2021
9
UK Online Retailing: Delivery, Collection and Returns Market Report 2021
2021-12-01T03:04:54+00:00
OX1049261
2195
145868
[{"name":"eCommerce","url":"https:\/\/store.mintel.com\/industries\/retail\/ecommerce"}]
Report
en_GB
“Following a pandemic-driven record-breaking surge in online shopping, the online channel has penetrated nearly all aspects of retail in the UK. The next couple of years will see retailers and…

UK Online Retailing: Delivery, Collection and Returns Market Report 2021

£ 2,195 (Excl.Tax)

Description

The UK Online Retailing: Delivery, Collection And Returns report identifies consumer attitudes towards delivery, collection and returns, ecommerce retailers and online retailers post sale services in the UK. This market report covers the market size, market forecast, market segmentation and industry trends for the Online Retailing: Delivery, Collection And Returns market in the UK.

Current Market Landscape 

Despite the remarkable advances made over the last decade in online retailing and the now ubiquity of shopping online, half or more of online shoppers had experienced issues when having purchases delivered, collected or returned over the last year.

  • Record growth during the pandemic saw the online retail channel grow by 44.9% in 2020.
  • In 2020 online sales accounted for a record 27.6% of all retail sales.
  • In 2020, some 81.5% of online sales were fulfilled through delivery, with collection accounting for 18.5% of the market.

COVID-19 has provided a truly remarkable boost to the online retail sector, accelerating its growth far beyond what was expected and embedding regular online shopping into more consumers’ lives. As the pandemic recedes, we expect that the sector will experience a couple of years of flat or negative growth as it absorbs these gains. Ultimately though the pandemic has driven deep behavioural changes that we think are here to stay.

Future Market Trends in Online Retailing

Overall, the future looks very rosy for the online sector for the reasons listed above. Retailers active in the sector do need to be aware of the ethical considerations, however. The UK’s shoppers are increasingly ethically aware and are choosing to shop with brands and retailers that mirror their own values. Online retailers are set to face a lot of scrutiny in the coming years and should work hard to build ethical companies.

There are many opportunities in the sector going forward. A key area for investigation for retailers is to work out what the ideal online purchase fulfilment looks like for consumers themselves. Deliveries are incredibly convenient but often require being at home. Collections mean you have to leave home, but you can do so at your own discretion. Working out the best mix to suit both their needs and their customers’ needs will be key for retailers moving forward.

Read on to discover more details or take a look at all of our UK Retail market research.

Quickly understand

  • The impact the COVID-19 pandemic has had on consumer behaviour and attitudes around delivery and collection services.
  • The size of the market for collection, and the impact that the events of the last 18 months have had on collection-based sales.
  • The key methods used to receive online purchases over the past year and how COVID-19 has affected them.
  • The friction points experienced by shoppers when receiving, collecting or returning purchases made online.
  • The key factors that influence consumers when choosing online retailers to shop with.

Covered in this report

Brands: Amazon, eBay, Tesco, Sainsbury’s, John Lewis, Asda, Dixons Carphone, Next, The Very Group, Ocado, Wayve, Getir, Gorillas, Weezy.

Expert analysis from a specialist in the field

This report, written by Piers Butel, a leading analyst in the Retail sector, delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

Following a pandemic-driven record-breaking surge in online shopping, the online channel has penetrated nearly all aspects of retail in the UK. The next couple of years will see retailers and delivery companies working hard to develop new technologies and approaches to meet this demand in ways that are sustainable for both the planet and their margins.
Piers Butel
Retail Analyst

Table of Contents

  1. Overview

    • Key issues covered in this Report
    • COVID-19: market context
    • Economic and other assumptions
    • Products covered in this Report
  2. Executive Summary

