Expanding your business internationally is an effective growth strategy, especially when deciding to move into the UK’s lucrative market.
The United Kingdom is the largest per capita e-commerce market and the second largest online-advertising market in the world, after the United States. There are many opportunities within this market for small and mid-sized businesses to expand internationally. According to research conducted by the Boston Consulting Group (BCG) for Google; residents of the U.K. are increasingly becoming more active on the internet; averaging 65% higher now than three years ago.
The research by BCG also found that about 62% of adults, or 31 million people, have made a purchase online. The IMRG British Population Survey E-Shopping Report announced in April 2010 that over 51% of British adults had shopped within the previous three months, with 76% of Britons having internet access. The number of online shoppers has grown since then, and is expected to continue to grow, as consumer acceptance of online shopping and broadband adoption increases.
Popular Industries for E-Commerce in the UK
While industries across the board have been affected by the adoption of e-commerce, there are several industries which have become especially popular for small and mid-sized start-ups to enter into:
Books: A Study from Retail Moves shows that while the e-retail industry is expanding across all markets, books currently top the charts as the most popular internet purchase.
Groceries: The IMRG study shows that online grocery shopping is growing 50% faster than other e-shopping industries.
Fashion: BCG found that online sales accounted for nearly 14% of apparel sales in the UK in 2010, and it continues to grow by 15% each year.
Insurance: Insurance was traditionally sold by brokers or agents paid by commission, but the Internet introduced aggregations that allowed customers to quickly compare quotes for themselves.
Expanding E-Commerce Business in the U.K.
Expanding into international markets is a profitable growth strategy that businesses of all sizes can do, especially in a market as profitable as within the U.K.
Some other interesting facts uncovered by BCG are:
The Internet contributed an estimated £100 billion in 2009.
London is the leading region for Internet use, followed by the South East and East of England. Internet usage is lower in the rest of the country.
The UK Internet economy grows by 10% per year.
Consumption will be the largest contributor to growth; assuming modest increases in broadband adoption and in consumer acceptance of online shopping.
Consumers benefit from the Internet by purchasing products offline which they researched online (about £40 billion per year), by saving money through online shopping (about £18 billion per year), and by consuming free online content (about £5 billion per year).
So far studies conducted on e-commerce business in the UK, are very encouraging for businesses within the US to expand into this market.