A guide to expanding your ecommerce business in the UK
Samir Kamnani
·January 17, 2025
UK customers are more primed than ever to make purchases from their phone or laptop, rather than popping down to the local shops. Today, ecommerce makes up 30% of all retail revenue in the country, with an 8.4% annual compound growth rate.
If you’re launching or growing an ecommerce business, the UK is a great place to be. The United Kingdom is third in the world for ecommerce sales, behind only China and the United States. But that also means you have plenty of competition—so if you’d like to build a successful online shop there, you’ll need a solid understanding of what your customers are looking for. With the right strategies and technology solutions at hand, you’ll be able to create a best-in-class customer journey for them at every stage.
In this article, we’ll learn more about what makes UK customers tick—and how you can build a thriving business by expanding your operations there, whether you’re starting from scratch or expanding from the US or another geographic market.
(If you’re a UK business expanding to the US, review our article for tips on success when expanding in the other direction.)
See how UK brand BullyBillows retained £200K revenue in 12 months
Learn moreThe UK online shopper profile
First off, who is most likely to buy your products and what are they buying?
As it turns out, it could be almost anyone: 80% of UK shoppers purchased items online last year. They were most likely to purchase apparel online (57% of shoppers), followed by footwear (41%), but they were also known to shop for products including electronics, food, cosmetics, and furniture.
When making a purchase, more than half of shoppers like to conduct research first, with 90% saying they avoided buying products from businesses that had less than a 4-star average rating. That means it’s crucial for your brand to focus on collecting social proof in the form of customer reviews, photos, and videos, so that prospective shoppers can feel comfortable before making a purchase.
They often seek products out through their search engines, with more than 42% of shoppers beginning the buyer’s journey with a web search. Social commerce is also a popular way for younger generations to find products: Gen Z consumers tend to prefer buying products from ads or links on Instagram (53%) and TikTok (41%), and Millennials more often make purchases they spot on Instagram (52%) and Facebook (49%). Make sure to involve both organic search, with optimised landing pages and blog posts, and paid social media campaigns in your marketing strategy to engage with your audiences.
Shopify’s State of Commerce report found that half of UK customers were cost-focused, and were more likely to switch from one product brand to another if the price was lower. In contrast, 39% are quality-focused, and more likely to stay loyal to brands that produce high-quality products.
However, 82% of shoppers said that they would become more loyal to brands in exchange for benefits, such as extra services or promotions. Only 6% of UK brands surveyed said they planned to invest heavily in the customer experience, leaving an opportunity gap that your business can fill by developing a best-in-class customer loyalty programme.
Shoppers’ perspective on returns
In our 2023 Consumer Report, we found that 78.6% of UK shoppers appreciate access to free returns and exchanges, and 65.1% value an easy-to-follow returns process.
What about return options? Shoppers love it when they can get a “returnless refund,” in which they can get a refund for an unwanted item without sending it back (first choice for 22.1% of shoppers), though shoppers were also happy to get access to at-home pick up options (22.1%) or in-person returns options (20.7%).
And while we know shoppers like free return shipping, most don’t feel entitled to it: 50% of consumers in a Statistica survey said that it was the customer’s responsibility to pay return shipping, with 35% saying the business should pay return shipping fees.
That means there’s a good opportunity to delight your shoppers with a premium returns experience, even if it costs them a small fee. With Loop’s Offset product, you can invite shoppers to pay a surcharge at the point of purchase in exchange for a free, no-hassle return later.
Setting up a great ecommerce experience
While Amazon and eBay are among the most popular ecommerce marketplaces in the UK, sellers can maintain more control over their brand and the customer experience by setting up their own branded shop on a separate domain.
The leading ecommerce platform Shopify powers more than 190,000 individual stores in the UK, the most in any country after the United States. If you’re already using Shopify to power a US or other international store, you can use the Shopify Markets feature to instantly create a new shopfront for your UK market. You’ll be able to curate your inventory based on the products that you want to market there, and automatically customise currency, spelling or language, domain, collection of duties and taxes, payment options, and other features in line with adapting to the UK market.
Shopify Markets makes it easy to operate your store across multiple countries or regions with custom rules and settings for each one to provide a personalised experience for your buyers. You can also sync your Shopify store with local vendors for each geographic market, such as UK-based payment processors, mail carriers, and other region-specific solutions. Our returns management platform, Loop, syncs effortlessly with Shopify and offers seamless integrations with UK, US, and Australia-based tech providers, so you’ll be able to easily set up a no-hassle UK returns experience that’s customised to each of your ecommerce shop’s countries.
How Loop can help you grow your UK ecommerce business
Using Loop, you have access to a versatile range of options for automating and processing customer returns—whether they wish to return items to an in-store location with our point-of-sale tool, or return items by mail via the shipping carrier and method of your choice. If your headquarters is outside of the UK, you can either designate returned items to be shipped to an in-country 3PL or consolidation point, or authorise them to be shipped directly back to your central warehouse.
You can even set up custom rules for how to treat a returned item: For instance, if an item falls below the price point that you’d recoup your costs if you had it shipped back, you may choose to authorise a returnless refund. Or you may set up different criteria for different customers using Workflows, by allowing free return shipping for members of your VIP programme whilst requiring paid return shipping for other UK shoppers.
You’ll be able to effortlessly sync your product returns data in Loop with your international sales and returns data from the US and Australia, giving you a global perspective on sales and returns trends. You can drill down on return reasons to identify why products are being returned more frequently in one region than another, such as incorrect sizing recommendations for UK shoppers. Armed with robust data insights, you’ll be well-equipped to improve your inventory selection and product descriptions for each reason, helping you reduce return rates and delight your customers in every country.
Loop’s automated workflows can help you save time by streamlining return policy management—ensuring that your customers can resolve issues quickly, while freeing up your customer support agents’ time to focus on more high-touch concerns and deliver a personal touch.
And when customers request a return, Loop makes it easy to offer a product exchange instead, presenting a seamless exchange process whether they’re choosing a direct variant or any other item from your store. Our exchange-optimised returns experience empowers you to preserve more revenue from returns by transforming them into exchanges—helping you keep your customer retention rates high.
Whether you’re starting a new UK-based business, or expanding overseas, pairing Shopify and Loop will give you the tools you need to grow your customer base and boost loyalty rates with a superior shopper experience, from the first touch to the last.
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With Loop, your brand can offer everything from refunds to direct exchanges to shopper incentives and more. Even better? These exchanges build your business.