6 Online Retail Trends
The following six trends were discussed by Scott Silverman, executive director of Shop.org, during the closing keynote session of the Retail Marketing Virtual Conference & Expo, which took place on June 24 and is on demand until Sept. 28.
1. Online retail growth in the context of overall retail and Amazon.com. Online sales today far outperform retail stores, and they continue to be a bright spot in the industry and a growth driver in retail overall. But retailers should also think about the web's impact on offline sales. "Looking at the impact the web has on offline sales makes you think about things differently, and makes you think about the fact that online sales are just the tip of the iceberg," Silverman said.
Another way of looking at online sales is in the context of Amazon.com. In the first quarter of 2010, Amazon.com's sales were up 39 percent vs. overall U.S. online sales, which were up 10 percent over the first quarter, Silverman said. "There's no question that Amazon.com is grabbing market share, and grabbing it from quite a few retailers," he said. "So, every retailer must think about what their competitive strategies are in relationship to Amazon."
2. Latest sales data. Silverman presented data from Shop.org's latest first quarter flash survey of 75 retailers. The results included the following:
- average web retailer sales growth for the first quarter of 2010 vs. the first quarter of 2009 was 12.3 percent;
- more than half of the retailers surveyed reported year-over-year (YOY) sales increases of 10 percent and higher;
- only one-fifth of retailers reported YOY sales increases of 10 percent or less; and
- the majority of large and midsize retailers surveyed experienced sales increases, and almost two-thirds of small retailers ($10 million and under) also experienced sales growth.
3. Cross-channel retail. Cross-channel retail strategies remain in the early stages, Silverman said. "The problem we're having as an industry is that if you're a multichannel retailer with retail stores, you're thinking about the ROI and profitability of your online sales, so every dollar you spend you want to plow that back into online sales," he said.