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Web sales growth holds in double digits and online holiday forecasts are jolly.
E-retail's growth rate slowed slightly in the third quarter, but analysts predict it will pick up during the crucial fourth quarter and that holiday season growth will be in line with last year's 16.3% year-over-year increase.
U.S. e-commerce sales reached $48.24 billion in the third quarter, up 13.7% from $42.42 billion a year ago, according to the U.S. Department of Commerce. That growth fell short of the more than 17% increases for the first two quarters of the year, but Q3 2011 e-commerce sales in dollars still grew 1.9% from $47.35 billion in Q2, according to seasonally adjusted estimates from the Commerce Department.
E-commerce accounted for approximately 4.6% of total retail sales excluding foodservice—essentially restaurant sales—during the three months ended Sept. 30, up slightly from 4.5% in the second quarter, the Commerce Department says. Total retail sales excluding foodservice during Q3 totaled $1.05 trillion.
Moving into the fourth quarter—the make-or-break period for many retailers—a preliminary estimate issued by the Commerce Department in mid-November pegged total retail sales excluding foodservice in October at $355.84 billion, up 7.3% from $331.59 billion in October 2010, and up 0.5% from September 2011 sales of $353.86 billion, a sign consumers are opening their wallets a little wider—and a little sooner—going into the holiday shopping season than last year.
Consumers responded as many retailers pushed their holiday marketing schedules up to start well ahead of Thanksgiving this year. A survey fielded by comScore Inc. in October found that 41% of consumers had already started their holiday shopping, and IBM Coremetrics estimates online sales in November will be up 12-15% from the same month a year ago. Experian Hitwise, a firm that tracks web traffic, reported that traffic to top e-retail sites was up 10% year over year for the week ended Oct. 23.
Forecasts for holiday sales put e-retail sales growth comfortably in the double digits for the second year in a row. Forrester Research Inc. estimates total sales in November and December will increase 15% year over year to $59.5 billion, with that growth largely stemming from more consumers shifting a bigger share of their gift-buying budgets from stores to the web to stretch their dollars.
ComScore projects e-retail sales will grow in the range of 15-17% during the same period. EMarketer projects online sales will increase 16.8% this holiday season while total retail sales rise only 3%.
Third quarter data bolstered those projections. ComScore says 182 million U.S. consumers, or 74% of online adults, bought something on the web during the third quarter, up from 149 million and 62% of online adults a year ago.
Meanwhile, the largest U.S. e-retailer by sales, Amazon.com Inc., grew its North American sales 43.9% during the quarter to reach $5.93 billion, and, for the first time, the number of average monthly unique visitors to Amazon.com topped 100 million, comScore says.
Scot Wingo, CEO of ChannelAdvisor Corp., a company that helps facilitate sales through online marketplaces, says the company's merchant clients saw their Amazon.com same-store sales surge 80% year over year during the quarter, making it the best-performing sales channel for its clients during Q3. Wingo says he expects e-retail sales across all channels for his clients to grow about 15% during the fourth quarter. Online retail sales grew 16.3% during Q4 2010 over the previous year, according to the Commerce Department.
"We think holiday sales growth will be pretty comparable to last year, and last year was pretty good," Wingo says. "It makes it a tough comparable because it is hard to grow as much on top of such a good year, but we are pretty optimistic."
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