    • Impact of COVID-19 on online retailing
      • Figure 1: Short-, medium- and long-term impact of COVID-19 on online retailing, 2020-25
    • The market
    • Online market set to experience a period of consolidation
      • Figure 2: Market forecast online sales (inc VAT), 2016- 26
    • Post-pandemic growth running ahead of pre-pandemic predictions
      • Figure 3: All online sales as a percentage of all retail sales, 2015-25
    • Delivery still overwhelming first choice for consumers
      • Figure 4: Estimated share of online sales, by fulfilment method, 2020
    • Confidence returns but remains volatile
      • Figure 5: Consumer Confidence tracker Index, 2016-21
    • Companies and brands
    • Amazon dominates online retail
      • Figure 6: Leading retailers’ share of all online sales, 2020
    • Ocado invests in driverless delivery
      • Figure 7: Wayve autonomous vehicle testing, 2021
    • The consumer
    • Pandemic has driven clear changes in online purchasing behaviour
      • Figure 8: Products purchased in the past three years, 2019-21
    • Home delivery remains the most popular choice
      • Figure 9: Methods of delivery used in the past year, 2019-21
    • Over half of consumers have returned items in the last 12 months
      • Figure 10: How goods were returned in the past year, 2020 and 2021
    • There remain rough edges in the online retail process
      • Figure 11: Issues reported when having purchases delivered, 2021
    • Consumers are increasingly aware of potential negative effects of online shopping
      • Figure 12: Attitudes around online retail; key issues and concerns, 2021
    • Value is king for the online shopper but customer service still has a role
      • Figure 13: Factors influencing choice of online retailer, 2021
  3. Issues and Insights

    • As prices rise, retailers look to improve profitability
    • Changing lifestyles and new opportunities
    • Still much room for improvement in key parts of the process
  4. Market Drivers

    • Financial confidence recovery remains shaky
      • Figure 14: Consumer Confidence tracker Index, 2016-21
    • Consumers marginally more confident spending on non-essential items
      • Figure 15: Consumer purchasing behaviours around non-essential items, 2021
    • A global supply chain crisis is adding to an already challenging outlook
      • Figure 16: Customers who have experienced stock shortages since the COVID-19 outbreak, 2021
    • Higher-income households benefited the most from the pandemic
      • Figure 17: Current financial situation compared to a year ago, by household income, 2021
    • Rise in homeworking set to change the way people shop
      • Figure 18: Post-pandemic lifestyle intentions, 2021
  5. Market Size and Performance

    • Online retail benefits from COVID-19-driven shopping behaviours
      • Figure 19: Short-, medium- and long-term impact of COVID-19 on online retailing, 2020-25
    • Market set absorb remarkable growth driven by pandemic
      • Figure 20: Market forecast online sales (inc VAT), 2016-26
      • Figure 21: All online retail sales (including VAT), market size and forecast, at current and constant prices, 2016-26
    • Grocery sales claim a record share of all online spend
      • Figure 22: Estimated breakdown of all online sales, by product category, 2020
    • Online penetration jumps to 28%
      • Figure 23: All online sales as a percentage of all retail sales, 2015-25
    • Collection accounts for under a fifth of the total market
      • Figure 24: Estimated share of online sales, by fulfilment method, 2020
      • Figure 25: Estimated collection market size, 2017-21
    • Market drivers and assumptions
      • Figure 26: Key drivers affecting Mintel’s market forecast, 2017-26
    • Forecast methodology
  6. Competitive Strategies

    • Amazon’s domination of the sector continues
      • Figure 27: Leading retailers’ share of all online sales, 2020
    • Amazon: a uniquely complex operation
    • Grocery sector: huge uptake but cost concerns remain
      • Figure 28: Store-based retailers’ online grocery sales as a percentage of total sales, 2015-21
    • Online fashion retailers forecast dark clouds ahead
    • Electricals: penetration reaches new heights
      • Figure 29: Online electrical goods sales as a percentage of all spending on electrical goods, 2016-20
  7. Launch Activity and Innovation

    • Amazon moves from online to in-store
      • Figure 30: Amazon 4-star store, 2021
    • Dark-store retailers making advances across UK retail
      • Figure 31: Getir billboard, 2021
    • Tesco’s partnership with Gorillas is the first of its kind
    • Co-op joins forces with Amazon for speedy deliveries
    • Currys and Uber form partnership to offer 30-minute deliveries
    • Asda pilots secure home delivery boxes
      • Figure 32: Asda’s home delivery box trial, 2021
    • Ocado starts driverless delivery pilot
      • Figure 33: Wayve autonomous vehicle testing, 2021
    • Next and Morrisons join forces to offer clothing collection and returns ‘pods’
  8. Impact of COVID-19 on Consumer Behaviour

    • Concerns around the virus have plateaued but remain high
      • Figure 34: COVID-19 Tracker, impact on online shopping behaviour and time spent in-store, 2020-21
    • Pandemic has led to financial polarisation amongst consumers
      • Figure 35: Financial situation since COVID-19 outbreak, 2021
    • Pandemic and Brexit combine to give retailers a supply chain headache
      • Figure 36: Stock shortages since COVID-19 outbreak, 2021
    • Online retail has been a vital lifeline during the pandemic
      • Figure 37: Attitudes towards online shopping and COVID-19, 2021
  9. Online Retail Usage and Products Purchased

