Understanding the European e-commerce market

For businesses looking to take their e-commerce sales to the next level, international growth is an exciting but daunting prospect. While expanding into new regions brings with it a whole new potential customer base, it can also mean infrastructure or localisation challenges. One solution is to not look too far afield. In fact, with several large markets and proven enthusiasm for cross-border shopping throughout Europe, there are opportunities close to home.

Europe holds great potential for e-commerce businesses already in the region. The e-commerce market is thriving thanks to a growing digital audience, an established habit of buying from other EU countries, and new channels and technology making online shopping easier than ever.

The European e-commerce market size is substantial. The largest markets in Europe are the UK, Germany and France, all of which feature in the top 10 globally. But beyond established markets, there is a strong return to e-commerce growth across Europe. In 2024, the total amount of B2C European e-commerce revenue increased by 7%, rising to €842 billion.¹ As is to be expected, there are differences at a regional level. Eastern Europe saw an impressive 18% growth, while Western Europe just 6%² – although these markets were more mature to begin with.

While inflation challenges resulted in slower economic growth in 2022 and 2023, European GDP has grown as levels returned to normal ranges. But on top of this economic backdrop, one key driver of e-commerce growth in Europe is rising internet usage. As the region becomes more digitised in line with EU policies, so too does the number of online shoppers.

In the EU in 2024, 94% of people aged 16-74 years had used the internet within the last 12 months – and 77% of them bought or ordered goods or services online. This was a rise of 17 percentage points in the last 10 years (up from 59% of internet users in 2014).³

While the range of goods being ordered is wide, there are key categories which stand out from the rest. Across the EU, clothes, shoes and accessories are the most common online purchase, with almost half of EU internet users buying this category,⁴ followed by cosmetics, beauty and wellness products; furniture, home accessories and gardening products; and sports goods.

What’s particularly important in driving e-commerce growth in Europe is the demand for cross-border shopping. A third of online shoppers in the EU buy from businesses in other EU countries.⁵ And this market reached 275 billion euros in 2024,⁶ accounting for over a third of total e-commerce revenue in the EU (36%).⁷ Again, the picture varies across the region. For example, Germany had 34% cross-border e-commerce revenue share in 2025, while Italy had 23%.⁸

As well as being a huge market, Europe offers several advantages to exporters already based in the region.

Simpler shipping within the EU: EU businesses shipping to other EU markets can ship without border restrictions – or duties and taxes. Compared with shipping further afield, this means a layer of documentation, administration and potential expense is removed from the process. As a result, many businesses may find it easier to expand regionally first before moving onto other overseas markets.

Fast deliveries: The proximity of EU countries to each other, combined with the absence of customs barriers, means shipping is fast. Deliveries to other countries in the EU can be made almost as quickly (if not as quickly) as those to customers in domestic markets, enhancing competitiveness and potentially proving a more compelling option for customers in the region than businesses located in non-EU countries.

Familiarity: One of the keys to success when expanding internationally is understanding the market. While European countries can be very different from each other, there are also some inherent similarities across cultures, consumers and legal formalities that give exporters in the region an in-built advantage. It also means businesses aiming to expand to new markets can test out the water in surroundings they may find more comfortable than those further afield.

Market maturity, infrastructure and consumer behaviour all influence e-commerce levels across this large and diverse region. In Ireland, nine in 10 internet users shopped online in 2023, compared to just five in 10 in Bulgaria. Other countries with a large proportion of online shoppers include the Netherlands (94% of internet users shop online), Denmark, Norway and the United Kingdom (all 91%).¹²

In terms of e-commerce revenue share, Ireland stands out with a 33% share, followed by Czechia at 30% and Belgium at 29%.¹³ And when it comes to e-commerce sectors as a proportion of GDP, the UK leads the way with 9.3%.¹⁴

The UK is also a key country for cross-border shopping in Europe. It is one of the most popular countries to make cross-border online purchases from, along with Germany and France^.15

When it comes to how consumers prefer to do their shopping online, there is a clear winner: on their phones. The number of smartphone users in Europe has continuously increased over recent years and is forecast to continue growing between 2024 and 2029 by a total of 63.7 million users (+9.2 percent).²¹

This behaviour remains the same for cross-border purchases – in 2022, over half of people surveyed used mobile devices to shop internationally.²² So it’s important to make sure your website is optimised for mobile usage.

While the return to e-commerce growth in Europe paints a positive picture, there are factors to consider for businesses looking to expand across borders. Inflation and economic uncertainty are influencing customer purchasing decisions, while regulation and compliance pressures are impacting business operations.

Cross-border shipping naturally raises more potential challenges than domestic. Some of the main setbacks include having shipments belayed in customs, meeting customs regulations and Harmonised System Codes.²⁷ For advice on navigating these requirements, read more about how to ship within the EU or use the FedEx International Shipping Assist Lite tool to identify a Harmonised System Code for your international shipment with or without a FedEx account.

When it comes to consumers, some of the main complaints raised around cross-border online shopping is around delivery speed, damaged packages or items, delivery locations and tracking.²⁸ Businesses looking to export internationally should consider choosing delivery partners that offer both speed and delivery infrastructure that works well for customers, whether that’s providing effective tracking or having retail pick-up options alongside home delivery.

Increasing concerns around sustainability are making this an important decision-making factor for shoppers in Europe. In Romania, for example, 70% of shoppers would be willing to pay more for an ethical or sustainable product.³¹ When it comes to the environmental impact of online deliveries, one in 10 consumers would opt for slower but more environmentally friendly shipping options.³² Choosing re-usable packaging could be a win for businesses here, or looking to delivery partners with sustainable shipping options.

The e-commerce landscape in Europe is evolving thanks to new digital technologies and customer habits affecting shopping behaviours. The rise of AI-powered e-commerce tools, new shopping platforms such as social media and live commerce, sustainable logistics, and mobile payments are reshaping the experience for customers and businesses alike – and creating untapped growth opportunities. For example, in 2022 revenue from social commerce in Europe exceeded 18 billion U.S. dollars, a value expected to be 2.5 times greater by 2027.³³

AI technology is reshaping the customer experience, creating e-commerce tools that allow for easier, simpler online shopping. But they can also have a positive impact on your business, too. AI-powered shopping predictions based on your customers’ shopping history, for example, can give tailored recommendations – and help cut down costly e-commerce returns. Or try AI-powered customer service agents, often built into e-commerce platforms, which can help free up your teams’ time.

AI tools are already being adopted by customers. Some of the most regularly used shopping technologies in Europe include:

• Virtual shopping experiences (15% of people use regularly)³⁴
• AI-generated shopping lists (15% of people use regularly)
• AI shopping assistants (14% of people use regularly)

The European e-commerce market combines strong growth with market familiarity. While there are potential challenges from the economic outlook and regulation, the established appetite for cross-border shopping, plus the exciting opportunities arising from new technologies and shopping channels, make it an ideal chance for businesses already in the region to test the waters when it comes to international expansion.