Online Retail Market Report 2025

The online retail market size has grown rapidly in recent years. It will grow from $7.12 trillion in 2024 to $7.86 trillion in 2025 at a compound annual growth rate (CAGR) of 10.3%. The growth during the historic period can be attributed to factors such as increasing internet penetration, higher smartphone usage, a rising consumer preference for convenience, expanded access to digital payment systems, and significant investments by early e-commerce companies.

The online retail market size is expected to see rapid growth in the next few years. It will grow to $11.5 trillion in 2029 at a compound annual growth rate (CAGR) of 10%. The growth in the forecast period is expected to be driven by a rising demand for personalized shopping experiences, greater adoption of AI and machine learning technologies, increased use of voice and visual search, wider availability of same-day delivery services, and enhanced integration of augmented reality (AR) and virtual reality (VR) solutions. Key trends for this period include progress in autonomous delivery systems, innovations in generative artificial intelligence (AI), advancements in voice commerce, developments in immersive AR and VR shopping experiences, and breakthroughs in blockchain-enabled supply chain transparency.

The increasing use of digital payment systems is driving the expansion of the online retail market due to improved transaction convenience and security. Digital payment systems involve electronic methods for conducting financial transactions via the internet, mobile applications, or contactless technologies. Their rising adoption is mainly attributed to the widespread availability of smartphones, which make digital transactions more accessible and user-friendly. These systems benefit online retail by enabling fast, secure, and seamless transactions, thereby enhancing customer satisfaction. Additionally, they streamline the checkout process, reduce cart abandonment, and increase sales efficiency for retailers. For example, according to the European Central Bank in January 2024, the number of contactless card payments in Germany during the first half of 2023 grew by 24.3% compared to the same period in 2022, reaching 20.9 billion transactions, with the total value increasing by 25.9% to €0.5 trillion ($545.27 billion). Consequently, the rising adoption of digital payment systems is fueling growth in the online retail market.

Leading companies in the online retail market are concentrating on developing sophisticated solutions such as AI-powered personalized shopping tools to enhance product discovery and improve customer experience. These AI-driven tools analyze user behavior, preferences, and shopping patterns to deliver more relevant product recommendations, boosting customer engagement. For instance, in March 2025, Amazon.com Inc., a US-based e-commerce company, introduced Interests, an AI-powered shopping feature currently in beta. This feature improves personalization, increases the time users spend on the platform, and aims to make online shopping more intuitive and enjoyable. Interests continuously scan Amazon’s product catalog and proactively suggest items that match users’ tastes, hobbies, and shopping history, allowing customers to follow specific interests and receive tailored recommendations through a Pinterest-style visual feed.

In April 2024, Huddled Group, a UK-based e-commerce retail company, acquired Food Circle Supermarket Limited for £0.3 million ($0.35 million). This acquisition is intended to expand Huddled Group’s e-commerce presence in the health and surplus food market by utilizing operational synergies and accelerating growth. Food Circle Supermarket Limited is a UK-based online retail service provider.

Major players in the online retail market are Walmart Inc., Amazon.com Inc., Apple Inc., Costco Wholesale Corporation, JD.Com Inc., The Kroger Co., Alibaba Group Holding Ltd., Albertsons Companies Inc., Best Buy Co. Inc., Adidas AG, Coupang Inc., Rakuten Group Inc., Zalando SE, eBay Inc., PUMA SE, Shopify Inc., Flipkart Internet Private Limited, Etsy Inc., Groupon Inc., and Bata Limited.

Asia-Pacific was the largest region in the online retail market in 2024. The regions covered in online retail report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa. The countries covered in the online retail market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report’s recommendations and conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

The rapid escalation of U.S. tariffs and the resulting trade tensions in spring 2025 are significantly impacting the retail and wholesale sector, particularly in sourcing, inventory management, and pricing strategies. Higher duties on imported consumer goods including electronics, apparel, furniture, and packaged foods have raised procurement costs for retailers and wholesalers, compelling many to either increase prices for end consumers or absorb losses. Small and mid-sized businesses with limited pricing power are especially vulnerable, often facing squeezed margins and reduced competitiveness. Inventory cycles are also disrupted as firms grapple with delays and uncertainty in international supply chains. Additionally, retaliatory tariffs in foreign markets have curtailed export opportunities for U.S. brands, limiting revenue growth. In response, companies are shifting toward domestic and regional suppliers, investing in supply chain resilience, and adopting data-driven demand forecasting to navigate cost volatility and maintain customer satisfaction.

Online retail involves the purchase and sale of goods and services through internet-based platforms. It allows consumers to shop via websites or mobile applications, providing convenience, a broad range of products, and often competitive prices.

The primary product categories in online retail include groceries, apparel and accessories, personal and beauty care, footwear, and others. Groceries consist of essential daily items such as food and household supplies, which are increasingly bought online due to growing internet usage and busy lifestyles. Various models exist, such as business-to-business (B2B), business-to-consumer (B2C), and consumer-to-consumer (C2C), supported by different portals such as third-party marketplaces, direct-to-consumer (D2C) brands, or individual websites.

The online retail market research report is one of a series of new reports that provides online retail market statistics, including the online retail industry global market size, regional shares, competitors with the online retail market share, detailed online retail market segments, market trends, opportunities, and any further data you may need to thrive in the online retail industry. This online retail market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The online retail market includes revenues earned by entities through order placement and tracking, multiple payment options, home delivery, customer support, and return and refund services. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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