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UK Online Retailing market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the Online Retailing - UK market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Products covered in this Report

This Report is designed to give an overview of the UK online retail market. We look at all online sales, both from store-based retailers and those that only trade online. We include an overview of the market, including forecasts for the way the market will develop, in-depth consumer analysis using our own data, and a look at the key players in the market through company profiles.

For our consumer research this year we asked questions on the following topics:

  • Who is shopping online and who has increased, or decreased, their use of the channel?
  • Which devices are they making purchases on?
  • What are their opinions on voice-led shopping?
  • How did they choose to receive purchases online?
  • Which retailers they shopped with, and whether these were online-only or store-based retailers?
  • What are their attitudes towards the impact online is having on the high street?
  • Who is a member of Amazon Prime and who owns Amazonproduced products?
  • What is important for a retailer to offer when customers are looking to shop online?
  • What are their attitudes towards their data and shopping online?

What you need to know

Online retail sales grew by 15.8% in 2017 to reach £59.7 billion and account for 16.3% of all retail sales in the UK. Whilst in pure growth terms this represents a slowing of the exceptional 21.1% growth seen in 2016, growth in the share that online takes of all retail sales is actually accelerating, with 1.6 percentage points added in 2017. It is hard to see anything other than strong growth for the channel in the next five years, with sales forecast to continue to grow in double-digits through to 2023.

With nine in 10 (92%) consumers shopping online, much of the growth within the sector is coming from existing users doing more of their shopping online. This is particularly true of younger consumers (aged 16-34) who were most likely to say they had done more online shopping in the past year. This increasing use of online by this age group is driving growth in smartphone shopping. Overall, 38% of consumers had purchased items via their phone in the past year, but this grows to 64% of 16-34s.

Amazon is the dominant player in the online market, accounting for just under a quarter (23%) of all retail sales in 2017. Onlineonly retailers, such as Amazon, now account for a slim majority (52%) of all online sales in the UK and the effects of this are certainly been felt on the high street. Consumers are not unaware of this, with 73% thinking that growth in online is responsible for physical stores closing whilst 37% think online-only retailers have unfair advantages over those with stores. However ultimately the market continues to grow, with online a channel perfectly suited to modern life, one that promotes convenience over all else. Indeed 68% think that online shopping is simply more convenient than visiting stores.

Expert analysis from a specialist in the field

Written by Nick Carroll, a leading analyst in the Retail sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

The growth in online retailing, at present, continues unabated. It is still a relatively young channel, accounting for a sixth of all retail sales in the UK, with much room to grow particularly in some categories, notable grocery. Awareness of its growth and the impact this is having on the high street equally continues to grow, but it is fundamentally a channel that is well suited to modern life, one that trades on convenience above all else. Nick Carroll
Senior Retail Analyst

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Table of contents

  1. Overview

    • What you need to know
      • Products covered in this Report
      • Executive Summary

          • The market
            • Online retail continues to grow in the double-digits
              • Figure 1: All online sales and forecast, 2013-23
            • Online retail accounts for just a sixth of all retail, leaving much room to grow
              • Figure 2: Online as a % of all UK retail sales, 2008-17
            • Pure players growing a little faster than store-based online sales
              • Figure 3: Online pure players’ and store-based retailers’ share of all online sales, 2008-18 (May)
            • Fashion the largest category
              • Figure 4: Online sales by product, 2017
            • Leading retailers
              • Amazon dominant…
                • Figure 5: Leading retailers’ share of all online sales, 2017
              • …and its brand is in rude health
                • Figure 6: Key metrics for selected brands, November 2017-May 2018
              • The consumer
                • Nine in 10 purchased products online in the past year
                  • Figure 7: Change in online shopping use, by age and gender, April 2018
                • Almost half of online shoppers collected products in the past year
                  • Clothing, footwear and accessories most popular online
                    • Figure 8: Products purchased online in the past year, April 2018
                  • Smartphone purchasing growing, particularly amongst 16-34s
                    • Figure 9: Devices used to shop online in the past 12 months, by age, April 2018
                  • Voice commerce has potential but needs to avoid the ‘gimmick’ tag
                    • Figure 10: Attitudes towards voice commerce, April 2018
                  • More shop with online-only retailers than multi-channel retailers
                    • Figure 11: Retailers shopped with in the past 12 months, April 2018
                  • Convenience driving online use, but consumers know this comes at a cost
                    • Figure 12: Attitudes towards online’s effect on the high street, April 2018
                  • Amazon is fostering an ecosystem through Prime and its consumer electronics
                    • Wide range and low prices staples of online retailing
                      • Figure 13: Importance of factors when choosing where to shop online, April 2018
                    • Majority are concerned about the level of data collected by retailers
                      • Figure 14: Attitudes towards data collection and shopping online, April 2018
                    • What we think
                    • Issues and Insights

