A summary of eCommerce related information relating to the United Kingdom. This information is from "Preparing Your Business for Global eCommerce" prepared by the U.S. Commercial Service for exporters.
Last Published: 7/17/2016

Overview

The United Kingdom is made up of England, Wales, Scotland, and Northern Ireland. It has a long history as a major player in international affairs and fulfills an important role in the European Union, United Nations, and North Atlantic Treaty Organization. The United Kingdom is a leading trading power and financial center and is the third-largest economy in Europe after Germany and France. The United Kingdom has a population of 66 million. Although part of the European Union, the United Kingdom is not part of the Eurozone, and its currency is the pound sterling.

Statistics

Capital: London
Population:64.6 million
GDP(USD): 2.8 trillion
Currency: Pound Sterling
Language: English

Market Entry

Digital Advertising

Spending on digital advertising in the United Kingdom in 2014 was more than USD 11 billion, up 14 percent from 2013. Mobile advertising accounted for 59 percent of the market. The breakdown includes:
  • Paid search: 52 percent
  • Display: 32 percent
  • Classified: 15 percent
Other: 1 percent 
The United Kingdom is on course to become the first country in the world where spending on digital advertising outstrips all other traditional formats combined. As consumers increasingly shop on smartphones and tablets, more than half of the nation’s advertising budget is expected to go to digital media in 2015, with a boom in paid-for results on   search engines such as Google. The total UK advertising market will hit USD 24 billion in 2015, up 5.5 percent from 2014. Just over USD 12 billion will be spent on advertising via search engines, in mobile apps, on newspaper websites, or through video-on-demand services such as ITV Player or  4oD.
 

Fulfillment

Storeship, storeship.co.uk 

Electronically  Delivered Services

There is a special scheme for non-EU companies selling “downloadable software” over  the Internet to clients within the European Union. This type of transaction is classified    by the European Union as an electronically delivered service. Non-EU companies selling downloadable software to EU customers must be registered for value-added tax (VAT)   in
at least one member state within the EU. Different requirements apply for accounting for VAT, depending on whether the customer is a corporation or an individual and depending on where the customer is physically located.

Current Market Trends

Online sales grew 13 percent year-on-year in April 2015 following an unprecedented   dip of four months of single-digit growth, according to the latest figures from the   IMRG
Capgemini e-Retail Sales Index. April sales were up 4 percent month-on-month, the highest recorded for this period since 2007, as online shoppers were apparently unaffected   by he uncertainty regarding who would win the general election. April also saw the highest conversion rate yet seen in 2015 at 4.6  percent.

The global increase in average temperatures seemed to provide a boost to UK clothing sales; as a result, clothing industry growth increased 15 percent. The travel sector also continued to perform well in April, up 20 percent year-on-year. Mobile continued to drive overall online sales growth. April’s figures showed that mobile sales increased 52 percent year-on-year and 8 percent over  March.

Today, 59 percent of British buyers research products online before they purchase offline. Conversely, nearly half (49 percent) research products offline before making a purchase online. A quarter of British consumers (25 percent) research their purchases online only. The effect of growing Internet use and mobile penetration is particularly relevant for local businesses. Four out of 10 people use smartphones to look for local information, such as products and prices, and 61 percent do research locally a day or less before  purchase.

Popular Social Media Sites

  • Facebook
  • YouTube
  • Twitter
  • LinkedIn
  • Reddit
  • Instagram
  • Imgur
  • Tumblr
  • Pinterest 

Current Demand

Popular E-Commerce Sites

The top 20 UK e-commerce sites (in rank order of popularity)   are The most popular types of e-commerce sites  are
  • General online retailers
  • Price comparison sites
  • Department stores
  • Bus or train companies
  • Banks/financial institutions
  • Airlines
  • Supermarkets and grocery stores 

Online Payment

Almost all United Kingdom–based online businesses allow customers to use credit or debit cards. Visa and MasterCard are almost universally accepted. American Express, Diners Club, and JCB are less popular. Many websites use PayPal or other similar services. UK consumers are becoming much more aware of the issue of online identity theft and will generally conduct financial transactions only on secure  websites.
Popular payment methods include
  • Credit cards—40 percent
  • Debit cards—35 percent
  • PayPal—21 percent
  • Other—4 percent 

Major Buying Holidays

  • New Year’s Day
  • Valentine’s Day (February 14)
  • Easter
  • Mother’s Day (second Sunday of May)
  • Father’s Day (third Sunday of  June) 
  • Black Friday—retailers in the United Kingdom are slowing adopting the Black Friday sales even though Thanksgiving is not a UK holiday.
  • Christmas Day and Boxing Day (December 25 and 26) 

 

 
 

Prepared by the International Trade Administration. With its network of 108 offices across the United States and in more than 75 countries, the International Trade Administration of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.