The 2022 Digital Commerce 360 Next 1000 is a ranking of online small- and medium-sized online retailers by web sales. These merchants rank as the Nos. 1,001 - 2,000 online SMBs selling in North America. These ecommerce merchants have annual online sales between $1 million and $39 million. 

In 2020, the pandemic left consumers little choice but to become comfortable shopping online as in-person shopping opportunities disappeared. Consumers remained comfortable shopping online in 2021 even as in-person shopping opportunities reemerged. Shoppers expanded their choices to include more small- and medium-sized online retailers in 2021, and that trend continues into 2022.

Digital Commerce 360 ranks small and medium-sized retail businesses, or SMBs, by their web sales in the 2022 Digital Commerce 360 Next 1000, the latest edition of our annual report. The 2022 Next 1000 includes online retailers that generated annual ecommerce revenue between roughly $1 million and just over $39 million in 2021.

Collectively, the Next 1000 merchants posted year-over-year web sales growth of 22.8% in 2021. That was higher than their 19.9% web sales growth in 2020 and 16.7% growth in pre-pandemic 2019. Over the two years of the pandemic, Next 1000 merchants’ online sales increased 47.2%.

Leading online SMBs

The top five online SMB retailers are:

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  • Toys/hobbies merchant Lion Brand Yarn (No. 1001)
  • Hardware/home improvement merchant House of Antique Hardware Inc. (No. 1002)
  • Office supplies merchant Jam Paper & Envelope (No. 1003)
  • Apparel and accessories retailer Baitme.com (No. 1004)
  • Jewelry merchant Whiteflash Inc. (No. 1005)

Next 1000 SMBs surpass 2021 U.S. ecommerce growth

Merchants with physical stores were largely able to reopen their locations in 2021. This allowed shoppers to once again choose between shopping in store versus online. The fact that 2021 growth remained above the 2019 level, despite store reopenings, demonstrates that shoppers grew increasingly comfortable shopping online during the pandemic and likely will continue to do so.

Small- to medium-sized merchants grew at a higher rate in 2021 compared with the Digital Commerce 360 Top 1000 retailers, which are large, well-known merchants like Amazon.com Inc. and Walmart Inc. That’s a departure from 2020, when the Top 1000 retailers experienced explosive ecommerce growth of 44.8% compared with the Next 1000’s 19.9%.

Online retail sales growth slowed to 17.8% in 2021 compared with 42.8% in 2020, according to Digital Commerce 360’s analysis of U.S. Department of Commerce data. After trailing the market with only 19.9% growth in 2020, Next 1000 retailers surpassed the growth of U.S. ecommerce in 2021, growing 22.8% year over year. In addition, the Next 1000 also exceeded the 15.7% online growth of Top 1000 retailers in 2021 and the 14.4% of total U.S. retail sales.

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Year two of COVID-19

Year two of the pandemic reflected a shift in consumer shopping preferences. Inflation and price increases for necessities like fuel and groceries left shoppers with less to spend on other products. Still, the Next 1000 retailers in the apparel/accessories (27.8%), housewares/home furnishings (27.7%) and hardware/home improvement (26.5%) all experienced web sales growth of around 27% in 2021.

In 2020, toys/hobbies (35.5%), hardware/home improvement (34.5%), and food/beverage (34.4%) topped the categories in web sales growth. Many consumers spent a good portion of 2020 indoors due to the pandemic. As a result, they spent more on recreation and dining, and invested in their home décor accordingly.

In 2021, consumers continued to invest in their homes. They did this by upgrading furnishings or bedding (the mattresses subcategory increased online sales 44.1% year over year). They also enhanced their home lighting (bulbs/lighting increased 41.5% year over year), went back to in-person sports (organized sports spending increased 38.1% year over year) and bought more items for their children, especially as in-person school resumed (the children’s apparel subcategory grew 36.9% year over year). And even compared to the first year of the pandemic, toys for children remained a spending priority for consumers in 2021. The toys subcategory grew 36.6% year over year.

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Shoppers also shifted their spending budgets toward travel and dining out in 2021, as vaccines enabled many restaurants to reopen and airlines experienced a surge in travelers. According to the U.S. Bureau of Transportation Statistics, U.S. airlines carried 674 million passengers (not seasonally adjusted) in 2021. That’s 82.5% more than in 2020 (369 million unadjusted).

The 2022 Next 1000 Report delves into why online SMBs fared better in 2021 when compared to larger merchants and the ecommerce industry as a whole.

2022 Digital Commerce 360 Next 1000 Report includes:

  • Rankings by category and subcategory of North America’s leading online retailers ranked 1,001-2,000
  • 100+ data-packed charts and graphics on merchant category growth and much more
  • Detailed analysis of the fastest growers, newcomers, latest omnichannel offerings and 2021 challenges, like inflation and supply and fuel costs
  • Category and merchant type data analysis for online SMBs
  • Breakout sections on 2022 challenges, marketplaces and customer acquisition and experience
  • Exclusive interviews with Next 1000 ecommerce executives
  • View the table of contents for full details on what’s included in the report.

The 2022 Next 1000 Report can be downloaded now as a PDF for $499. Digital Commerce 360 Gold and Platinum Members receive a complimentary copy of this report as a part of their membership.

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