                      • The changing retail landscape: Online and the high street
                        • The facts
                          • The implications
                            • The Amazon ecosystem is thriving, but are there any ways to combat it?
                              • The facts
                                • The implications
                                  • Voice commerce: VR 2.0 or the next leap in customer interaction?
                                    • The facts
                                      • The implications
                                      • The Market – What You Need to Know

                                        • Market conditions fertile for online growth
                                          • Online retail continues to grow in the double-digits
                                            • Pure players growing a little faster than store-based online sales
                                              • Digital downloads worth £4.7 billion
                                              • Market Drivers

                                                • Internet access at near universal levels
                                                  • Figure 15: UK household internet access, 2008-17
                                                • Four fifths own a smartphone
                                                    • Figure 16: Ownership of mobile phones, January 2012-December 2017
                                                  • Real incomes begin to climb once more
                                                    • Figure 17: Real wage growth: average weekly earnings vs inflation, January 2015-May 2018
                                                  • Confidence takes a hit in 2017
                                                    • Figure 18: Mintel Financial Confidence Tracker, January 2016-June 2018
                                                  • Retail sector continues to grow during a tough period
                                                    • Figure 19: Annual % change in all UK retail sales (ex-fuel), by value and volume, Jan 2016-April 2018
                                                • Market Size and Forecast

                                                  • Further double-digit growth for the online sector in 2017
                                                    • Figure 20: All online sales and forecast, 2013-23
                                                    • Figure 21: All online sales and forecast, at current and constant prices, 2013-23
                                                  • Online accounts for a sixth of UK retail
                                                    • Figure 22: Online as a % of all UK retail sales, 2008-17
                                                  • Online claims its greatest share in November
                                                    • Figure 23: Online retail sales as % of all retail sales, non-seasonally adjusted, January 2015-Apr 2018
                                                  • Whilst share peaks in November, sales peak in December
                                                    • Figure 24: Average weekly value of retail sales online, non-seasonally adjusted, January 2015-April 2018
                                                  • Forecast methodology
                                                  • Market Segmentation

                                                    • Online sales – Stores vs online pure players
                                                        • Figure 25: Online pure players’ and store-based retailers’ share of all online sales, 2008-18 (May)
                                                        • Figure 26: Online pure players’ and store-based retailers’ share of all online sales, 20014-18 (May)
                                                      • Online sales by type of retailer chart
                                                        • Figure 27: Online sales by type of retailers, 2017
                                                        • Figure 28: Online share of major retail sectors, 2017
                                                      • Home shopping
                                                        • Figure 29: Online sales as proportion all non-store retailers’ sales, 2008-17
                                                      • High street vs online
                                                        • Figure 30: Growth in sales, non-store retailers vs store-based retailers, 2008-17
                                                      • Forecasts
                                                        • Store-based retailers
                                                          • Figure 31: Store based retailers: online sales and forecast 2013-23
                                                          • Figure 32: Store-based retailers: online sales and forecast (inc VAT), in current and constant prices, 2013-23
                                                        • Pure players
                                                          • Figure 33: Online pure players: sales and forecast, 2013-23
                                                          • Figure 34: Online pure players: sales and forecast (inc VAT), in current and constant prices, 2013-23
                                                        • Market segmentation by product
                                                          • Figure 35: Online sales by product, 2017
                                                        • Digital spending
                                                          • Books – A return to hard copy
                                                            • Figure 36: The book market, 2013-18
                                                            • Figure 37: E-books as a proportion of all book sales, 2013-18
                                                          • Music – Growth from streaming rather than digital
                                                            • Figure 38: Spending on recorded music, 2012-17
                                                            • Figure 39: Spending on recorded music, by format, 2012-17
                                                          • Video another sector switching to streaming
                                                            • Games
                                                              • The total download market
                                                                • Figure 40: The digital download market, 2017
                                                            • The Consumer – What You Need to Know

