Verdict predicts online expenditure will increase by more than 56% to £35bn by 2014, continuing to outperform the total retail market.
However, annual growth will slow "considerably", coming in at 12% between 2009 and 2014 compared to an average of 35% per year, over the previous decade.
It said that 34- to 44-year-old online shoppers, the age group which currently spends the most online at £6.2bn, accounting for a third of online sales in 2009, are most likely to cut back spending.
According to Verdict, the number of online shoppers will rise to 32.5 million in 2014, which is an increase by four million from now. Their spend will be spread more widely across a range of websites as the number of e-retailers continues to increase.
Malcolm Pinkerton, senior retail analyst at Verdict said the number of people shopping online is becoming "highly saturated".
He said: "Retailers will have to change and evolve their online strategies. Driving loyalty and increasing spend per head across all age groups will become vital factors to ensure growth."
The 34- to 44-year-olds spend £992 per head per year, followed by 25- to 34-year-olds who spend £806. However the research showed that shoppers in the 15-24 and 55+ groups show the most growth potential.
Sarah Peters, Verdict senior retail analyst, said: "Retailers have had it relatively easy online over the past decade because of the channel's rapid growth and lack of competition, but just as in overall retail, the next five years will be much more challenging."
High street retailers and all launched online shops in the UK this month.
Meanwhile eBay is ramping up its online retail offering with the launch of two vertical hubs for and .
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