U.S. shoppers spent $131.2 billion online in Q4 2017, a 20.0% increase from $109.3 billion in Q4 2016, according to market research firm comScore Inc.
Of this $131.2 billion, sales from mobile devices (smartphones plus tablets) totaled $31.8 billion, a 40.1% increase from $22.7 billion in Q4 2016, while desktop sales reached $99.4 billion during the 2017 holiday season, up 14.8% from $86.6 billion a year earlier. This means that mobile devices accounted for 24% of e-commerce sales in Q4 2017, up from 21% in Q4 2016 and 17% in Q4 2015.
“Mobile is the key driver of digital retail growth,” Ryan Williams, head of client insights, retail, travel and CPG at comScore, said today on a webinar recapping the quarter.
Both desktop’s 15% growth and mobile’s 40% year-over-year growth rate surpass bricks-and-mortar’s Q4 growth of 7% year over year, according to comScore.
Still, mobile sales lag behind their share of time spent on site, as mobile devices account for 64% of minutes on a retail site but only 24% of dollars. While the gap will eventually get smaller, shoppers are still concerned about security on mobile devices, mobile shopping is often a sub-par experience compared with desktop shopping, and consumers are not comfortable buying big ticket items on small screens, Williams says.
Mobile apps also contributed to mobile sales. In fact, when looking at top e-commerce sites, such as those of Amazon.com Inc. or Walmart Inc., more shoppers spend time in the retailer’s app than on the retailer’s mobile site. For example, apps account for 78% of mobile minutes spent with Amazon compared with 22% on the retailer’s mobile websites, and 74% of Walmart’s mobile minutes are spent in app compared with 26% on mobile web.
ComScore estimates that 95.4 million unique shoppers used the Amazon app in December 2017, dwarfing its competitors. By comparison, the Walmart app attracted 37.7 million unique shoppers, eBay Inc.’s app 30.2 million and Target Corp.’s app 18.7 million.
Still, those numbers represent strong app penetration, Williams says. “Having an app on your phone is a good indicator of loyalty,” he says. “Once the app is on the device, the likelihood of its saying there is strong.”
The big shopping holidays around Thanksgiving, including Black Friday and Cyber Monday, were large drivers of spending growth for the 2017 holiday season. Desktop sales increased 21% on Thanksgiving, 20% on Black Friday and 26% on Cyber Monday, compared with the comparable days in 2016.
Overall, shoppers were not afraid to buy big-ticket items online. 23% of consumers said they bought a product that was more than $500 online in Q4, according to a January 2018 comScore survey of 2,247 consumers. Big-ticket product categories include electronics, appliances/furniture and jewelry.
Web giant Amazon.com Inc. flexed its might and accounted for at least 60% of Q4 2017 transactions in 11 key retail categories. What’s more, in six of those categories, Amazon increased its share by at least 5 percentage points. For example, Amazon accounted for 65% of the apparel and accessories transactions in Q4 2017, up from 51% last year; 81% of the consumer packaged goods transactions, up from 76%; and 75% of the furniture, appliances and equipment transactions, up from 70%. Amazon is No. 1 in the Internet Retailer 2017 Top 500.
Even if Amazon did not end up with the sale, shoppers often checked Amazon before buying elsewhere, comScore found by tracking the clicks of web shoppers. For example, 68% of consumers who made an online retail purchase not at Amazon visited Amazon in the seven days leading up to their transaction. 41% of the time, Amazon was the first retail site the shopper visited in the seven days leading up to the non-Amazon purchase, and 28% of consumers visited Amazon during the same session in which they made a purchase on another retail website.
Apparel was one of the fastest-growing categories, with Q4 sales increasing 27% year over year, according to comScore data.
“Apparel is killing it these days,” Williams says.
Online shoppers also bought a lot more home furnishings during the last three months of 2017, generating year-over-year growth of 21%, according to comScore data. In fact, in eight of the past nine quarters, online sales of home furnishings have increased more than 20% year over year.
ComScore also found that 65% of transactions shipped for free in Q4, up from 60% of transactions last year.