In the fourth quarter and in 2017 as a whole, U.S. online retail grew faster than it has since 2011. E-commerce represented 13% of total retail sales in 2017 and 49% of the growth. Amazon is responsible for much of the gains.

A blockbuster fourth quarter contributed to the strongest year-over-year growth for U.S. ecommerce in six years, according to a report released this morning from the U.S. Commerce Department.

Consumers spent $453.46 billion on the web for retail purchases in 2017, a 16.0% increase compared with $390.99 billion in 2016. That’s the highest growth rate since 2011, when online sales grew 17.5% over 2010.

It was a strong year for the broader retail market in the U.S., as total retail sales reached $5.076 trillion for the year, a 4.4% jump from $4.863 trillion in 2016. That’s a significant improvement from 2016, when total retail sales grew 2.9% over the year prior.

These retail sales figures from the Commerce Department include the sale of items not normally bought online, however, including fuel and automobiles. When factoring these items out of the total retail sales figures, which Internet Retailer believes is the most accurate way to measure the impact of ecommerce on retail as a whole, total retail sales reached $3.496 trillion, a 3.8% increase compared with $3.369 trillion.


That would mean ecommerce represented 13.0% of total retail sales in 2017, a marked increase from 11.6% in 2016.

It also means that ecommerce represented roughly 49.4% of all retail sales growth in 2017 (versus 41.6% in 2016).

The bulk of the ecommerce’s gains stemmed from the growth of web leader Inc., as the e-commerce behemoth continues to gain loyalty among U.S. consumers and take market share from other merchants in multiple categories. Internet Retailer estimates that the total value of transactions from U.S. consumers on reached $189.61 billion last year (including sales of Amazon’s own products and of marketplace sellers), a 30.1% increase compared with $145.72 billion in 2016.


That means that Amazon comprised 70.2% of the $62.47 billion growth in U.S. online retail last year, and 34.7% of the $126.51 billion increase in the total retail market.

In the fourth quarter, U.S. ecommerce sales grew 16.8% to $143.11 billion from $122.52 billion. That’s the biggest year-over-year jump in online retail sales since the fourth quarter of 2011, which experienced an 18.2% year-over-year gain.


Total retail sales, factoring out the sales of automobiles, fuel and restaurants, reached $970.16 billion in the fourth quarter, a 4.9% increase compared with $925.20 billion in the fourth quarter of 2016. Ecommerce represented 14.8% of total retail sales in the fourth quarter, compared with 13.2% in the fourth quarter of 2016. Amazon is ranked No. 1 in the Internet Retailer Top 500.

In an ongoing effort to understand the most vital business strategies of merchants that sell online, Internet Retailer is taking a deep dive on conversion rate. Help us improve our estimates and category benchmarks by answering the two questions below. 

Fareeha Ali contributed reporting.