E-commerce is expected to build on its strong 2020 performance, with strong Prime Day sales contributing.
According to the new 2021 U.S. Online Retail Forecast from global business advisory firm FTI Consulting Inc., U.S. online retail sales will reach $865 billion in 2021, with nearly two-thirds of Amazon Prime Day shoppers surveyed saying they intend to spend more during this year’s event than they did in 2020.
The projected 2021 online retail sales total is a 13.5% increase over 2020, following up 2020’s pandemic-fueled 32% increase. The online channel’s share of U.S. retail sales (excluding auto and gas) is expected to reach 20.5% in 2021, compared to 19% in 2020 and 15.4% in 2019. U.S. online market share is expected to reach 33% by the end of the decade.
“As Americans begin to emerge from COVID-related restrictions, many have been converted to online shoppers as their confidence in online shopping increased the past year, particularly in the grocery category,” said Christa Hart, senior managing director in the retail & consumer products practice at FTI Consulting. “While malls and other shopping centers are seeing a return of shoppers in 2021, it is hard to imagine that they will be the same as we remember them. Those retailers who have spent years positioning themselves for omnichannel success will be rewarded most.”
In addition, in an FTI survey of 1,000 U.S. consumers who made a purchase during Prime Day in 2020, 62% said they would spend more this year on Prime Day than they did last year, including 36% who said they intend to spend significantly more. Only 9% of those surveyed said they would spend less on Prime Day 2021.
Most survey respondents said they intend to spend more on apparel and accessories than any other product category. The survey of Prime Day shoppers also showed that 41% of respondents say they will shop online as often as they did during the pandemic, while another 25% said they will shop online less than in 2020 but more than in 2019.
Just 16% of respondents said they missed in-store shopping and will revert to their pre-pandemic shopping habits, while another 18% still preferred in-store shopping for certain product categories.