                                                              • Nine in 10 purchased products online in the past year
                                                                • Almost half of online shoppers collected products in the past year
                                                                  • Clothing, footwear and accessories most popular online
                                                                    • Smartphone purchasing growing, particularly amongst 16-34s
                                                                      • Voice commerce has potential but needs to avoid the ‘gimmick’ tag
                                                                        • More shop with online-only retailers than multi-channel retailers
                                                                          • Amazon is fostering an ecosystem through Prime and its consumer electronics
                                                                            • Wide range and low prices staples of online retailing
                                                                              • A majority are concerned about the level of data collected by retailers
                                                                              • Who Buys Online and Who is Driving Growth?

                                                                                • Nine in 10 bought online in the past year
                                                                                  • Figure 41: All online retail users, by age, April 2018
                                                                                • Market being driven by encouraging users to bring more of their shopping online
                                                                                  • Figure 42: Change in online shopping use, April 2018
                                                                                • Young males most likely to have increased their levels of online shopping
                                                                                    • Figure 43: Change in online shopping use, by age and gender, April 2018
                                                                                • Products Purchased Online

                                                                                  • Fashion the most popular online purchase
                                                                                    • Figure 44: Products purchased online in the past year, April 2018
                                                                                  • Demographic comparisons
                                                                                    • Figure 45: Products purchased online in the past year, by gender, April 2018
                                                                                    • Figure 46: Products purchased online in the past year, by age, April 2018
                                                                                  • Female online shoppers have a wider repertoire of purchases online
                                                                                    • Figure 47: Repertoire of product categories purchased online in the past year, by age and gender, April 2018
                                                                                • Devices Used to Purchase Online

                                                                                  • Laptops/desktops remain the most used devices, but smartphones are catching up quickly
                                                                                    • Figure 48: Devices used to shop online in the past 12 months, April 2018
                                                                                    • Figure 49: Trend data: devices used to shop online, April 2017 and April 2018
                                                                                  • Younger consumers far more likely to shop by mobile
                                                                                    • Figure 50: Devices used to shop online in the past 12 months, by age, April 2018
                                                                                • Interest in and Attitudes towards Voice Commerce

                                                                                    • One in 10 households have a personal assistant
                                                                                      • Figure 51: Ownership of smart voice-controlled speakers, March 2018
                                                                                    • Amazon has a clear first-mover advantage
                                                                                      • Figure 52: Brand ownership of smart voice-controlled speakers, March 2018
                                                                                    • There is work to be done to overcome the ‘gimmick’ label
                                                                                        • Figure 53: Attitudes towards voice-commerce, April 2018
                                                                                        • Figure 54: Attitudes towards voice commerce, April 2018
                                                                                    • How They Receive Online Purchases

                                                                                      • Almost half of online shoppers have collected purchases
                                                                                        • Figure 55: Delivery methods used in the past 12 months, April 2018
                                                                                      • Younger consumers more likely to collect
                                                                                        • Figure 56: Detailed delivery methods used in the past 12 months, April 2018
                                                                                        • Figure 57: Detailed delivery methods used in the past 12 months, by age, April 2018
                                                                                      • Most consumers stick to one delivery method
                                                                                        • Figure 58: Repertoire of delivery methods used in the past 12 months, by age, April 2018
                                                                                    • Online and the High Street

                                                                                        • More online shoppers use online-only retailers than those with stores
                                                                                          • Figure 59: Type of retailer shopped with online in the past year, April 2018
                                                                                        • The effect of online growth on the high street
                                                                                            • Figure 60: Attitudes toward online’s effect on the high street, April 2018
                                                                                        • Retailers Used

                                                                                          • Nine in 10 online shoppers used Amazon in the past year
                                                                                            • Figure 61: Online-only and multi-channel retailers shopped with online in the past year, April 2018
                                                                                            • Figure 62: Retailers shopped with in the past 12 months, April 2018
                                                                                          • Newer entrants to the market appealing to younger consumers
                                                                                              • Figure 63: Retailers shopped with in the past 12 months, by age and socio-economic group, April 2018
                                                                                            • Multi-channel shoppers show a broader repertoire
                                                                                              • Figure 64: Repertoire of online-only and multi-channel retailers shopped with in the past year, April 2018
                                                                                          • Amazon: Prime and Consumer Electronics

