US E-Commerce Sales to Jump 18% in 2020, but Not Enough to Offset Retail’S Decline | Techcrunch

9/22/2020 US e-commerce sales to jump 18% in 2020, but not enough to offset retail’s decline | TechCrunch

US e-commerce sales to jumJopin E1xt8ra% in Login 2020, but not enough to offsCerutnc rhetail’s decline

Sarah Perez Search @sarahintampa / 10:42 am EDT • June 8, 2020 Disrupt 2020 Startups Videos Disrupt Videos Audio Newsletters Extra Crunch The TC List Advertise Events — More

Image Credits: Sari Montag / Flickr under a CC BY-SA 2.0 license.

U.S. e-commerce sales will jump 18% this year due to the impact of the coronavirus pandemic that forced more shoppers online, according to a new forecast released today by eMarketer i . However, the surge in new online orders won’t make up for the overall hit that the U.S. retail sector will take this year, the firm noted. The analysts estimate that total U.S. retail sales, which also includes auto and fuel, will drop by 10.5% in 2020 to $4.894 trillion — a level not seen since 2016.

This is also steeper than the 8.2% drop last seen in 2009, amid the recession.

“This is the sharpest consumer spending freeze in decades in the U.S.,” said eMarketer senior forecasting analyst Cindy Liu, in a report. ‘In just a couple weeks, as Americans sheltered in place, retail sales fell dramatically in March. With sales hitting their lowest point

https://techcrunch.com/2020/06/08/u-s-e-commerce-sales-to-jump-18-in-2020-but-not-enough-to-offset-retails-decline/ 1/10 9/22/2020 US e-commerce sales to jump 18% in 2020, but not enough to offset retail’s decline | TechCrunch of the year in Q2, it will take years before consumer activity returns to normal levels,” she predicted. Join Extra Login Crunch The Daily Crunch Sign up Tech's biggest headlines Search

Disrupt 2020 In fact, the forecast estimates total retail sales won’t rebound to prepandemic levels (i.e., Startups 2019 levels) until 2022. Videos Disrupt Videos Audio Newsletters Extra Crunch The TC List Advertise Events — More

Physical retail is weighing down overall retail in the long term. This year, brick-and-mortar retail sales will fall by 14% to $4.184 trillion. And it may take up to five years for offline sales to return to prepandemic levels.

E-commerce hasn’t been strong enough to offset those losses — it’s only mitigating the severity of retail’s decline, the report said. In 2020, e-commerce sales will climb by 18% to

https://techcrunch.com/2020/06/08/u-s-e-commerce-sales-to-jump-18-in-2020-but-not-enough-to-offset-retails-decline/ 2/10 9/22/2020 US e-commerce sales to jump 18% in 2020, but not enough to offset retail’s decline | TechCrunch reach $709.78 billion, representing 14.5% of total U.S. retail sales.

The report didn’t delve deeply into the contributing factors as to why overall retail sales will Join Extra remain down despite stores reopening, but these would include the obvious impacLtso greinlated Crunch to a coronavirus-triggered recession — like job losses and job insecurity, both of which prompt consumers to quell their spending. In addition, many consumers still continue to avoid brick-and-mortar retail entirely, instead only ordering their Sesesaerncthials online. Plus, with many consumers now working from home, apparel and accessories sales have taken a

heavy hit. Disrupt 2020 Startups The apparel and accessories category is typically the second-largest in e-commerce, for Videos example, but will only grow 8.6% as consumers shift spending away from discretionary, Disrupt Videos non-essential purchases. Audio Meanwhile, other e-commerce categories including food and beNveerwagsele atntedrs health/beauty/personal care are up by much more — the former Ebxyt r5a8 .C5r%un acnhd the latter by 32.4%. The TC List Advertise Events — More

https://techcrunch.com/2020/06/08/u-s-e-commerce-sales-to-jump-18-in-2020-but-not-enough-to-offset-retails-decline/ 3/10 9/22/2020 US e-commerce sales to jump 18% in 2020, but not enough to offset retail’s decline | TechCrunch “Everything we’re seeing with e-commerce is unprecedented, with growth rates expected to surpass anything we’ve seen since the Great Recession,” said Andrew Lipsman, eMarketer principal analyst. “Certain e-commerce behaviors like online grocJeoryin s Ehoxptrpaing and click- Login and-collect have permanently catapulted three or four years into Cthreu nfucthure in just three or four months,” he added.

The shift to online grocery has been particularly beneficial to WalSmeaarrtc, whhich typically cites online grocery as a contributing factor to its overall e-commerce sales growth. Emarketer’s

new report also noted that Walmart will, for the first time, surpasDs iesBruayp ta s2 0th2e0 No. 2 e- commerce retailer in the U.S, behind Amazon i . It expects WalmStaartr twuiplls see its e-commerce sales jump by more than 35% in 2020, growing to claim a 5.8% Vshidaereo osf the U.S. e- commerce market. Disrupt Videos Audio Target, Best Buy, The Home Depot and Costco will grow as well. Newsletters Extra Crunch But Amazon, as expected, will outpace the lot. The TC List Advertise “Amazon will increase its e-commerce market share to 38% and extend its reign of Events dominance,” Lipsman said. — More

TC Sessions: Mobility 2020 Mobility expo tickets now available

Virtual Event Oct 6 - 7 https://techcrunch.com/2020/06/08/u-s-e-commerce-sales-to-jump-18-in-2020-but-not-enough-to-offset-retails-decline/ 4/10 9/22/2020 US e-commerce sales to jump 18% in 2020, but not enough to offset retail’s decline | TechCrunch

Just $25

Join Extra Login Crunch Sign up for Newsletters

See all newsletters Search

The Daily Crunch Disrupt 2020 Week in Review Startups

Startups Weekly Videos

Event Updates Disrupt Videos Audio Human Capital Newsletters Sponsorship Insider Extra Crunch Extra Crunch Announcements The TC List Extra Crunch Events Advertise

Extra Crunch Roundup Events — More Email * Subscribe