Search Engines Drive £31.4 Billion in Retail Spend

New Report Highlights Retailers’ Opportunity to Leverage AI and Close a £6.7 Billion Revenue Gap. 

LONDON, 05.02.25 – Search engines remain the most influential driver of retail discovery, driving £31.4 billion in annual UK retail spend (non-food)—more than any other digital or physical channel. However, a new report from Retail Economics and Upp.ai reveals a significant perception gap within the industry. Many retailers underestimate search’s continued influence amid the growing dominance of social commerce and marketplaces, risking £6.7 billion in untapped revenue at a time when consumer attention is increasingly fragmented.

The report, From Search to Sale: How AI Drives Consumer Discovery and Retail Spend, explores why search engines remain vital in today’s fragmented attention economy and highlights how artificial intelligence (AI) is transforming their role, enabling retailers to better engage consumers, optimise ad spend, and drive growth.

The Resilience of Search in a Fragmented Landscape
In today’s retail landscape, where consumer attention is increasingly fragmented, search engines remain a dominant force:
Discovery Leader: Search engines drive £31.4 billion in retail spend annually, surpassing online marketplaces (£30.9 billion) and retailer websites (£27.6 billion). They are the most effective channel for product discovery, influencing 24% of digital retail spend and outperforming other digital and physical touchpoints.

Simplifying Complexity: In an increasingly fragmented retail ecosystem, search engines act as gateways, guiding consumers through a sea of options to make informed decisions. On average, consumers consult three sources during their research, with 72% of consumers citing search engines as their first port of call when conducting in-depth research on new products or services.

Trusted by Consumers: Search engines rank as the most trusted channel for discovery. With a net 65% of consumers expressing trust in search engines, they surpass even retailers’ own websites as reliable sources for pre-purchase decisions.

Discussing the findings, Steve Warrington, SVP of Client and Industry Engagement at Upp.ai, commented:

“This research highlights that while consumer attention is fragmented across channels, search remains the most powerful driver of high-intent discovery, influencing £31.4 billion in retail spend annually. AI now represents the next stage in the development of search marketing. It operates within ad platforms managing campaigns, refining targeting and optimisation and dynamically responding to consumer intent in real-time. This level of automation and adaptability simply wasn’t available before.

By harnessing AI-driven search strategies with adaptive AI, retailers can ensure they are not just capturing demand but actively shaping it to align with their business objectives, therefore driving both immediate revenue impact and long-term customer value.”

Retailers Face a £6.7 Billion Perception Gap
While consumers heavily rely on search engines, the report reveals that retailers often undervalue their role. Retailers rank search engines fourth behind websites, marketplaces and social media, despite driving more spend and being the most trusted channel.

Search has the biggest influence on retail’s biggest spenders
Search engines are particularly influential among high-spending demographics, notably consumers aged 45–54. Often referred to as ‘digital adopters,’ this group is at the peak of its spending power, with an average annual spend of £6,500 on non-food retail—the highest of any age cohort. Search engines influence a minimum of 16% of their purchases (not including the Research Online Purchase Offline factor), highlighting their pivotal role in this demographic's shopping journey.

Despite their significant spending power, these middle-aged shoppers are often overlooked in retailers’ search strategies or digital investments, which tend to focus on younger, digitally native audiences. Yet with higher disposable incomes and more complex purchasing needs, they rely heavily on search engines for research and validation. This makes search an indispensable channel for engaging and converting high-value customers.

AI’s Role in Shaping the Future of Search
The report highlights the transformative role of AI in enhancing search’s precision and relevance. By integrating AI, retailers can:

• Tailor Results to Individual Needs: AI delivers personalised search results based on preferences, past behaviours, and values, boosting relevance and engagement.
• Predict Consumer Intent: AI anticipates what consumers need next, providing proactive suggestions at critical moments in the journey.
• Refine Campaigns Dynamically: Combining real-time consumer insights with product data, AI allows for smarter ad spend and better alignment with shopper intent.
  
  

Richard Lim, CEO at Retail Economics, added:

“In today’s increasingly complex and fragmented digital landscape, search remains the foundation of how consumers navigate the path to purchase. While new digital channels continue to emerge, search remains a trusted and intent-driven gateway that connects consumers with the products and brands that meet their needs. 

The rise of Adaptive AI represents a transformative shift, enabling search to evolve beyond passive discovery into a more intuitive, personalised, and predictive experience. For retailers, this marks a critical opportunity to rethink how they engage customers, ensuring they remain visible, relevant, and competitive in an increasingly dynamic marketplace.”

The full report is available to download here: https://insights.upp.ai/from-search-to-sale-report  



About Upp.ai
Upp.ai is a London-based technology company that has developed a next-gen AI (Artificial Intelligence) and ML (Machine Learning) platform for large retailers that automates online product advertising, providing visibility, control and analytics around multi-channel campaign deployment. 

The platform empowers digital marketing professionals with a scientific, data-driven approach to paid media activation, enhancing the effectiveness and efficiency of advertising. This results in optimised ad spend, improved product discovery and increased sales. 

The Upp.ai platform went live for customers in 2022 and now works with major brands such as Charles Tyrwhitt, B&Q and Roman Originals.

For more information on Upp.ai visit: www.upp.ai 

About Retail Economics
Retail Economics is an independent economics research consultancy focused on the consumer and retail industry. We analyse the complex retail economic landscape and draw out actionable insight for our clients. Leveraging our own proprietary retail data and applying rigorous economic analysis, we transform information into points of action. 

Our service provides unbiased research and analysis on the key economic and social drivers behind the retail sector, helping to inform critical business decisions, giving you a competitive edge through deeper insights. 

For more information on Retail Economics visit: www.retaileconomics.co.uk