Even as most brick-and-mortar channels improved this past holiday, eCommerce took even bigger steps toward capturing holiday shoppers’ dollars.
The government’s recently released quarterly sales measure indicates eCommerce sales in the holiday fourth quarter grew at their strongest pace in six years. The 16.8% growth in the channel compares to 5.2% for total retail less auto, fuel, food services, and 3.6% for brick-and-mortar in the fourth quarter. Growth at the topline and brick-and-mortar was the strongest since 2014, pointing to shoppers’ stronger spending sentiment this past holiday which lifted both online and in-store growth.
Online’ s holiday performance was impressive in terms of scale—not just growth—in the fourth quarter. eCommerce posted sales of $143 billion dollars, accounting for 15% of all sales. The record share of sales jumped 1.5 percentage points from the previous holiday. The channel accounted for 43% of added sales relative to a year ago—a measure which puts into perspective both the scale and growth of online.
Amazon was a large contributor to the record holiday, but online played a prominent role in driving topline growth at several predominantly brick-and-mortar retailers. Target, Costco, and a handful of department stores already reported strong online growth. Other retailers will report their fourth quarter results in the coming weeks. (Most the online sales at these retailers are captured in the government’s eCommerce measure in addition to online specialists.)
Kantar Consulting expects online growth to keep up its strong pace of growth in the New Year. It’s forecast which was published prior to the release of the fourth quarter data is for online growth of 15.3% in 2018. In addition to the strong momentum online already has coming out of the holiday, the strategic shift among retailers to close or dramatically slow the opening of brick-and-mortar stores in 2018 to free up resources for online investment supports the outlook for another year of strong online growth.
KRiQ clients can find more on the 2017 holiday in these publications:
Holiday 2017 Shopper Review (ShopperScape® subscribers)
Kantar Retail’s Seasonal Pulse: Holiday 2017
A cheerier holiday for U.S. retailers
December retail sales: Holiday shoppers rebound from last year
Doug Hermanson, Principal Economist