McKinsey estimates that ten years’ worth of e-commerce adoption has taken place within the compressed period of just three months. This has been true the world over, and this has been true in the U.S. as well.
In this article, we’ll take a look at some of the e-commerce opportunities that have either emerged or burgeoned in the U.S. in 2022. From this, retailers should be able to glean opportunities that exist right now or lay ahead that they can capitalize on to create an even more competitive business.
Overview of e-commerce in the U.S.
When it comes to market volume, Statista reports that revenue from retail e-commerce in the U.S. was estimated to have reached US$ 768 billion in 2021. The forecast from The Statista Digital Market Outlook projects that the revenue is set to grow during the 2017–2025 forecast period to potentially exceed US$ 1.3 trillion by 2025.
These figures are staggering and show the potential that is lying within e-commerce at large. But it’s not enough to understand e-commerce revenue trends if they are not seen as a share of total retail sales that are taking place.
Statista reports that e-commerce actually accounted for 10.7% of total retail sales in the U.S. This share grew during distancing measures, with figures showing that the share of U.S. online sales in total retail sales reached 15.7% in 2020, which was an all-time high.
When looking at performance by product category, reports show that the compound annual growth rate (CAGR) that has been recorded for e-commerce categories is an average of 13.5% for the 2017–2025 forecast period.
Over the 2020–2021 period, the apparel and accessories category was the one with the highest year-on-year growth, with retail e-commerce sales increasing by nearly 19% from the previous year. The food and beverages segment recorded the second-fastest growth at around 18% from the previous year.
E-commerce opportunities in the U.S.
Now that we have a grasp of the U.S. e-commerce market at large, let’s take a look at the various opportunities that stand out for 2022 and beyond.
Growing demand for online retailers and marketplaces
Year-on-year growth figures from Statista on retail-oriented online debit and credit-card spending looked at as a proportion of total shares in the U.S show a peak from 19% in January 2020 to 26% in January 2021. This shows that more and more B2C as well as B2B buyers are transacting online.
All these buyers, existing and new, are going to be looking for online retailers and marketplaces that suit their buying preferences. This has been reflected in figures that show that up to 48% of online shoppers go directly to e-commerce marketplaces when making online purchases. That’s nearly half of all online shoppers!
This means that if you are a retailer looking to sell your products, it’s imperative that your brand has a presence on key marketplaces that are able to give you the visibility and reach that your brand needs.
When looking at the volume of online shoppers in the U.S., Statista reports that the number of digital buyers grew significantly, and is expected to continue growing within the 2017–2025 forecast period. The U.S. had an estimated 230.6 million digital buyers in 2017, 256 million in 2021, and is expected to record up to 291.2 million online shoppers by 2025.
These figures are staggering and show that retailers and service providers are going to need to meet consumers where there are — online. To ensure that they are able to capitalize on this great exodus to online commerce, businesses should work on the following:
- Strengthen visual strategy: Create and publish high quality photo and video content or rich media that stands out and draws consumer attention while being relevant and informative.
- Trade on a marketplace: For brands to be seen by consumers, they need to meet them where they are preferring to shop online. Marketplaces also open brands up to wider, more global audiences.
- Offer flexible fulfillment methods: The online shopping experience doesn’t just end with transacting online, consumers are looking for faster, more efficient, and more convenient order fulfillment. Offer varied fulfillment solutions such as same-day delivery, next-day delivery, click and collect pickup, and curbside delivery, depending on the product offering.
Changing shopping behavior
Before going into some of the specific changes, it’s worth looking at the key drivers that spurred online purchases in the U.S. in 2021. A Statista survey showed that some of the top ones (in order of share of respondents) include:
- Direct delivery to the customer’s home (60%)
- Online being a more convenient way of shopping (51%)
- Cheaper prices (50%)
- Available round the clock (46%)
- Greater product range (44%)
- More possibilities to compare (41%)
With changes in where consumers shop come changes in how consumers shop. This has been true over the past few years as consumer perception of online shopping has been steadily shifting in the U.S.
What has become clear is that most online shoppers rely on the internet significantly as a means of product research before they make their purchases. For instance, in a survey on attitudes toward online shopping in the U.S. in 2021, 55% of the surveyed respondents reported that “When [they] plan a major purchase, [they] always do some research on the internet first” while 52% of the respondent reported that “Customer reviews found on the internet were very helpful.”
This points to the importance of online visibility for brands and products, but not just any kind of visibility, it needs to be strategic and optimized so as to actually reach the right consumers. This is where content optimization comes in. In order to increase brand and product awareness and rank highly in consumer search results, companies need to invest in having a strategy for Search Engine Optimization (SEO).
Businesses can conduct keyword research using the wide range of SEO tools available such as SEMrush, Ahrefs, and Moz, which help with checking the search volume of different keywords as well as the top keywords associated with competitors.
They can also create SEO-based title tags and meta descriptions on their storefronts or product detail pages to increase their chances of being seen when prospective customers search for the kind of products the business offers.
The social network shopping channel has seen increased adoption over the past few years. In 2020, it was reported that more than 79 million people had made purchases through social networks. This figure is set to increase as Statista projects growth by nearly 37% to 108 million social buyers by 2025.
When it comes to buyer distribution by platform, more than 22% of online users in the U.S. who had made purchases on social media platforms used Facebook, while almost 13% used Instagram. As social channels have become the new shopping hubs, there is an opportunity to ensure that your business stands out from competitors by strengthening your social media strategy.
As shoppers continue to seek out more convenience in their shopping experiences, more and more consumers are adopting the omnichannel shopping approach that sees them utilizing brands’ online and offline touch points. This goes from in-store point-of-sale systems to shoppable Instagram posts and various delivery solutions.
By integrating various online and offline channels, businesses are better able to offer customers seamless shopping experiences and the convenience that has been reported as being one of their key drivers for shopping online.
Strengthen your business’s e-commerce strategy
With the accelerated adoption of e-commerce in the U.S., it’s clear that for businesses to thrive, they are going to need to adopt effective e-commerce strategies as a way to capitalize on the various opportunities that have arisen within the U.S. e-commerce market at large.
It’s important for businesses to re-look at their sales, marketing, and customer acquisition strategies to ensure that they are actually offering consumers what they want and how they want it.
In summary, the major e-commerce opportunities in the U.S. are related to:
- Growing demand for online retailers and marketplaces as a result of increased online shoppers
- Changing shopping behavior
From these areas of opportunity, the key take-aways are:
- Sell your products on an online marketplace to reach more consumers.
- Strengthen your visual marketing strategy to gain consumer attention.
- Offer flexible order fulfillment options for greater convenience.
- Make your storefront and product pages SEO-based for greater visibility.
- Strengthen your social media strategy to push social commerce.
- Adopt an omnichannel strategy for seamless shopping experiences.