Online sales grew 15.1% in Q1 and accounted for 11.1% of retail sales  when factoring out items not normally bought online. That’s the highest e-commerce penetration in history.

The e-commerce market had another big quarter, as web sales totaled $86.3 billion for the period ended March 31, a 15.1% increase over $75.0 billion in the first quarter of 2015, according to non-adjusted estimates released this morning by the U.S. Department of Commerce.

The 15.1% growth is slightly ahead of growth on the web in Q4, and, along with Q3 2015’s growth of 15.1%, the highest year-over-year increase in e-commerce sales since the third quarter of 2014.

Total retail sales for the quarter grew 3.3% on a non-adjusted basis to $1.117 trillion from $1.081 trillion, when factoring out foodservice sales and sales at restaurants and bars. Online sales accounted for 7.7% of retail sales during the first quarter of 2016 versus 6.9% in 2015, and e-commerce accounted for 31.8% of total retail sales growth.

When further factoring out sales of automobiles and fuel—items not normally bought online—total retail sales grew by 5.3% ($39.0 billion) year over year to $775.8 billion from $736.9 billion last year. E-commerce grew by $11.3 billion on a non-adjusted basis, which means online sales accounted for 29.1% of retail sales growth online and offline.


By this definition, e-commerce comprised 11.1% of retail sales in the first quarter—a historic high— versus 10.2% in the first quarter of 2015.

Adjusted for seasonal variations, holiday and trading-day differences, the Commerce Department estimates Q1 web sales reached $92.80 billion, up 15.2% from $80.57 billion a year earlier. On an adjusted basis, e-commerce accounted for 11.2% of total Q1 retail sales excluding foodservice, automobiles and fuel, up from 10.1% in Q1 2015.

Analysts report more of those web transactions shifting to mobile. “Q1 e-commerce growth was strong relative to Q4 and we continued to see an acceleration in the shift to mobile shopping and commerce,” says Andrew Lipsman, vice president of marketing and insights at web measurement firm comScore Inc. “Of course, both desktop e-commerce and mobile commerce are far outpacing the growth in brick-and-mortar (but that’s nothing new).”

This quarterly report comes on the heels of a strong 2015 for e-commerce. Shoppers in the U.S. spent $341.73 billion on retail purchases on the web last year, according to the Commerce Department, up 14.6% from 2014. That’s a rate nearly five times as fast as the 3.1% growth in store sales.

Last year was the first on record that e-commerce accounted for more than 10% of retail sales when factoring out the sales of automobiles, fuel and foodservice.


A full analysis of the trends driving growth in e-commerce is available in the Internet Retailer 2016 Top 500 Guide.