Successful E-Comm Holiday Paves the Way for 2016

1/5/2016
CloudCommerce, Inc., focused on building and maintaining powerful e-commerce stores for brands, reviewed several industry reports showing a successful holiday season for the e-commerce industry.

MasterCard reported that U.S. retail sales grew by a solid 7.9 percent this holiday season, fueled by strong online sales and demand for furniture and women's apparel. Online sales alone grew 20 percent in the holiday season this year.

Amazon shipped to 185 different countries this holiday season, and announced that three million new members worldwide joined Prime during the third week of December alone. The company's Prime Now service, which promises two-hour deliveries, was reportedly taking online orders until 11:59 pm on Christmas Eve. Slice Intelligence said that Amazon accounted for 35.7 percent of all Black Friday Sales, with Best Buy second at just 8.2 percent and Macy's third at 3.4 percent.

According to Slice Intelligence, which tracks receipt data from U.S. online shoppers, Wayfair, the Boston-based home goods e-tailer, saw the largest increase in Black Friday sales, year-over-year, of any online retailer. Wayfair's Black Friday sales were reported to be 315 percent higher than during Black Friday 2014, with a 130 percent increase in direct-retail sales.

Around the globe, major growth can be seen emerging in the business-to-business (B2B) e-commerce sector. Inspired by the tremendous success of Alibaba, the Indian government is reportedly working to establish a massive international B2B e-commerce hub for importing and exporting. Several features of Alibaba's online portal are expected to be incorporated into this new project. Alibaba has made major moves to tap into the Indian B2B market, launching programs such as SMILE to provide one-stop solution for all Indian SMEs (which include shipping, finance, mentorship and more), and by signing a memorandum of understanding with the Confederation of Indian Industry to facilitate greater economic cooperation among Indian and Chinese vendors.

Chinese growth continues. A study done by iResearch revealed that online shopping and B2B e-commerce drive roughly 53 percent of China's 3rd-party online payment sector. The e-commerce sector in China has seen a substantial increase in online shopping and B2B e-commerce gross merchant volume, with online shopping capturing 25 percent of online payments in Q2 2015, followed in turn by fund purchase at 21.5 percent, air travel ticketing at 10.9 percent, payment for telecom fees at 3.9 percent, B2B e-commerce at 6 percent.

Chinese e-commerce merchant Vipshop Holdings is an online discount marketplace that uses flash sales. The first Chinese B2C e-commerce company to achieve profitability, Vipshop controlled 2.8 percent of the Chinese B2C market in 2014, compared to JD.com's 21.2 percent share. On mobile devices, its number of active customers and orders rose 137 percent and 141 percent annually. Vipshop's number of active customers rose 48 percent to 14.6 million and their revenue has risen 63 percent annually to $1.36 billion.

E-commerce is reportedly one of the fastest-growing industries in the world. According to market research firm eMarketer, global consumers will spend $1.672 trillion online this year, and by 2019, online purchases are projected to more than double to $3.551 trillion, which will include roughly 12.4 percent of overall retail sales worth $28.550 trillion. According to Fitch Ratings' 2016 U.S. retail outlook, e-Commerce will account for 15 percent of total retail sales and 50 percent growth in total retail spending in 2016. "The e-commerce industry is a force that no investor can afford to ignore," said Cushla Sherlock, of Credit-Suisse.


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