                                                                                              • A quarter of consumers are now Amazon Prime members
                                                                                                  • Figure 65: Membership of Amazon Prime, March 2017-18
                                                                                                • Two thirds of 16-34s have some experience with Prime
                                                                                                    • Figure 66: Membership of Amazon Prime, March 2017-18
                                                                                                  • The Amazon ecosystem
                                                                                                      • Figure 67: Amazon services used in the past year, March 2018
                                                                                                      • Figure 68: Amazon device ownership, by Prime membership status, March 2018
                                                                                                    • Prime membership translates into greater purchasing
                                                                                                        • Figure 69: Purchases made via Amazon, by Prime membership status, March 2018
                                                                                                    • What is Important When Choosing Where to Shop?

                                                                                                      • Wide range a must for those trading online
                                                                                                        • Figure 70: Importance of factors when choosing where to shop online, April 2018
                                                                                                        • Figure 71: Select factors which were selected as being “extremely important”, by age, April 2018
                                                                                                      • Free returns drive appeal
                                                                                                        • Figure 72: TURF analysis – Online retailing, May 2018
                                                                                                    • Attitudes towards Data and Buying Online

                                                                                                      • Half of consumers feel the level of data retailers collect is a concern
                                                                                                          • Figure 73: Attitudes towards data collection and shopping online, April 2018
                                                                                                          • Figure 74: Agreement with statements around data collection and shopping online, by generation, April 2018
                                                                                                        • Clear communication about the use of data could ease concerns
                                                                                                          • Figure 75: Attitudes towards data sharing, December 2017
                                                                                                          • Figure 76: Companies consumers would share more data with in exchange for incentives, December 2017
                                                                                                      • Key Players – What You Need to Know

                                                                                                        • Amazon dominant
                                                                                                          • eBay second, but the gap with Amazon is widening
                                                                                                            • Tesco downsizing
                                                                                                              • Not as big as rumour would suggest
                                                                                                                • Amazon brand in rude health
                                                                                                                  • Online players continue to look to make the shopping experience ‘frictionless’
                                                                                                                  • Leading Online Retailers

                                                                                                                      • Amazon and eBay
                                                                                                                        • Tesco and Sainsbury’s
                                                                                                                          • John Lewis
                                                                                                                            • Mail order companies
                                                                                                                              • Fast-growing pure players
                                                                                                                                • Figure 77: UK: Top 30 leading online retailers, 2015/16-2017/18
                                                                                                                            • Market Shares

                                                                                                                              • Amazon accounts for just under a quarter of online retail in the UK
                                                                                                                                • Figure 78: Leading retailers share of all online sales, 2017
                                                                                                                                • Figure 79: Leading retailers: share of all online sales, 2015-17
                                                                                                                            • Brand Research

                                                                                                                                • What you need to know
                                                                                                                                  • Brand map
                                                                                                                                    • Figure 80: Attitudes towards and usage of selected brands, November 2017-May 2018
                                                                                                                                  • Key brand metrics
                                                                                                                                    • Figure 81: Key metrics for selected brands, November 2017-May 2018
                                                                                                                                  • Brand attitudes: innovation driving ASOS
                                                                                                                                    • Figure 82: Attitudes, by brand, November 2017-May 2018
                                                                                                                                  • Brand personality: Amazon, eBay and Ikea lead in the fun stakes
                                                                                                                                    • Figure 83: Brand personality – Macro image, November 2017-May 2018
                                                                                                                                  • Premium position for John Lewis
                                                                                                                                    • Figure 84: Brand personality – Micro image, November 2017-May 2018
                                                                                                                                  • Brand analysis
                                                                                                                                    • Amazon: excelling in the experience stakes
                                                                                                                                      • ao.com: low usage impacting perceptions
                                                                                                                                        • Argos: universally known but work needed on the experience
                                                                                                                                          • ASOS: younger consumers driving a positive brand image
                                                                                                                                            • Boots: high trust levels
                                                                                                                                              • Currys PC World: lacking trust and customer experience
                                                                                                                                                • Debenhams: improvement needed in the customer experience
                                                                                                                                                  • eBay: seen as innovative and trustworthy
                                                                                                                                                    • Ikea: brand perception strongest with younger consumers
                                                                                                                                                      • John Lewis: a premium position despite the price match
                                                                                                                                                        • M&S: a strong brand that has lost its cutting edge
                                                                                                                                                          • Next: accessible but fun
                                                                                                                                                            • Shop Direct – Very & Littlewoods: a tale of two halves
                                                                                                                                                            • Launch Activity and Innovation

