Though overall retail sales growth is expected to slow this holiday season, ecommerce purchases are forecast to soar by 30% or more. Retail giants and logistics firms alike have been bulking up their infrastructure in preparation for a tsunami of online sales that is likely to surpass available transportation capacity. This will likely create delays and rising costs for package carriers in the short-term, but 2021 is expected to herald greater pricing power and profitability throughout the industry.
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eCommerce Boom Echoes Through the Holiday Season
Though some are expecting a softer holiday sales season than in previous years, mostly due to COVID-induced financial constraints on many consumers, a monumental shift in ecommerce demand is assured.
Though eMarketer expects in-store holiday sales to decline by 4.7%, US consumers will spend $190.47 billion this year on holiday ecommerce purchases, up 35.8% and representing an incremental $50 billion in sales versus 2019. Cyber Monday, the online version of Black Friday, may see blowout growth of 38.3% to a record $12.89 billion.
In fact, the ecommerce growth is so robust that online gains may entirely cancel out brick and mortar losses. Because of ecommerce, total holiday season sales are expected to eke out growth of 0.9%. That would put the total spend at $1.013 trillion.
Similarly, in their 13th annual holiday ecommerce prediction, NetElixir forecasts aggregate ecommerce sales to experience a 30% annual increase in November – December 2020, with total online sales in that period likely to exceed 20% of total retail sales in the US.
Adobe Analytics, which measures sales at 80 of the top 100 U.S. online retailers, is in line with the latter two predictions, forecasting a total of $189 billion in online holiday sales, a 33% increase compared to last year and the equivalent of two years-worth of holiday e-commerce sales growth shoved into one season.
As we head into that critical holiday season, there has already been a significant amount of underlying ecommerce strength through October.
New data from ACI Worldwide, showed a 23% increase in global eCommerce transactions in October 2020 compared to October 2019. This increase was driven by the retail, gaming, DIY and digital sectors as consumers prepare for further lockdowns.
If the Chinese market is any kind of leading indicator for ecommerce adoption and sales in the US, those optimistic expectations could certainly be met or even exceeded. Beginning on November 11, Alibaba’s Global Shopping Festival – a 2 week-long version of the usual Singles Day event – brought in RMB498.2 billion ($74.1 billion) in gross merchandise volume over the 11-day effort, a 26% increase from 2019, according to a press release emailed to Retail Dive. Interestingly, The US was the top-selling country by gross merchandise volume. The online sales event drew about 800 million consumers.
In addition, ACI’s data, based on hundreds of millions of eCommerce transactions from global merchants, showed a projected…