ECommerce Explodes: 45% Growth In Q2
Source: US Census Bureau
While many retailers flounder, some omnichannel merchants are killing it online.
Years of economic growth have been wiped out by COVID-19. However, the story for e-commerce has been the opposite: an acceleration of growth that otherwise might have taken years.
Approaching 20% of retail. The U.S. Commerce Department reported new retail sales data (.pdf) earlier this week. It shows a huge spike in second-quarter e-commerce spending as a percentage of total retail, growing from 11.8% in Q1 to 16.1% in Q2.
Some analysts and outlets exclude categories such as restaurants, bars, automobile dealers and gas stations to tell a stronger growth story. Using that formula, which is a bit of a cheat, e-commerce is now closer to 21%.
To put all that into larger context, July retail sales data showed growth of 1.2%. That followed a 7.5% increase in June on the heels of an 18.2% jump in May. So, as retail sales have slowed, e-commerce has gained momentum.
Years of growth in a quarter. For years e-commerce hovered just under 10% of total U.S. retail sales — leading to the familiar conference refrain: “90% of retail sales still happen in stores.” While it remains to be seen what happens when the pandemic fully subsides (whenever that may be), there’s no question that e-commerce is exploding and higher levels of online spending are here to stay.
Year over year (YoY) online shopping growth in Q1 was 14.8% and 2.4% sequentially. But in Q2 (April–June), when most state lockdowns were fully in place, e-commerce surged 44.5%, while quarterly growth was 31.8%. These are huge numbers, fueled in large part by consumer necessity.
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