflects on your mobile app UX/UI which determines how mobile shoppers enjoy the buying process and enables them to keep the application in their phones.

Key TakeAways

• 64% of British online shoppers prefer to buy online on smartphones.
• Focusing on mobile customer experience helps businesses improve customer retention.

The health crisis had a significant impact on digital travel sales, but the future appears to be brighter.

Overall, internet travel booking accounts for 63 percent of the $1.2 trillion in annual revenue generated by the travel sector. The majority of people (82%) who book travel online do so through a website or mobile app, and they prefer to do so on a Monday.

Technology-driven solutions are an important factor in the traveler experience in 2021

• 70% of travellers research travel on their smartphone.
• 33% of consumers say they've used a virtual travel assistant to help organise and plan their next trip.
• Google data shows that travel related searches including ‘tonight’ and ‘today’ have grown by more than 519% in the past five years.
• 45% of UK travellers feel comfortable researching, planning and booking trips to new destinations using only their mobile.
• 72% of mobile bookings happen within 48 hours of last-minute Google searches.
• 148.3 million travel bookings are completed online every year.
• Online travel agencies offering customers ‘a one stop shop’ are expected to own 41% of the online digital travel market by 2020.
• Millennials prefer to book hotels via travel agencies but 52% browse the hotel’s website for more information.
• 82% of all travel bookings in 2018 were made online via a mobile app or website, without human interaction.
• Due to economic disruptions due to the COVID-19 pandemic, travelers in the UK became increasingly interested in the Buy Now Pay Later payment method.

Consumers in the United Kingdom are buying more things online than ever before, and by the end of 2021, online sales will account for nearly a third of all retail spending (30.2 percent). This represents an increase of 11% over the pre-pandemic share in 2019.

In 2022, overall internet spending will begin to level off, increasing by 0.10 percent to £120.6 billion. However, as individuals return to buying at a mix of online and offline merchants, the share of online sales as a percentage of overall retail spend is expected to shrink to 28.1 percent.

When comparing the year 2019-2020 to 2020-2021 in terms of physical store performance during the pandemic, total sales in bricks and mortar stores decreased by a massive £35.3 billion. However, the analysis predicts a steady recovery in the coming year, with physical sales expected to climb by £3.9 billion (1.4 percent) in 2021.

In 2020 over half of all payments in the UK were made using cards (ecommerce UK statistics)

As the world was devastated by the coronavirus pandemic in 2020, it was a year unlike any other, with enormous implications for how most of us live and work. Unsurprisingly, this had an impact on payment volumes in the United Kingdom, which fell by 11% to 35.6 billion in 2020.

While total card payments decreased in 2020, card payments as a percentage of total payments climbed, with cards accounting for over half (52%) of all payments. As a result of many merchants encouraging card and contactless use, as well as lockdowns, many individuals chose to purchase online instead of visiting physical stores or using contact-intensive services.

Source: UK Finance - Payment market summary 2021

In the United Kingdom, debit cards accounted for 44% of all payments

Despite a drop in debit card volumes as a result of the pandemic, debit cards remained the most popular payment method in the UK, accounting for more than four out of ten transactions. Payment volumes are expected to fall by 7% to 15.8 billion in 2020. Debit cards are currently held by the vast majority of the population (98 percent), and many people use them to make daily payments.

69% of adults in the UK have a credit card

In comparison to the previous year, there were 2.8 billion credit card payments, a decrease of 18%. A variety of variables could be to blame for the drop in credit card spending. This includes a shutdown that shut down credit card-heavy industries including vacations, travel, and entertainment. Consumer confidence is also tied to credit card spending, with many customers becoming more hesitant about taking on more debts when the economy suffers as a result of the epidemic. While credit card spending fell in 2020, repayments increased as consumers chose to pay off their debt over the course of the year.

Over a quarter of all payments in the UK were made via contactless methods

The number of contactless payments in the UK increased by 12% to 9.6 billion in 2020. The following factors contributed to this:

• Contactless limit increase to £45 in April 2020
• Retailers encouraging consumers to use contactless at point-of-sale during the pandemic
• The continued roll-out of card acceptance devices especially among smaller businesses
• Consumers becoming increasingly comfortable and familiar with making contactless payments

54% of all adults used mobile banking in 2020

The number of people who use internet banking (on a computer) or mobile banking (on a smartphone or tablet) rose in 2020. Over two-thirds of UK adults (72%) use internet banking, with more than half (54%) using mobile banking. Remote banking was used by a high percentage of people of all ages, ranging from 93 percent of those aged 25-34 to 84 percent of those over 65.

1/4 adults used mobile payments in 2020 (ecommerce UK statistics)

Mobile payments became the new emerging payment method in the UK ecommerce market. With its convenient offerings, more and more online shoppers prefer to shop on mobile and pay on mobile in 2020.

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