10 things your business should know about ecommerce

If you’re not already doing it, selling online could be a game-changer for your business, such are the commercial opportunities it offers. Worth £127bn in 2024 (source: The Federation of Small Businesses), online now makes up more than 25% of UK retail sales, when that figure was only 3.3% in 2007 (source: ONS).

About 52m people in the UK (77% of the population) were expected to make a purchase online in 2025, confirming the UK’s place as one of Europe’s most digitally active consumer markets. The ONS predicts that UK online retail sales will grow by an average of 2.4% a year to reach £145bn by 2030, up from an estimated £128.8bn in 2025.

If you want to set up an ecommerce business or your business wants to boost its revenue by selling online, here are 10 things you should know.

1 Selling online offers many advantages

It gives you access to a much bigger customer base, whether people living in other parts of the UK, specific territories overseas or countries worldwide. An estimated 2.7bn people (a third of the global population) buy online. Selling online can take less effort and be much cheaper than selling offline. You can trade 24/7, 365 days a year. There really is no need to close.

2 Scaling up your online sales is cost-effective

Technology makes it achievable and cost-effective to achieve further growth by scaling up your online sales, using tactics that have already served you well or new ones. Without necessarily having to commit lots of additional time or money, you can add new products/services and target new customers/countries

3 You can pick from several ecommerce channels

You can sell via your own website (as long as it can accept payments and process orders) or create a separate ecommerce website. Site-building solutions such as Shopify, Wix, WooCommerce and Squarespace can enable you to do this cost-effectively and with limited know-how. Budget permitting, you could have a website created for you, or have ecommerce functionality added to your existing website. Many UK businesses also sell via online marketplaces (eg Amazon, eBay, Etsy, etc) and social media platforms (eg Facebook Marketplace, TikTok Shop and Instagram Shopping).

4 A mix of ecommerce channels could maximise your sales

The ecommerce channels you choose should be determined by what you are selling, who you want to sell to, associated costs and your knowledge/skill. Many businesses take a hybrid approach, combining marketplaces (which offer great reach), with social platforms (which can provide great engagement) and their own website (which gives them total control).

Need to know! Online marketplaces often charge listing fees, commission (5%–15%) and subscription costs (£20–£25 a month). Find out how much you will be charged before you start selling on marketplaces and factor it in when setting your prices.

5 You should follow these steps before you start selling online

• Decide your ecommerce target customers

  You must know who you want to sell to, what they want, how they buy and how much they will pay. If necessary, carry out detailed market research.

• Research your ecommerce competitors

  Find out what they sell, how they sell it, how much they charge and whether they offer any discounts or special offers. Think of ways to be better.

• Choose your ecommerce channels

  Could be your own website, a separate ecommerce website, online marketplaces or social media websites. A mix is likely to provide the answer.

• Decide what you will sell and set your prices

  Knowledge of your target customers should guide your product/service choices. You do not have to charge less because you’re selling online. Bear in mind your competitor prices, your costs, customer expectations and delivery.

6 Secure payment options and reliable shipping are a must

You need to provide secure, easy and convenient payment options, as well as reliable, fairly priced shipping. It helps to build trust, which can encourage customers to buy more. Get it wrong and it can lead to cancelled orders and negative reviews online. Payment options include debit/credit cards, PayPal, Apple Pay, Google Pay, Buy Now, Pay Later, bank transfer, Direct Debit, etc. Shipping can include flat rates, higher rates for quicker deliveries, free shipping thresholds, alternative carrier rates and local delivery or pickup.

7 Digital marketing is key to driving your online sales

Customers need to know you are there, as well as what you sell and why they should buy it from you. A mix of digital marketing channels and strategies can attract and retain ecommerce customers, including SEO (so your web pages rank high up in search engine results pages), digital advertising (including pay-per-click ads on Google Ads and Facebook Ads), social media (including paid social), email and mobile marketing.

8 Continually analysing key metrics can maximise your sales

Closely assess the analytics data page in the back office of your website and/or other ecommerce channels so you can better understand your performance. Google Analytics could also give you a deeper understanding of your website’s performance. Measure what matters. Key metrics include bounce rate (ie percentage of visitors who land on a webpage and soon leave without any further activity), conversion rate (ie how effectively your site turns visitors into buyers), total sales revenue, average order value, customer acquisition cost, customer lifetime value, repeat purchase rate, cart abandonment rate, refund and return rate, etc.

9 There are proven ways to build customer loyalty online

These include offering cost-effective loyalty deals and exclusive offers, as well as rewards for referrals to others. Make returns easy and always provide great customer service. Using CRM software can help you to better understand your customers and personalise your communication with them, which can help to make them feel valued. Be honest, clear and transparent, because it helps to build trust. Sending monthly enewsletters can also enable you to reach and sell to customers. It is cheaper and easier to sell to existing customers, so look after them.

10 Selling online to customers overseas brings specific challenges

If selling from your own website or a separate ecommerce website, you need to display your prices and accept payments in other currencies. International payment gateways such as Stripe, PayPal, Worldpay, etc, can really help. All transactions should be seamless, secure and the fees shouldn’t be excessive.

You may also have to add pages in other languages to your website and work out how you will answer customer enquiries from people who don’t speak English. Your customer service must always be professional and responsive.

Use reliable couriers and realise that international shipping can add significantly to your prices for overseas customers. They may also have to pay tariffs, local taxes and customs duties, which can make your products more expensive than local alternatives, so you may need to lower your prices. Some products may be restricted, while overseas countries have their own consumer protection laws.