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Fewer UK Buyers Will Engage in Cross-Border Retail Ecommerce Amid Brexit

October 21, 2020 (New York, NY) — With a hard Brexit looming, 2020 will be the peak of cross-border ecommerce penetration in the UK, according to the latest forecast from eMarketer, an Insider Intelligence company. This year, 22.8 million people in the UK will have made a cross-border ecommerce purchase, representing 46.0% of internet users and 50.2% of digital buyers.

 

Next year, that figure will decrease 7.3% to 21.1 million. We anticipate declines in the number of UK consumers making cross-border retail ecommerce purchases through the end of our forecast period in 2022.

 

We define cross-border retail ecommerce buyers as internet users ages 14 and older who have purchased goods online from a seller in a foreign country either directly or through an intermediary (i.e., marketplaces) at least once during the calendar year via any digital channel.

Heading into 2021, the ongoing Brexit negotiations remain fluid and highly uncertain. We are assuming that the UK may be initially forced into a hard Brexit, but the country will establish a free-trade agreement with the EU at some point in H1 2021. Also, we are presuming that international goods arriving in the UK will be subject to additional customs checks. This barrier will delay delivery and return times, which may dissuade some UK digital buyers from making cross-border purchases.

 

“We’re four and a half years on from the divisive Brexit vote, and there’s still no clear outcome regarding an EU trade agreement,” said Bill Fisher, eMarketer senior analyst at Insider Intelligence. “Our forecast for cross-border buyers currently errs on the side of optimism if a trade deal can be agreed upon in H1 2021. If wrangling persists into H2, continued import delays plus the higher duties imposed on foreign goods mean our forecasts could conceivably be revised further downward.”

 

Methodology

eMarketer’s forecasts and estimates are based on an analysis of quantitative and qualitative data from research firms, government agencies, media firms, and public companies, plus interviews with top executives at publishers, ad buyers, and agencies. Data is weighted based on methodology and soundness. Each eMarketer forecast fits within the larger matrix of all its forecasts, with the same assumptions and general framework used to project figures in a wide variety of areas. Regular reevaluation of available data means the forecasts reflect the latest business developments, technology trends, and economic changes.

 

About Insider Intelligence
Formed in 2020 from the combination of eMarketer and Business Insider Intelligence (BII), Insider Intelligence aims to be the world’s leading research service focused on digital transformation. Insider Intelligence enables thousands of global industry leaders to understand the critical trends and developments affecting their business in the short and long term. Each year, Insider Intelligence produces nearly 300 reports, 7,000 charts, 1,500 newsletters, and 200 forecasts across the Advertising & Marketing, Consumer Demographics, Social Media, Video, Mobile, Ecommerce & Retail, Telecoms & Technology, Financial Services, and Digital Health industries. Insider Intelligence is owned by European media giant Axel Springer S.E.

Posted on December 21, 2020.