                                                                                                                                                              • Returns and deliveries
                                                                                                                                                                • Making returns as convenient as deliveries
                                                                                                                                                                  • Amazon poised to launch its own delivery service
                                                                                                                                                                    • Bus depots as delivery hubs
                                                                                                                                                                      • Amazon and Volvo in unique test drive initiative
                                                                                                                                                                        • Sainsbury’s trialling zero emission bikes for grocery deliveries
                                                                                                                                                                          • New e-commerce venture
                                                                                                                                                                            • Lidl to launch online grocery service in the UK?
                                                                                                                                                                              • Innovative app
                                                                                                                                                                                • Cashing in on unwanted clothes
                                                                                                                                                                                  • Augmented and virtual reality
                                                                                                                                                                                    • Nike using Facebook Messenger’s new AR try-and-buy tool
                                                                                                                                                                                      • Argos launches augmented reality feature on its mobile app
                                                                                                                                                                                        • Purchasing options
                                                                                                                                                                                          • Try before you buy
                                                                                                                                                                                          • Advertising and Marketing Activity

                                                                                                                                                                                            • Online retail advertising spend up for a third consecutive year in 2017
                                                                                                                                                                                              • Figure 85: UK online retail: recorded above-the-line, online display and direct mail total advertising expenditure, 2014-17
                                                                                                                                                                                            • eBay rebranding itself into a shopping destination
                                                                                                                                                                                              • Amazon puts fashion and delivery in the spotlight
                                                                                                                                                                                                • Notonthehighstreet Christmas campaign
                                                                                                                                                                                                  • Ocado the leading online supermarket/grocer/food retail advertiser
                                                                                                                                                                                                    • Pretty Little Thing nationwide taxi TV advertising campaign
                                                                                                                                                                                                      • Party with the Porters
                                                                                                                                                                                                        • Figure 86: Leading UK online retailers: recorded above-the-line, online display and direct mail total advertising expenditure, 2014-17
                                                                                                                                                                                                      • Over half of total advertising spend channelled through TV
                                                                                                                                                                                                        • Figure 87: UK online retail: recorded above-the-line, online display and direct mail total advertising expenditure, by media type, 2014-17
                                                                                                                                                                                                      • Nielsen Ad Intel coverage
                                                                                                                                                                                                      • Amazon.com

                                                                                                                                                                                                          • What we think
                                                                                                                                                                                                            • Geographical expansion
                                                                                                                                                                                                              • Prime
                                                                                                                                                                                                                • Marketplace
                                                                                                                                                                                                                  • AWS
                                                                                                                                                                                                                    • Profitability
                                                                                                                                                                                                                      • What next?
                                                                                                                                                                                                                        • Food
                                                                                                                                                                                                                          • Clothing
                                                                                                                                                                                                                            • Electricals and others
                                                                                                                                                                                                                              • Company background
                                                                                                                                                                                                                                • Company performance
                                                                                                                                                                                                                                  • Published sales and total sales volumes
                                                                                                                                                                                                                                      • Figure 88: Amazon: sales breakdown by source of income, 2015-17
                                                                                                                                                                                                                                      • Figure 89: Amazon: sales breakdown by source of income, 2017
                                                                                                                                                                                                                                    • First quarter 2018
                                                                                                                                                                                                                                      • Gross merchandise volume (GMV)
                                                                                                                                                                                                                                          • Figure 90: Amazon: estimated group gross merchandise volume, 2015-17
                                                                                                                                                                                                                                        • GMV by country
                                                                                                                                                                                                                                          • Figure 91: Amazon.com Inc: group financial performance, 2013-17
                                                                                                                                                                                                                                        • UK sales by product
                                                                                                                                                                                                                                          • Figure 92: Amazon UK: estimated sales by product, 2017
                                                                                                                                                                                                                                        • Retail offering
                                                                                                                                                                                                                                        • AO World

