E-commerce has benefited retailers by way of increasing access to customers and

information and also reducing the cost of operation and 2010. over the past few
years, electronic commerce (EC has also enhanced the financial performance of
organizations, removed some of the barriers to market entry, improved business
efficiency and effectiveness, streamlined inventory management and brought down
the cost (Liu, Marchewka, Lu. & Yu, 2005). From a retailer's perspective, how E-
commerce is likely to reshape their markets and business pro- cesses is crucial
(Ellis-Chadwick, Doherty, & Hart, 2002). Notwithstanding of the millions of dollars
spent on creating and maintaining corporate websites, many corporations have failed
to reach the organization's goals (Hausman & Siekpe, 2009). One crucial principle,
according to Butler & Peppard Cl998), which holds true in the market space, is that
marketers must understand the behavior intention of consumers before they can
effectively respondtotheir demands. These phenomena open the room to for
managers and academicians to emphasize and focus on the implementation of Apps
as a core marketing and business activities. Regardless of the economic downturn
since 2005 which has stricken the Internet and telecommunication sectors, it is
predicted that electronic commerce (EC) will continue to grow (Liu et al., 2005). The
increasing international competition has raised the question of how firms can
effectively manage the new economic order in their domestic markets as well as
other international markets (Lindman, 2010) This is crucial for all kinds of industry.
Retail functions have been discussed in an academic debate with regard to retailers'
justification and their contribution to economic welfare and prosperity (Madlberger,
2004). Economic theory argue that purchased via would occur if the channel
minimizes the transactions costs (Ward, 2001). This could be the overwhelming
reason why all vendors are starting to brace the digital transformation such as Apps
and related technologies.

e-commerce - the buying and selling of goods and services over the Internet . Today
it's almost impossible to do business without embracing ecommerce.

E-commerce in the United Kingdom: Facts & Figures 2016

 E-commerce in Europe

June 9, 2016 by Gemma

With an online sales growth rate of 16.2%[1] in 2015, which is expected to grow by a further 14.9%
in 2016, there is great potential for e-commerce in the UK. What’s more, 77%[2] of UK Internet users
made a purchase online in 2015, placing it as one of the leading markets in Europe.  If you’re already
established or are looking to get on the UK market, read on to find everything you need to know
about online retail in the United Kingdom.
E-commerce in the UK

Great potential for the United Kingdom’s e-commerce market

According to We Are Social, the UK has a population of 64.91 million people. Of these people, a huge
92% are Internet users[2], creating huge potential for e-commerce businesses.

Internet use in the United Kingdom

Online sales : growth and market share

77% of UK Internet users made a purchase online in 2015[2], which according to Retail Research,
encouraged online sales to grow by 16.2% in 2015. We can expect further growth in 2016, with
current predictions standing at 14.9%

The online share of retail trade is also on the rise: while it only represented 13.5% in 2014, this
increased to 15.2% in 2015 and is expected to rise further to 16.8% in 2016[2].

Online share of retail trade in the UK

Online retailers

Top 10 e-commerce sites in the UK

Amongst the most visited UK e-commerce sites[3], we can find some of the biggest global e-
ecommerce players such as eBay and Amazon. However, we can also see that UK retailers such as
Tesco, Argos and Next, have all successfully adopted e-commerce into their strategies.
British consumer behaviour
What do British consumers buy and how much do they spend?

In 2015, the average order value stood at £78.74[4], which was actually 2.43% lower than in 2014 at
£80.65.

Amongst the most popular product categories for British consumers, we find clothing, books and
home electronics[5]. These three categories are also top categories at a European level.

Top product categories

Cross-border purchases

58% of British online consumers bought a product overseas in 2015[6], ranking in first place in
Postnord’s e-commerce study. When British consumers buy abroad, they are most likely to turn to
products from American, Chinese or German websites.

Top 3 foreign countries UK consumers buy from

Logistics

Delivery preferences

In terms of delivery preferences, we can see that delivery at home remains the top choice⁴, while
collect in store has snapped up second place thanks to the rising popularity of click-and-collect. We
can also see that using a pick-up point is popular, coming in third place with 22%, probably due to
the lower costs involved with this method.

Top 3 delivery methods

Preferred payment methods

Payment using a credit or debit card is the most popular in the UK with 49% of consumers choosing
this method. Closely behind in second place we find the increasingly popular PayPal (or similar
services) with 40% and finally payments direct through the bank, which comes in third place with
just 5%.

Top 3 online payment methods

M-commerce

M-commerce in the UK

With 74.92 million mobile connections, representing 115% of the population, the UK has huge
potential for m-commerce. So much so, 60% of retailers in the UK have already adopted mobile
channels[6], however there is still a way to go for UK retailers to fully make most of this channel.

Number of mobile connections

E-commerce traffic on mobile devices

Over 30% of e-commerce traffic is on a mobile device in the UK, placing it is first place in Twenga
Soltuions’ m-commerce study[7]. In terms of mobile traffic distribution, 30% is on tablets while a
huge 70% is on smartphones. The large proportion on the latter device is more than likely due to the
rising popularity of larger screens on mobile phones.

E-commerce mobile traffic per device

Online advertising and e-commerce

Share of digital advertising spend in the UK

Investments in digital advertising are increasing year on year. In 2015, they represented 49.6% of
total media ad spending in the UK, and eMarketer expects that this could reach 57.5% by 2019[8].
Given the growth of e-commerce in the UK, it is normal that more and more advertisers are choosing
to dedicate a more significant part of their advertising spend to online channels.

Share of digital in total media ad spend

What challenges are online retailers in the UK to face in 2016?

There are a range of issues UK retailers are set to face in 2016. Emerce[9] explains that retailers will
have to meet expectations during the online checkout process. Free shipping, a variety of payment
options and an estimated (or even guaranteed) delivery date being the most important options.

However, one of the main channels e-retailers are to face will be to offer users a personalised
experience. In a study by Quantcast[10] earlier this year, it was revealed that UK consumers want
mobile advertising to be more creative and 59% of consumers agree that they would be more
accepting of mobile advertising if it was relevant to them.

To make the most of this trend and exploit the tremendous amount of data available, online
retailers can use automated solutions, which will allow campaign managers to adapt their
advertising to platforms such as AdWords, Google Shopping and Facebook. Doing so can ultimately
free up time that could be used on other business objectives such as perfecting a multi-channel
strategy.

There is no doubt that now is the right time to adopt search marketing campaigns if e-retailers have
not already done so : Adobe recently announced that year-on-year, CPCs have decreased by 4% in
Europe and click-through rates increased by 14% in 2015, making PLAs and text-based ads more
profitable than ever. E-retailers should take advantage of this opportunity and work on optimising
existing campaigns or getting started on these essential platforms for e-commerce advertising.

Sources:

[1]  Retail Research : Online Retailing Britain, Europe, US and Canada 2016
[2]  We Are Social : 2016 Digital Yearbook

[3]  SimilarWeb : Website ranking

[4]  it works : 2015 e-commerce average order values

[5]  Postnord : E-commerce in Europe 2015

[6]  PAC : Omnichannel retail in Europe

[7]  Twenga Solutions – M-commerce in Europe 2015

[8]  eMarketer – Digital ad spending per region & industry

[9]  Emerce : Onderzoek: wat zijn de eisen van de online shopper?

[10]  Internet Retailing : Consumers demand more relevant ads