US ecommerce sales will rise 24% to $65 billion this year and growth will be maintained through to 2008 when online will account for 5% of all retail sales, according to a new study by Jupiter Research.
The report,
Market Forecast: US Retail 2004-2008, claims that online retail growth is being driven by an influx of new internet shoppers and an increase in average spending per buyer. comScore estimates that a record $17.21 billion was spent on American retail sites in the three months to the end of December (see
Internet Retail Boom Persists In Q4).
As web usage matures and the internet population reaches saturation, Jupiter predicts the growth in new consumers choosing to buy online will slow and reach a penetration of 67% of all online users by 2008. However, by then average spending per user will have soared to $780.
Not all retail categories will grow at the same rate. Retailers of early success areas such as PCs, books and software will experience compound annual growth rates of less than 10%. Areas of steep growth (30%+ CAGR) are the home and personal care categories like home improvement, grocery and over the counter drugs. Steady online sellers will include heavy volume players such as apparel and consumer electronics.
Jupiter forecasts that total online retail sales will hit $65 billion this year and grow at a compound annual growth rate of 17% to reach $117 billion in 2008. While the online sector will account for only a small proportion of retail sales, it should be acknowledged that an increasing number of high-street purchases are internet influenced (see Internet-Influenced Offline Spending 50% Higher Than Online Spending). It is predicted that in four years time, almost 30% of offline retail purchases will be prompted by research carried out online.