                                                                                                                                                                                                                                            • What we think
                                                                                                                                                                                                                                              • New markets on the horizon?
                                                                                                                                                                                                                                                • New categories for all markets
                                                                                                                                                                                                                                                  • Addressing the growth in m-commerce
                                                                                                                                                                                                                                                    • Recycling facility provides competitive edge
                                                                                                                                                                                                                                                      • Company background
                                                                                                                                                                                                                                                        • Company performance
                                                                                                                                                                                                                                                          • Figure 93: AO World Plc: group financial performance, 2013/14-2017/18
                                                                                                                                                                                                                                                          • Figure 94: AO World Plc: UK turnover breakdown by segment, 2016/17 and 2017/18
                                                                                                                                                                                                                                                        • Retail offering
                                                                                                                                                                                                                                                        • Argos

                                                                                                                                                                                                                                                            • What we think
                                                                                                                                                                                                                                                              • Argos in Asda supermarkets
                                                                                                                                                                                                                                                                • Bolstering tech team to keep ahead of the competition
                                                                                                                                                                                                                                                                  • Beefed up market-leading Fast Track home delivery service
                                                                                                                                                                                                                                                                    • Local Sainsbury's collection points
                                                                                                                                                                                                                                                                      • Co-branded ventures bringing Argos and Sainsbury’s closer together
                                                                                                                                                                                                                                                                        • Company background
                                                                                                                                                                                                                                                                          • Company performance
                                                                                                                                                                                                                                                                            • Figure 95: Argos: group financial performance, 2013/14-2017/18
                                                                                                                                                                                                                                                                            • Figure 96: Argos: outlet data, 2013/14-2017/18
                                                                                                                                                                                                                                                                          • Retail offering
                                                                                                                                                                                                                                                                          • ASOS

                                                                                                                                                                                                                                                                              • What we think
                                                                                                                                                                                                                                                                                • Positive and empowering approach
                                                                                                                                                                                                                                                                                  • Try before you buy
                                                                                                                                                                                                                                                                                    • Expansion and innovations
                                                                                                                                                                                                                                                                                      • Leisurewear launches
                                                                                                                                                                                                                                                                                        • Mobile coming to the fore
                                                                                                                                                                                                                                                                                          • Seamless service
                                                                                                                                                                                                                                                                                            • Company background
                                                                                                                                                                                                                                                                                              • Company performance
                                                                                                                                                                                                                                                                                                  • Figure 97: ASOS: group financial performance, 2012/13-2016/17
                                                                                                                                                                                                                                                                                                • Retail offering
                                                                                                                                                                                                                                                                                                • Dixons Carphone

                                                                                                                                                                                                                                                                                                    • What we think
                                                                                                                                                                                                                                                                                                      • A shift in focus towards delivery
                                                                                                                                                                                                                                                                                                        • Reducing barriers to online purchasing
                                                                                                                                                                                                                                                                                                          • Extending online ranges
                                                                                                                                                                                                                                                                                                            • Company background
                                                                                                                                                                                                                                                                                                              • Figure 98: Dixons Carphone: retail brands, by country, 2018
                                                                                                                                                                                                                                                                                                            • Company performance
                                                                                                                                                                                                                                                                                                              • Figure 99: Dixons Carphone: group financial performance, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                            • Online performance
                                                                                                                                                                                                                                                                                                              • Figure 100: Dixons Carphone: estimated online sales, 2013/14-2016/17
                                                                                                                                                                                                                                                                                                              • Figure 101: Dixons Carphone: estimated online sales, by channel, 2013/14-2016/17
                                                                                                                                                                                                                                                                                                              • Figure 102: Dixons Carphone: outlet data, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                            • Retail offering
                                                                                                                                                                                                                                                                                                            • eBay

                                                                                                                                                                                                                                                                                                                • What we think
                                                                                                                                                                                                                                                                                                                  • Marketplace
                                                                                                                                                                                                                                                                                                                    • No longer a fast-growing business
                                                                                                                                                                                                                                                                                                                      • Progress in 2017
                                                                                                                                                                                                                                                                                                                        • Shortcomings vs Amazon
                                                                                                                                                                                                                                                                                                                          • What next?
                                                                                                                                                                                                                                                                                                                            • Company background
                                                                                                                                                                                                                                                                                                                              • Company performance
                                                                                                                                                                                                                                                                                                                                • Figure 103: eBay: group gross merchandise volume, 2013-17
                                                                                                                                                                                                                                                                                                                                • Figure 104: eBay: major markets, estimated growth in GMV in local currency, 2014-17
                                                                                                                                                                                                                                                                                                                                • Figure 105: eBay Europe: sales, excluding VAT, 2015-17
                                                                                                                                                                                                                                                                                                                              • Retail offering
                                                                                                                                                                                                                                                                                                                              • John Lewis (Department Store)

