Topic of the week – eCommerce growth in the US (What is the driving force?)
The US ecommerce market has continued to grow over the past years making up 24.5% of worldwide eCommerce revenue in 2022, predicted to generate $1,010.88 billion USD by the end of 2023. Between 2021-2022 the US eCommerce market saw a 8% increase in revenue. The question must be asked, what is driving this eCommerce powerhouse? Why are more and more people buying online? And what are people buying?
Purchasing groceries online has started to become the norm, be it through Deliveroo or Amazon Fresh, more and more people do their weekly shop online. In the US the food and beverage sector ranked 5th in the most common online purchase categories in 2022 at 26%. The sector has also recorded a 20.7% year-on-year sales growth in 2022, with the food industry alone having the highest predicted compound annual growth rate from 2017-2027 at 24%, dominating the Fashion sector by over 10%.
Major eCommerce retailers and marketplaces such as Amazon and Walmart have led the pack for years and still remain at the top of the eCommerce industry. Amazon was at the top of the most popular online shops in 2022 at 76% with Walmart following at 49%. Despite this, signs are starting to show that more category driven brands, for example in the US Chewy, are closing the gap between these industry giants. Chewy, a pet food and supplies e-tailer, equated to 15% amongst respondents, as one of the most popular online shops in the US in 2022, generating $8,891 million USD eCommerce revenue as one of the top 10 stores. Another example of category driven brands moving up the ranks would be Carvana which sat above Costco in the top 10 stores generating $9,851 million USD in eCommerce revenue. It is becoming apparent that as more and more brands emerge, eCommerce users are wanting to buy directly from their online stores as opposed to massive eCommerce marketplaces like Amazon.
Younger demographics are more focused on online fashion with a boom in online secondhand fashion stores. The apparel and footwear sector generated $183.6 million USD in 2022. It also experienced year-on-year sales growth of 15.4% from 2021-2022. With sustainability becoming increasingly more important, younger audiences are now opting to purchase secondhand and recycled clothing items, meaning that there are more online stores to fill consumer needs. The highest share of consumers that either have bought from secondhand e-tailers and plan to in the future, or have not bought from them but plan to were aged between 18-24 years old.
It is also interesting to see that the majority of secondhand e-tailer shoppers were frequent TikTok users at 46%. It is no secret that the use of social media is a big factor when marketing products and appealing to younger audiences. Social media organisations such as Instagram and TikTok are now producing their own marketplaces, where users can shop through their favourite app without having to search the product online. This has lead to a new wave of product discovery, as users can now see a product advertised on a social media post, by a company of influencer that they follow, and purchase said product within minutes, all through one app, and then go back to scrolling. The shopping experience no longer starts solely from a company’s website.
In other news
Danish company, SwipBox, is bringing its parcel locker service to the US, with over 30,000 lockers already installed in the EU. Their lockers are battery-powered, meaning they can be placed anywhere without the need for an external power source or internet connection. This means that coverage can be increased to more hard to reach areas where other lockers may not be able to be housed. The main goal of SwipBox is to create the most streamlined and user-friendly parcel delivery and collection service in the US, partnering with DHL express, one of the serious postal players in the US, and providing consumers with an app from which they can handle all of their orders.
eCommerce Market Stats
See some statistics relating to this week’s topics in the US eCommerce market below.
eCommerce in the USA
Age demographics
- 15.8% of mobile eCommerce shoppers are aged 18-24
- 24.6% of mobile eCommerce shoppers are aged 25-34
- 59.6% of mobile eCommerce shoppers are aged 35-55+
Device usage split
- Mobile – 46.8%
- Desktop – 53.2%
Most Common Purchase Categories by revenue (billion USD)
- Toys, Hobby & DIY – 216.3
- Fashion – 183.6
- Electronics – 130.6
Groceries Sector Stats
Intended online groceries spending share among US consumers was 20% in 2022.
Top online groceries stores 2022 by revenue (million USD)
- Kroger.com – 4571
- Walmart.com – 3716
- Hellofresh.com – 3108
Device usage split
- Mobile – 50.6%
- Desktop – 49.4%
Intended e-commerce spend share in 2022 by category
- Electronics – 40%
- Clothing & Footwear – 37%
- Groceries – 20%
Fashion Industry Stats
Top online fashion stores in the U.S by revenue (in million USD)
- Shein.com – 5790
- Macys.com – 5563
- Amazon.com – 5034
Most frequently used online channels for fashion purchases
- Retailer’s website – 35%
- Brand’s website – 33%
- Amazon – 27%
- Social Media – 3%
- Other – 2%
Device usage split
- Mobile – 58.9%
- Desktop – 41.1%
*All statistics sourced from Statista - eCommerce in the United States dossier - Fashion eCommerce in the United States dossier
That’s all for this week…
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