E-commerce Sales Performance Analysis Differs

Published on May 24, 2010 | Comments: 0
US Census Bureau and comScore drew different conclusions on the performance of U.S. retail e-commerce sales in Q1 2010.

Census Bureau Says Q1 E-commerce Sales Total $38.7B

Adjusted U.S. retail e-commerce sales totaled $38.7 billion in Q1 2010, a 1.5% increase from $38.1 billion in Q4 2009, according to estimates from the U.S. Census Bureau.

Adjustments Make Big Difference

There was a substantial difference between estimates adjusted for seasonal variation, but not price changes, and unadjusted estimates. On an adjusted basis, Q1 2010 retail e-commerce sales grew 14.3% from Q1 2009 e-commerce sales of $33.9 billion, and accounted for 4% of total sales of $960 billion. However, removing seasonal adjustments, Q1 2010 e-commerce sales were $36.6 billion, an 18.9% decrease from $42 billion in Q4 2009. On a year-over year unadjusted basis, Q1 2010 retail e-commerce sales increased 14% from Q1 2009 and accounted for 4.1% of total sales of $897 billion in Q1 2009.

Adjusted E-commerce Sales Show Steady Quarterly Growth

Adjusted for seasonal variation, retail e-commerce sales have shown a steady quarter-over-quarter growth pattern for the past year. In Q1 2009, adjusted e-commerce sales grew 1.7% to $33.9 billion, and then grew another 2.8% to $34.8 billion in Q2 2009. This was followed by 5.1% growth to $36.6 billion in Q3 2009, and then a 4.2% jump to $38.1 billion in Q4 2009. Year-over-year growth was less steady. Compared to the same quarters in 2008, adjusted retail e-commerce sales dropped 6.6% in Q1 2009 and 4.8% in Q2 2009. Positive year-over-year growth occurred in the third (1.7%) and fourth (14.6%) quarters.

Unadjusted E-commerce Sales Show Varied Results

In contrast to the fairly stable adjusted results, unadjusted retail e-commerce sales show much wider variance on both a quarter-over-quarter and year-over-year basis. In Q1 2009, unadjusted e-commerce sales totaled $32.1 billion, an 18.3% drop from the prior quarter and 7% drop from the prior year. Q2 2009 unadjusted retail e-commerce sales totaled $32.8 billion, a 2% quarterly increase but 5.2% annual decline. In Q3 2009, unadjusted retail e-commerce sales were $34 billion, representing 3.9% quarterly growth and 1.6% annual growth. Fourth quarter unadjusted results were $42 billion, representing much higher 32.8% quarterly growth and 15% annual growth.

comScore Tracks almost $34B in Q1 E-commerce Spending

U.S. retail e-commerce spending neared $34 billion in Q1 2010, according to data (based on different metrics) from comScore.

Retail E-commerce Spending Rises 10% Year-over-year

comScore estimates indicate that US retail e-commerce spending from home, work and university locations totaled $33.98 billion in Q1 2010. This represents a 10% increase from $31.03 billion in Q1 2009 and a 13% decrease from $39.05 billion in Q4 2009. The strong year-over-year acceleration marks the first time annual growth rates have hit double digits since retail e-commerce sales rose 13% in Q2 2008.

Upper Income Households Spur Growth

Although Q1 2010 returned the US retail e-commerce market to double-digit growth, comScore Chairman Gian Fulgoni said there is no guarantee this growth will continue. "While these spending gains provide reason for optimism, we should note that upper-income households are currently shouldering much of the growth," said Fulgoni. "Should the economy falter in the second half of the year and upper-income consumers return to a savings mode, we could still see growth decelerate. But for the time being, this momentum is encouraging."

Other Q1 Highlights

  • Growth in the first quarter was predominantly driven by upper-income consumers, with spending among the $100,000-plus household income segment up 14%.
  • Pure play (online-only) retailers continued to gain e-commerce spending market share from multichannel retailers.
  • Larger online retailers continued to generate higher growth rates than smaller retailers, but the smaller retailers are finally beginning to see positive growth once again.
About the comScore Data: Retail e-commerce growth rates exclude the travel, auction, auto and large corporate purchase segments.

E-commerce Fraud Losses Drop

E-commerce fraud appears to be on the wane, according to a recent survey from payment management solutions provider CyberSource. According to the "11th Annual Online Fraud Report," projected 2009 fraud losses to U.S. and Canadian online retailers is $3.3 billion USD, a 17.5% decline from $4 billion USD worth of fraud losses reported in 2008. This is the first drop in estimated e-commerce fraud losses since 2003. In addition, online retailers projected they would lose 1.2% of their online revenue to fraud this year, compared to a rate of 1.4% reported from 2006-2008. This is the lowest percentage revenue loss in the history of the survey.

Chart: E-commerce as a percentage of overall U.S. retail sales

Tags: Research, E-Commerce
E-commerce as a percentage of overall U.S. retail sales
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