                                                                                                                                                                                                                                                                                                                                  • What we think
                                                                                                                                                                                                                                                                                                                                    • A need for more flexible fulfilment options
                                                                                                                                                                                                                                                                                                                                      • Enhancements to app reflect steady shift to m-commerce
                                                                                                                                                                                                                                                                                                                                        • Home Solutions broaden range of services offered
                                                                                                                                                                                                                                                                                                                                          • JLAB helps keep finger on technology pulse
                                                                                                                                                                                                                                                                                                                                            • Company background
                                                                                                                                                                                                                                                                                                                                              • Company performance
                                                                                                                                                                                                                                                                                                                                                • Figure 106: John Lewis Plc (department store): group financial performance, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                                • Figure 107: John Lewis Plc (department store): outlet data, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                              • Retail offering
                                                                                                                                                                                                                                                                                                                                              • Next Group

                                                                                                                                                                                                                                                                                                                                                  • What we think
                                                                                                                                                                                                                                                                                                                                                    • Clawing back lost ground
                                                                                                                                                                                                                                                                                                                                                      • Next follows the trend towards personalisation
                                                                                                                                                                                                                                                                                                                                                        • Increasing range of payment options aims to drive sales growth
                                                                                                                                                                                                                                                                                                                                                          • Company background
                                                                                                                                                                                                                                                                                                                                                            • Company performance
                                                                                                                                                                                                                                                                                                                                                              • Figure 108: Next Group: group financial performance, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                                              • Figure 109: Next Group: outlet data, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                                              • Figure 110: Next Group: average active customers, 2016/17 and 2017/18
                                                                                                                                                                                                                                                                                                                                                            • Retail offering
                                                                                                                                                                                                                                                                                                                                                            • Ocado Group

                                                                                                                                                                                                                                                                                                                                                                • What we think
                                                                                                                                                                                                                                                                                                                                                                  • Ocado and Waitrose
                                                                                                                                                                                                                                                                                                                                                                    • Putting it in perspective
                                                                                                                                                                                                                                                                                                                                                                      • Capacity
                                                                                                                                                                                                                                                                                                                                                                        • Solutions – The second growth arm
                                                                                                                                                                                                                                                                                                                                                                          • What next?
                                                                                                                                                                                                                                                                                                                                                                            • Company background
                                                                                                                                                                                                                                                                                                                                                                              • Company performance
                                                                                                                                                                                                                                                                                                                                                                                • Figure 111: Ocado Group plc: group financial performance, 2011/12-2016/17
                                                                                                                                                                                                                                                                                                                                                                              • Retail offering
                                                                                                                                                                                                                                                                                                                                                                              • Otto Group (Multichannel Retail)

                                                                                                                                                                                                                                                                                                                                                                                  • What we think
                                                                                                                                                                                                                                                                                                                                                                                    • Marketplace development widening product choice and attracting new customers
                                                                                                                                                                                                                                                                                                                                                                                      • ABOUT YOU doubles sales
                                                                                                                                                                                                                                                                                                                                                                                        • ‘Conversational commerce’
                                                                                                                                                                                                                                                                                                                                                                                          • Sports lifestyle hub
                                                                                                                                                                                                                                                                                                                                                                                            • Parcel shops, micro depots and trunk delivery
                                                                                                                                                                                                                                                                                                                                                                                              • Using augmented reality technology to make choosing the right product easier
                                                                                                                                                                                                                                                                                                                                                                                                • Otto Now expanded to include over 100 products
                                                                                                                                                                                                                                                                                                                                                                                                  • Company background
                                                                                                                                                                                                                                                                                                                                                                                                    • Company performance
                                                                                                                                                                                                                                                                                                                                                                                                        • Figure 112: Otto Group (Multichannel Retail): group sales performance, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                                                                                        • Figure 113: Otto Group: major brands within the Multichannel Retail segment, 2017/18
                                                                                                                                                                                                                                                                                                                                                                                                      • Retail offering
                                                                                                                                                                                                                                                                                                                                                                                                      • Shop Direct Group

