The U.K. has long been one of the world’s premier hotspots for online exports and sales. In fact, on its own, it boasts the fifth-largest economy in the world and second-largest in Europe. With a recorded $3.1 trillion gross domestic product as of September 2015, the U.K. is enjoying one of its best periods of economic growth in 60 years.
But, beyond these broad economic advantages, the U.K. has also emerged as one of the strongest ecommerce markets around – ranked first in Europe and fourth throughout the world. A 77 percent Internet penetration rate coupled with an average 9.9 mbps connection speed (slightly higher than the average U.S. connection) has enabled more U.K. consumers to shop online. In fact, just this year alone, online sales have grown by over 16 percent, surpassing ecommerce growth rates even in the United States and Canada. U.K. ecommerce purchasing has become so prominent that it’s expected to account for 18 percent of all national retail sales by 2018.
So, what’s behind that growth?
The Move to Mobile
The widespread proliferation of mobile shopping via smartphones and tablets has been a key driver of overall ecommerce growth. Last year, mobile-driven sales surged by more than 53 percent, accounting for nearly 25 percent of all retail ecommerce transactions conducted in the U.K. This rise in omni-channel purchasing has helped open the door for retail sales growth opportunities, but it also presents a new challenge – namely, higher competition. The added convenience afforded by online shopping, compounded by the sheer number of retailers available, means that companies will have to develop innovative strategies for breaking through to customers and capturing their attention while accommodating their online purchasing preferences.
Cross-Border is Thriving
Not only are a wide majority of U.K. residents connected to the Web, they also have a strong familiarity with U.S. and other international brands – an affinity that in turn encourages cross-border shopping. According to the Office for National Statistics, the number of adults in the U.K. who purchase products from the rest of Europe increased to 23 percent in 2014 up from 12 percent in 2008. Additionally, the number of U.K. adults who make cross-border purchases grew from 18 percent to 21 percent over that same time period. Both of these figures are approximately double that of the only 10 percent of EU adults who engage in cross-border shopping.
They Know What They Want
While it goes without saying that demand for U.S. and other international brands is thriving in the U.K., the trend underscores another impact for retailers to note – U.K. shoppers know what they want. Before placing an order online, they look for sellers that emphasize high-quality customer service, convenient pricing and benefits like free international shipping. Highlighting those qualities (or failing to do so) can be a make-or-break decision for retailers looking to better promote international sales.
Opening the Ecommerce Doors
There has never been a better time for U.K. retailers seeking to capitalize on the ecommerce boom, evidenced by 11 of the U.K.’s most prominent retailers doing just that earlier this summer.
With online shopping becoming a fixture of U.K. lifestyles – particularly across borders – companies can now more easily ensure they’re engaging buyers at home and abroad with an intuitive, easy-to-use ecommerce platform.