In the first six months of the year, consumers spent $347.26 billion online with U.S. retailers, up 30.1% from $266.84 billion for the same period in 2019, according to the latest Digital Commerce 360 analysis of U.S. Department of Commerce data. Comparatively, ecommerce sales during the first half of 2019 grew just 12.7% year over year.
Online spending represented 18.6% of total retail sales for the first two quarters of 2020.
The spike in ecommerce sales largely came from consumer spending habits in the second quarter, which was plagued by the height of the coronavirus pandemic that caused widespread store closures and stay-at-home orders. The first quarter of the year captured only 2.5 weeks of retail spending after President Donald Trump declared a state of national emergency on March 13, whereas Q2 captured a full 3-month period of shopping behavior during COVID-19.
$200.72 billion was spent online with U.S. retailers in Q2, up 44.4% year over year. That means $1 in every $5 spent came from orders placed on the web during the April-June period. Ecommerce penetration hit 20.8% in Q2, up from 14.7% in Q2 2019 and 16.2% in Q1 2020.
Year-over-year online sales growth slowed in July—the first month of Q3 and when many stores opened across the country—compared with June, Adobe Analytics data shows. Ecommerce sales were up 55% to $66.3 billion in July compared with July 2019, which is a slowdown from June 2020 when online sales were up 76% to $73.0 billion year over year.
Adobe’s data is based on more than 1 trillion anonymous online visits to retail sites, including 80 of the top 100 retailers in the Digital Commerce 360 Top 1000, and covers more than 100 million SKUs.
Bankrupt retailers amid coronavirus pandemic
21 North American retailers filed for bankruptcy protection thus far in 2020. 17 of those retailers filed during the COVID-19 outbreak in the U.S. Lockdowns and store closures have drained revenue, pushing already-struggling companies like J.C. Penney Co. Inc., J. Crew Group Inc. and Neiman Marcus Group Inc. into bankruptcy.
Most recently, discount retailer Stein Mart filed for Chapter 11 bankruptcy protection mid-August and will close all of its 279 stores in the U.S. Stein Mart may sell its ecommerce operations and related intellectual property amid its liquidation process, the company said. Stein Mart is No. 478 in the Digital Commerce 360 Top 1000.
The oldest U.S. department store Lord & Taylor filed for Chapter 11 protection in early August. Lord & Taylor’s owner, web-only apparel retailer Le Tote Inc., filed with the retail chain. Le Tote (No. 835) bought the rights to the company’s stores, brand and ecommerce site from Fifth Avenue owner Hudson’s Bay Co. for $71 million last year.
Tailored Brands Inc. (No. 150), the owner of Men’s Wearhouse and Jos. A. Bank, filed for bankruptcy protection in early August as well, after the coronavirus lockdown kept America’s office workers at home, putting a damper on demand for new suits.
Statewide lockdowns, store closures and the fear of contracting the coronavirus have kept consumers from shopping in stores. As a result, many retailers launched curbside pickup as a way to get products to consumers safely. While this omnichannel trend has been on the rise for the past couple years, many store retailers launched curbside amid the pandemic.
As of August 2020, 43.7% of the 245 retailers with stores ranked in the Digital Commerce 360 Top 500 offer curbside pickup, a sharp increase from 6.9% at the end of 2019.
Most recently, BJ’s Wholesale Club (No. 333) announced on Aug. 21 the launch of contactless curbside pickup at all of the retailer’s locations.
What’s more, large retailers that offered curbside pickup prior to the pandemic touted growth in consumers using the feature in Q2. Target Corp. (No. 12) said web orders fulfilled through curbside pickup grew 734% in its fiscal Q2 ended Aug. 1. Similarly, The Home Depot Inc. (No. 5) had triple-digit growth in curbside delivery during its Q2 ended Aug. 2.
Amazon’s traffic during COVID-19
Amazon.com Inc., the largest North American online retailer, continues to see increased traffic to its site even as statewide stay-at-home orders lift and stores reopen. In July, site traffic was up 28.1% compared with February 2020 and up 8.7% year over year, according to Digital Commerce 360’s analysis of traffic data from web measurement firm SimilarWeb. It’s important to note that traffic is up year over year despite Amazon postponing its annual Prime Day sales event, which was held in July 2019, to the fall in 2020.
We compared monthly traffic to the same month the previous year as well as to February 2020. This allows us to compare shopper behavior right before the pandemic hit the U.S.
Looking at Amazon’s traffic growth month over month, June total site visits were down 5.4% compared with May—the only month since February that declined. July bounced back up 8.7% compared with June traffic.
U.S. marketplace sellers sold 3.4 billion products in the last 12 months ended May 31—a time period that includes the start and height of the coronavirus pandemic. Over the same period, Amazon’s marketplace sellers averaged $160,000 in annual sales, compared with $100,000 in the same period a year prior, Amazon reported in its annual Small Business Impact report.
Since mid-March, marketplace sellers hit “record sales,” Amazon reports. While the company didn’t specify U.S. sales figures, it did say marketplace products account for more than 50% of all units sold on Amazon, and marketplace sales continue to outpace first-party sales. (First-party items are inventory owned by Amazon, including its private-label goods and products Amazon purchased from retailers and brands.)
For more data and insights on how the coronavirus has impacted large retail, purchase the latest editions of Digital Commerce 360’s Online Apparel, Online Marketplaces and Online Food reports. DC360 Gold and Platinum members get immediate access to all three reports as part of their membership. Reports can be purchased individually for $399. View all Digital Commerce 360 reports available for purchase here.