                                                                                                                                                                                                                                                                                                                                                                                                          • What we think
                                                                                                                                                                                                                                                                                                                                                                                                            • Change at the top
                                                                                                                                                                                                                                                                                                                                                                                                              • Where next for Littlewoods?
                                                                                                                                                                                                                                                                                                                                                                                                                • Very restricting its appeal
                                                                                                                                                                                                                                                                                                                                                                                                                  • What next?
                                                                                                                                                                                                                                                                                                                                                                                                                    • Company background
                                                                                                                                                                                                                                                                                                                                                                                                                      • Very vs Littlewoods
                                                                                                                                                                                                                                                                                                                                                                                                                        • Company performance
                                                                                                                                                                                                                                                                                                                                                                                                                          • Figure 114: Shop Direct Group: group financial performance, 2012/13-2017/18
                                                                                                                                                                                                                                                                                                                                                                                                                        • Retail offering
                                                                                                                                                                                                                                                                                                                                                                                                                        • Tesco

                                                                                                                                                                                                                                                                                                                                                                                                                            • What we think
                                                                                                                                                                                                                                                                                                                                                                                                                              • Closing its non-food website
                                                                                                                                                                                                                                                                                                                                                                                                                                • Same-day delivered groceries
                                                                                                                                                                                                                                                                                                                                                                                                                                  • Tackling wastage through over ordering
                                                                                                                                                                                                                                                                                                                                                                                                                                    • Exploring new delivery methods
                                                                                                                                                                                                                                                                                                                                                                                                                                      • Company background
                                                                                                                                                                                                                                                                                                                                                                                                                                        • Company performance
                                                                                                                                                                                                                                                                                                                                                                                                                                          • Figure 115: Tesco Plc: group financial performance, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                                                                                                                          • Figure 116: Tesco Plc: outlet data, 2013/14-2017/18
                                                                                                                                                                                                                                                                                                                                                                                                                                        • Retail offering
                                                                                                                                                                                                                                                                                                                                                                                                                                        • YNAP Group

                                                                                                                                                                                                                                                                                                                                                                                                                                            • What we think
                                                                                                                                                                                                                                                                                                                                                                                                                                              • Richemont takeover completed
                                                                                                                                                                                                                                                                                                                                                                                                                                                • YNAP focuses on m-commerce…
                                                                                                                                                                                                                                                                                                                                                                                                                                                  • …and expands product range
                                                                                                                                                                                                                                                                                                                                                                                                                                                    • Sustainability commitments
                                                                                                                                                                                                                                                                                                                                                                                                                                                      • Company background
                                                                                                                                                                                                                                                                                                                                                                                                                                                        • Company performance
                                                                                                                                                                                                                                                                                                                                                                                                                                                          • Figure 117: YNAP Group: group financial performance, 2014-17
                                                                                                                                                                                                                                                                                                                                                                                                                                                        • Retail offering
                                                                                                                                                                                                                                                                                                                                                                                                                                                        • Zalando

                                                                                                                                                                                                                                                                                                                                                                                                                                                            • What we think
                                                                                                                                                                                                                                                                                                                                                                                                                                                              • Complementary beauty category offering
                                                                                                                                                                                                                                                                                                                                                                                                                                                                • Pop-up an opportunity to raise awareness of the online style advisory service
                                                                                                                                                                                                                                                                                                                                                                                                                                                                  • Growing role of personalisation
                                                                                                                                                                                                                                                                                                                                                                                                                                                                    • Scaling up logistics network and order fulfilment options
                                                                                                                                                                                                                                                                                                                                                                                                                                                                      • Rising fulfilment costs a sign of things to come?
                                                                                                                                                                                                                                                                                                                                                                                                                                                                        • Local and regional-specific payment options boosting basket size and conversion rates
                                                                                                                                                                                                                                                                                                                                                                                                                                                                          • Company background
                                                                                                                                                                                                                                                                                                                                                                                                                                                                            • Company performance
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                • Figure 118: Zalando: group financial performance, 2013-17
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                • Figure 119: Zalando: key metrics, 2015-Q1 2018
                                                                                                                                                                                                                                                                                                                                                                                                                                                                              • Retail offering
                                                                                                                                                                                                                                                                                                                                                                                                                                                                              • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                • Data sources
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  • VAT
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    • Financial definitions
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      • Abbreviations
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        • Consumer research methodology
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          • TURF analysis – Methodology
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            • Figure 120: Table - TURF analysis – Online retailing, May 2018
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        • Appendix – Market Size and Forecast

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          • Forecast methodology