Report: Online retail sales to hit $440 billion in 2017
Online growth — and along with it, online market share — continues to accelerate.
The trajectory is so strong that sales are on pace to hit $440 billion in 2017, a leap from $395 billion expected in 2016, according to “U.S. Online Sales Forecast: Omni-Channel Retailing Challenged by Its Success,” a report from FTI Consulting.
Online retail sales growth has accelerated slightly in the past year to just over 14%. While growth will moderately slow to 11.4% next year, this volume eclipses anticipated store-based sales that will range between 2% and 3%, the report said.
As expected, online-only retailers, predominantly Amazon.com, are taking an increasing share of total online sales despite the success to date of many omnichannel retailers — those with a combination of traditional retail stores, online stores or other shopping channels, the report explained.
“For each marginal sales dollar that migrates away from stores to the online channel today, only about $0.68 stays within the traditional retail ecosystem,” said Christa Hart, senior managing director in the retail and consumer products practice within FTI Consulting’s finance and restruc-turing segment. “Online sales by omnichannel retailers are growing ro-bustly, but aren’t accelerating enough to match Amazon’s torrid sales growth. There is little reason to believe this trend will reverse, despite the efforts of traditional retailers.”
That said, FTI predicted that online retail sales will reach $562 billion by 2020, with online market share reaching 21%, excluding the low penetra-tion category of grocery. This growth trajectory will result in a near-doubling of online market share by 2026, the report said.
“Consumers’ shopping patterns have evolved, and it’s not just during ‘event days’ such as Cyber Monday. Most shoppers are completely com-fortable purchasing goods online every day from any of several personal devices,” Hart said.
Considering that 90% of shoppers made an online purchase in the past three months, according to another FTI report, “Online, Offline or Both, Shoppers Call the Shots 24/7, “We expect [consumer] migration to the online channel to continue over the next decade, particularly given the findings in our recent article on omnichannel and customer preferences,” she added.
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