There are lots of reasons to look back at 2009 from an economic point of view and cringe. Unemployment was up, consumer confidence was down and many Americans found themselves devising new ways simply to get by. Despite all of that though, e-commerce overcame a recession that dragged down the rest of the retail industry to post an 11 percent rate of growth last year and a leading research firm expects 2010 to be a repeat performance.
Released today, Forrester Research’s new report, “U.S. Online Retail Forecast 2009 to 2014”, takes a look at the year that was in 2009 for online shopping and also presents some promising predictions for the e-commerce industry over the next four to five years.
Forrester reports that 2009 saw 154 million people buying items on the web, representing 67 percent of the total number of online users. The result: $155.2 billion in sales and an 11 percent increase in overall online spending from 2008. Now sure, 11 percent doesn’t hold a candle to previous years when online spending was growing 20 percent or so each year. But like anything else, as more and more shoppers have flocked to the internet, growth can’t help but level off. Throw in the fact that every economic factor and indicator was pointing downward in 2009 and 11 percent increases start to sound really good!
And according to Forrester, it’s only the start. Their report sees online retail growing at a rate of 10 percent annually over the next 4 years and predicts total online spending somewhere in the neighborhood of $249 billion by 2014.
Forrester projects that online shopping will grow by another 11 percent here in 2010 and that e-commerce could account for as much as 7 percent of ALL U.S. shopping this year. (By comparison, the National Retail Federation optimistically predicts only a 2.5 percent increase in overall U.S. retail for the current year.)
The best-selling U.S. online retail categories have consistently been clothing (apparel, footwear, and accessories), consumer electronics, and computers (hardware, software, and the like). Those three categories already account for about 40 percent of all online retail sales across the country and will likely continue to do so, according to the report. Both the clothing and electronics registered 17 percent increases in sales in 2009.
So what do we take away from these positive projections?
For one, it’s clear that the clothing and electronics sectors will continue to lead the way for online shopping; the former due to the fact that it attracts younger, more tech-savvy shoppers and the latter because of how easy it is to research models and compare tech items by using the web.
The report also indicates that in addition to the usual benefits of convenience and selection, e-commerce enjoys such strong growth and potential because retailers are offering innovative online shopping experiences and incorporating social networking tools as well.
Finally, Forrester states that 42 percent of all 2009 retail purchases, worth about $917 billion, were influenced by the web in some way. Forrester argues that in the future, the line between online and offline commerce will only get more blurry and that retailers who find ways to use e-commerce to influence in-store purchases will see the best results. With m-commerce growing as well, this means retailers everywhere will be looking to expand intelligently to ensure that they’re getting a slice of what promises to be a teeming pie of potential revenue and customers.
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