US e-commerce market to hit $1,574.5bn in 2022 • eCommerce Forum | Forum Events Ltd
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  • US e-commerce market to hit $1,574.5bn in 2022

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    E-commerce sales in the United States are expected to grow by 11.8% on annual basis to reach $1,574.5 billion in 2022.

    A new report from ResearchAndMarkets asserts that B2C e-commerce is expected to grow steadily over the forecast period, recording a CAGR of 10.22% during 2022-2026. The country’s B2C Ecommerce Gross Merchandise Value will increase from US$1,408.3 billion in 2021 to reach US$2,323.9 billion by 2026.

    In the United States, the B2C e-commerce industry is expected to hold on to the global pandemic accelerated sales in 2022, with big retailers, including Amazon and Walmart, set to benefit from the growing online shopping trends among consumers in the country. While the growth in sales declined in 2021, the total purchases remained far above the pre-pandemic levels.

    This growth rate fall also reflects that consumers returned in-store for their purchases in 2021. While the in-store sales gained momentum last year, shoppers continued to purchase their products online with the same enthusiasm.

    The growing comfort of online shopping coupled with enhanced fulfillment and delivery services offered by e-commerce providers is expected to further support the online shopping trend in the United States over the next three to four years.

    To enter the market with high barriers, United States-based e-commerce marketplaces are entering into mergers and acquisition deals.

    In June 2021, Etsy, one of the leading e-commerce marketplaces, announced that the firm had acquired Elo7, a Brazil-based handcrafted goods marketplace, for US$217 million. This acquisition is expected to help Etsy in growing its foothold in the Latin American market, a region with high barriers to entry.

    In June 2021, Etsy acquired Depop, a United Kingdom-based apparel shopping app, for US$1.63 billion. Through the acquisition of Depop, Etsy is targeting to improve the consumer experience, thereby seeking to increase the conversion rate and growth of the business in the region. The acquisition of Depop will also help Etsy to target Gen Z consumers globally. Depop is the 10th most visited shopping site among Gen Z consumers in the United States.

    The metaverse has the potential to reshape the e-commerce industry entirely. Apart from offering instant gratification, the combination of metaverse and e-commerce can also greatly influence customer purchase decisions and increase customer satisfaction. Consequently, to create an enhanced shopping experience for their customers, many players in the e-commerce segment are investing and innovating in the metaverse space.

    In December 2021, Walmart, one of the leading retailers in the country, filed for several trademarks, thereby suggesting plans to start selling virtual goods, including toys, appliances, electronics, apparel, sporting equipment, home decor, and much more. In addition to this, and as reported by Bloomberg, Walmart has also filed trademarks for the names Verse to Curb, Verse to Home, and Verse to Store, a hint that the firm may be preparing for a virtual shopping experience.

    All of these indicate that the leading retailer in the country is looking to enhance the shopping experience of its customer through innovative and emerging technologies. Notably, Walmart is not the only player investing in new technologies. Amazon has its presence in the metaverse segment as well.

    With Amazon AR View, the online e-commerce marketplace has already started incorporating metaverse technology into its digital platform. The AR View allows shoppers to design and decorate their homes using augmented reality. Every product that AR View supports is sized and rendered to scale. This allows shoppers to know exactly how large the product is.

    The United States online travel market is dominated by big players such as Expedia, Booking, and Airbnb. However, the segment also has a presence of several innovative startups that are looking to tap into the high-growth potential market. Consequently, these firms are raising funding rounds to further accelerate their growth in the online travel sector.

    In February 2022, Headout, a New York City-based startup that runs an app for booking experiences, announced that the firm had raised US$30 million in its Series B funding round. The funding round was led by Glade Brook Capital. Before raising US$30 million, the startup also raised US$12 million, which was also led by Glade Brook Capital. In 2021, the startup recorded a growth of over 800%. With this funding round, the startup aims to further accelerate its growth over the next three to four years.

    In February 2022, Captain, another startup that allows people to book outdoor travel experiences in the United States, announced that the firm had raised US$2 million in its seed funding round.

    As competition in the online food delivery market continues to grow in the United States, players are seeking ways to diversify their existing business, which will also help them to grow their market share.

    To diversify its existing business, Uber launched a grocery delivery service and also piloted same-day delivery in a strategic partnership with Costco. In addition to this, Uber also expanded its prescription delivery collaboration with Nimble and acquired Drizly, an alcohol delivery firm. Moreover, to further consolidate its position in the segment and drive market share, the firm acquired Postmates in November 2020.

    On the other hand, DoorDash, the industry leader in the online food service segment, partnered with CVS as well as national and regional convenience stores to deliver household essentials. Moreover, DoorDash entered into a strategic collaboration with Albertsons to expand its grocery delivery offerings. In September 2021, DoorDash also announced that the firm was adding alcohol delivery services to its app.

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