    • Almost everyone shops online now
    • Large differences in how categories are purchased over last three years
      • Figure 38: Products purchased in the past three years, 2019-21
    • Older shoppers key to online growth
      • Figure 39: Age profiles of those shopping online over the past three years, 2019-21
    • Customers shopping across more categories
      • Figure 40: Repertoire of products purchased in the past year, by age, 2021
  10. How Purchases Are Received

    • Home delivery continues to dominate as collection usage tails off
      • Figure 41: Methods of delivery used in the past year, 2019-21
    • Click-and-collect schemes have stronger appeal for city dwellers
      • Figure 42: Attitudes towards click-and-collect, by area, 2021
  11. Returns

    • Over half of customers return products purchased online
    • Company collection points see usage rise as rollout continues
      • Figure 43: How goods were returned in the past year, 2020 and 2021
    • Younger shoppers still more likely to return
      • Figure 44: How goods were returned in the past year, by age, 2021
    • Customers want free returns
      • Figure 45: Interest in free returns when choosing an online retailer, by age, 2021
  12. Issues with Delivery

    • Late deliveries and excessive packaging are key concerns
      • Figure 46: Issues reported when having purchases delivered, 2021
    • Almost two fifths experienced two or more issues with deliveries
      • Figure 47: Repertoire of issues encountered when having purchases delivered, 2021
    • City dwellers particularly upset by late deliveries
      • Figure 48: Issues encountered when having purchases delivered, by area, 2021
  13. Issues when Collecting Products

    • Collection a more reliable option
    • Queues and stocking issues are the most common complaints
      • Figure 49: Issues when collecting purchases, 2021
    • Around a quarter of consumers experience two or more issues
      • Figure 50: Repertoire of issues encountered when collecting purchases, 2021
  14. Issues when Returning Products

    • Almost 60% have experienced issues when returning items
    • Partnerships can help make returns more convenient
      • Figure 51: Issues encountered when returning purchases, 2021
    • A third of consumers experienced one issue when returning
      • Figure 52: Repertoire of issues encountered when returning purchases, 2021
  15. Attitudes towards Methods for Receiving Online Purchases

    • Consumers unclear on how much online shopping they will be doing
    • Flexibility is key for consumers
      • Figure 53: Attitudes around online retail; flexibility and usage, 2021
    • Younger shoppers show marked interest in collection schemes
      • Figure 54: Attitudes around online retail; flexibility and usage, by age, 2021
    • Despite surge in usage, shoppers still have concerns with online retail
      • Figure 55: Attitudes around online retail; key issues and concerns, 2021
  16. CHAID Analysis – Online Delivery and Returns

    • Methodology
    • Older, more affluent shoppers concerned with impact of online retail
      • Figure 56: Online Delivery and Returns – CHAID – Tree output, 2021
      • Figure 57: Online Delivery and Returns – CHAID – Table output, 2021
  17. Factors Influencing Online Retailer Choice

    • Customers want value above all else
    • Customer service and reliable deliveries are also popular
      • Figure 58: Factors influencing choice of online retailer, 2021
    • Older shoppers more value-led as young shoppers choose convenience
      • Figure 59: Factors influencing choice of online retailer, by age, 2021
  18. Key Factors Required to Reach Greatest Audience

    • Methodology
    • Free deliveries and excellent customer service would reach nearly 80%
      • Figure 60: TURF Analysis – Online delivery and returns, 2021
      • Figure 61: Table – TURF Analysis – Online delivery and returns, 2021
  19. Appendix – Data Sources, Abbreviations and Supporting Information

    • Data sources
    • VAT
    • Abbreviations
    • Consumer research methodology
  20. Appendix – Central Forecast Methodology

    • Market forecast and prediction intervals
      • Figure 62: All retail sales, including VAT, best- and worst-case forecast, 2021-26
    • Market drivers and assumptions
      • Figure 63: Key drivers affecting Mintel’s market forecast, 2016-25
    • Forecast methodology

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

Market

Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.

Consumer

Mintel’s proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.

Brand/Company

Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.

Data

Market reports provide appendices of data to support the research and insight produced. Our databooks* are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.

*databooks not available with UK B2B Industry reports.

Below is a sample report, understand what you are buying.

Click to show report
2024 Sample Consumer Cover

Please Note: This is a sample report. All of the figures, graphs, and tables have been redacted. Our reports are available to download in PDF and PPT formats.

Trusted by companies. Big and small.

Want to speak to us directly?

Contact us with your enquiry and our expert global team can help.

Get in touch