- Signaling the long-term growth of e-commerce, online retail sales in the United States are expected to reach $1.6 trillion by 2027 and the entire retail sector will generate $5.5 trillion by 2027, a new Forrester report predicts. The company also predicts that online retail sales in the United States will exceed $1 trillion this year.
- BOnline, in-store pickup transactions will reach $100 billion this year and exceed $200 billion by 2027, the company predicts.
- The company’s research predicts that offline retail sales will account for 70% of total retail sales by 2027.
Overview of the dive:
While the COVID-19 pandemic drove the rapid rise of e-commerce in 2020, some retail growth shifted from online to offline in 2021, Forrester noted. Physical retail sales increased 14% in 2021 compared to 2020, according to the report.
Forrester attributed e-commerce growth in 2022 to lower prices, a fuller product assortment, faster deliveries and simplified transaction convenience as the online retail environment returns to levels before the coronavirus pandemic.
Forrester’s research echoes previous reports that online spending could reach $1 trillion in 2022. Adobe Digital Economy Index Report, published in March 2021, predicted that e-commerce sales would reach $1 trillion this year and found that 30% of online shoppers would prefer to use BOPIS or curbside pickup over delivery. Another one report published last month by FTI Consulting forecasts online retail sales to reach $1.07 trillion this year, which the company previously forecast in 2025.
While lower prices would be a welcome change for consumers facing inflation, Forrester noted in its report that retailers’ profits could be hurt due to excess inventory or consumer concerns about inflation. Target, along with other major retailers, had to reassess financial expectations in a context of rising inflation and overflow of products.