The European e-commerce market is set to experience a significant transformation over the next five years. According to recent forecasts by Forrester, the Europe-5 markets—comprising France, Germany, Italy, Spain, and the United Kingdom—are poised for robust online retail growth. This evolution is underpinned by improving economic conditions, shifts in consumer behavior, and strategic investments in omnichannel strategies. In this article, we examine the forecasted trends, dive into key statistics, and explore the strategic implications for retailers.
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Market Growth and Projections

Forrester’s analysis predicts that online retail sales across the Europe-5 markets will increase from €389 billion in 2024 to €565 billion by 2029. This represents a compound annual growth rate (CAGR) of 7.8%, highlighting a shift from the post-pandemic emphasis on in-store shopping to a sustained digital buying trend. As online channels continue to expand, they are expected to account for nearly 21% of all retail sales by 2029, up from 16% in 2024. In contrast, offline retail sales are forecast to grow at a much slower pace—with a CAGR of only 1.7%—underscoring the increasing dominance of e-commerce.
In addition, total retail sales across these markets are projected to reach approximately €2.7 trillion by 2029. This overall growth is driven by both the expansion of online channels and the gradual recovery of offline retail through enhanced omnichannel strategies.
Key Drivers Behind the Growth
Several factors are expected to fuel this dynamic growth in e-commerce:
- Improved Economic Conditions:
Declining inflation, reduced interest rates, and rising real disposable incomes are creating a positive economic environment. These improvements, along with a rebound in tourism, are setting the stage for increased consumer spending. - Consumer Spending Shifts:
Forrester’s forecast indicates that two-thirds of the anticipated e-commerce growth will come from an increase in spending per online buyer. Meanwhile, one-third will be driven by an expanding base of online shoppers. This dual dynamic ensures that both new and existing customers will contribute significantly to the sector’s expansion. - Marketplace and Cross-Border Expansion:
Global players like AliExpress, SHEIN, and Temu are intensifying their presence in Europe, contributing to cross-border e-commerce growth. This trend is further accelerating the digitization of retail as consumers benefit from a wider selection of products and competitive pricing. - Omnichannel Strategies:
Traditional retailers are increasingly blending physical and digital experiences. By integrating online platforms with brick-and-mortar stores—for example, through click-and-collect services and efficient returns management—brands are creating seamless shopping experiences that enhance overall customer satisfaction.
Key Numbers at a Glance
To put the transformation into perspective, here are the critical statistics driving the narrative:
- Overall E-Commerce Growth:
- 2024: €389 billion
- 2029: €565 billion
- CAGR: 7.8%
- Retail Share: Increasing from 16% to nearly 21% of total retail sales
- Country-Specific Projections:
- United Kingdom:
- Online sales expected to grow from £130 billion (≈€152 billion) in 2024 to £176 billion (≈€207 billion) in 2029
- E-commerce share of total retail sales rising from 27% to 32%
- Germany:
- Online sales forecast to increase from €97 billion in 2024 to €146 billion in 2029
- E-commerce penetration growing from 16% to 21%
- France:
- Online sales projected to grow from €73 billion in 2024 to €106 billion in 2029
- E-commerce share climbing from 14% to 17%
- United Kingdom:
- Total Retail Sales:
- Forecasted to reach approximately €2.7 trillion by 2029
Strategic Implications for Retailers

As the European retail landscape evolves, retailers must adapt their strategies to capitalize on these trends:
- Digital Transformation:
Investing in advanced digital platforms and data analytics is critical. Enhanced personalization and better inventory management will enable retailers to meet rising consumer expectations and improve operational efficiency. - Omnichannel Integration:
The integration of physical and online channels will be a defining factor for success. Retailers need to ensure that their brick-and-mortar stores complement their digital initiatives, providing seamless services such as in-store pick-up and hassle-free returns. - Cross-Border Opportunities:
With the increasing influence of global marketplaces, local retailers should consider expanding their reach to international markets, leveraging localized strategies and diverse product offerings to capture a broader customer base.
Conclusion
The European e-commerce industry is set for significant growth in the next five years, marked by a shift in consumer preferences and robust economic fundamentals. With online retail sales forecast to surge from €389 billion to €565 billion and e-commerce’s share of total retail sales climbing from 16% to 21%, retailers must pivot towards digital-first strategies. By investing in digital transformation, integrating omnichannel experiences, and leveraging cross-border opportunities, businesses can position themselves to thrive in this rapidly evolving market.