Research: E-Commerce to Take Higher Slice of US Retail Market

Online retailers will need a competitive map pricing policy – a service offered by firms such as PriceManager – and other business strategies in the near future, as e-commerce sales will account for 17% of the U.S. retail market by 2022, according to a report. Forrester Research released the report that suggested online sales to be worth more than $459 billion in 2017, up 14% year over year. The figure would also represent 12.9% of the expected $3.56 trillion in total retail sales.

Online Experience

The report attributed the projected increase in online transactions to the positive customer experience. More shoppers find it convenient to use e-commerce, which reflects the results of the Forrester 2016 Customer Experience Index. It showed that online shopping provided 17 good experiences for each bad one. On the other hand, traditional brick-and-mortar stores were only able to tally 13 positive experiences for shoppers. Aside from the growing popularity of online shopping, more Americans have had positive sentiments about economic growth prospects. As of June, as much as 54% of consumers believe that the U.S. economy will grow in the future, as opposed to only 46.3% of shoppers in the same month last year.

Purchasing Power

By 2022, shoppers would buy apparel, consumer electronics, and household products more than any other online product category. An expected increase in house-ware purchases would outrank computers, which is currently the third most preferred product among Americans. The report also noted that Amazon would continue to dominate the market, as there were 83% of adults that used it in 2016, while 55% relied on it as a reference guide before deciding on a purchase.

Conclusion

Industry competition would become tighter than e-commerce sales are set for stable growth in the next five years. For this reason, online retailers should prepare to make sure that their business benefits from the expected increase.