Country Focus: UK
Home of the 1st stamp, the 1st speeding ticket and over 500 pubs named “The Red Lion”
Before we dive into our market analysis of the United Kingdom, let’s look at some fun facts you might not have heard before.
- Some of the biggest curry lovers around, Brits have claimed Chicken Tikka, originally Indian, as their national dish. It is estimated that there are more Indian restaurants in London than in native urban centres like New Delhi or Mumbai.
- Queen Elizabeth is the longest-reigning queen in the world. On a side note: British passports are issued in her name, rendering it unnecessary for Her Majesty to possess one. Meanwhile, UK horses, donkeys, mules and zebras are required to have one.
- Llanfairpwllgwyngyll-gogerychwyrndrobwlllllandysiliogogogoch – no, we didn’t fall asleep on our keyboard. This is actually the name of a Welsh town. It’s the longest name of any city in the world.
But now, let’s talk economics.
A post-Brexit market – fortress or door to the world?
The UK may be the 80th biggest country in the world, but did you know it has the 5th largest GDP output and its capital is often referred to as the trading capital of the world? And here’s another piece of economic trivia for you:
The UK is home to 145 billionaires, which means one out of every 462,000 or so Britons is a billionaire!
For centuries, London has been seen as the trading capital of the world due to its location and openness to trade with the rest of the world. Although London is the 32nd largest city in the world in terms of population and size, Statista revealed that the capital is the second leading financial centre in the world, even after Brexit.
As lockdown restrictions eased, it wasn’t all doom and gloom – Retail Gazette revealed that the UK economy has grown by 4.8% in the second quarter of 2021. Although this figure is promising, exports to EU countries are still down from pre-pandemic levels, whilst the UK is still reliant on buying goods from the EU. That being said, figures by Pantheon Macroeconomics reported that Britain’s economy is still storming ahead of rival nations in the EU, with a 4.8% increase from April to June.
It’s also worth noting that the UK is home to a diverse range of people and, therefore, a host of different consumer tastes and needs. As a result, it is important for brands to make sure they are catering to audiences in different regions around the UK, not just focusing on the London-centric consumer.
The Ecosystem
The biggest retailers in the UK are:
- Amazon
- Currys (Dixon’s Carphone)
- Argos
- John Lewis
- Apple
- Tesco
- AO
- Shop Direct
- Richer Sounds
- Game
Statista revealed data that states the size of the CE retail market is worth an estimated £4.5 billion in revenue. This amounted to a whopping 19% share of the entire UK ecommerce market.
The UK has always been a powerhouse when it comes to its reputation for a place which welcomes innovation and it is increasingly becoming a home for many startups. Welcome to the Jungle has revealed that the UK is ‘the third largest digital sector in the world and, in 2020, technology companies attracted £14 billion in venture capital, raising more than France and Germany combined.’
Unsurprisingly, Statista reported that Amazon is the most dominant CE retailer when it comes to its share in the UK and US market, where it reportedly made £2,386,000,000 in the UK in 2019.
Media Landscape
When looking for product news, reviews, recommendations and advice, Brits turn to consumer tech media websites, such as What HiFi, Tech Radar and Which?, who offer insights into the newest products to hit the market, and any arising tech trends.
As well as turning to traditional media outlets, there has been an increase in Podcasts focusing on tech-led content. Tech sections of national newspapers have cottoned on to the trend, with Evening Standard and Financial Times both launching designated Podcast channels where they explore innovation in technology and some of the hottest products to launch. Wired’s Podcast dissects some of the most pressing issues and conversations taking place in the tech industry, whereas Podcasts like Made Tech, Open TechCast and FrequencyCast UK Tech Radio Show offer top tier reviews of gadgets and must-have products.
TV shows
For those looking to tv for inspiration, The Gadget Show is the biggest tech show on TV, ranking as YouGov’s 108th best contemporary tv programme. The show is proven to have widespread appeal, and its audience is made up of 38% millennials, 48% Gen X and 26% baby boomers.
Influencers
In the UK, studies have found that consumers are twice as likely to trust the people they follow on social media to give an honest review of a product than they are to trust the website of the company selling the product. However, numbers are still low, with just 6.1% of people saying they trust people they follow on social media to give an honest review of a product.
Despite this, there are a number of YouTubers who Brits turn to for similar reviews and product recommendations:
- Mrwhosetheboss (8.2m subscribers)
- The Tech Chap (1.12m subscribers)
- Tech Spurt (617k subscribers)
- Chigz Tech Reviews (277k subscribers)
- What Gear (90.7k subscribers)
Whilst the larger influencer outlined above require payment for similar reviews, there are a number of similar influencers who have recently reviewed Aqipa products in return for a loaned or gifted products:
What happens next?
With the Brexit agreement coming into play, there are sure to be some knock on effects for the tech industry, which will be key for Brands to consider in the UK.
A report by Welcome To The Jungle suggested that the Brexit agreement will cause a multitude of changes for the tech sector. Some of the most important include:
- More paperwork
- End of free movement
- Scientific collaborations challenged
As a result, the report advised that this is likely to affect the growth of the tech sector in the UK. Whilst it will limit free trading with European countries, it provides an opportunity for the UK tech market to become more dynamic and more attractive.
So the question is, how does this affect brands coming to the UK?
- The first, and probably biggest consideration for consumer electronic brands is the rules on importing and exporting products. The severity of increased import costs and delivery times cannot be stressed enough. As a result, consumers might turn to buying more from local/UK suppliers, rather than purchasing from bigger European companies, with 55% of UK residents agreeing with the statement that they would prefer to buy from more British brands rather than international ones, to help support the local economy.
- Consumer spending fell to a record low in August 2019, and whilst this is beginning to recover, it is also important to consider that the uncertainty of Brexit, and now the Covid-19 pandemic too, is likely to affect consumer confidence and spending in the UK.
If you have any questions, local gear guru Paul Glanville will be happy to answer them for you!
