E-Commerce saw remarkable growth over the course of 2015, with an increase of over 25% YoY and nearly $1.7 trillion in sales worldwide. Even more impressive, this growth occurred while worldwide brick-and-mortar retail sales growth slowed from 6.1% in 2014 to 5.6% in 2015.
The United States is often seen as the largest E-Commerce market in the world, generating an impressive $350 billion in sales in 2015. In reality, that figure does not land it the title of the largest E-Commerce market in the world, as that title belongs to China. Below are the top 5 E-Commerce markets in the world:
- China had over $560 billion in E-Commerce revenue in 2015. China has a population of 1.3 billion people and over 600 million internet users. Shopping is reported to be the fastest growing online activity in China, increasing by nearly 15% YoY, and with the average age of an internet user at 25, this is a generation that is very comfortable with using technology for everyday activities such as shopping.
- The United States had $350 billion in E-Commerce revenue and of the top 5 countries, representing growth of 14% YoY according to the U.S Department of Commerce. The US also had the highest percentage (72%) of online shopping that is done on a PC.
- The United Kingdom had $93 billion in E-Commerce revenue, and online sales account for 30% of the total economy.
- Japan had $79 billion in E-Commerce revenue. In Japan, over 95% of internet users regularly shop online.
- Germany had $74 billion in E-Commerce revenue, with nearly 50% of all online spending coming from two online retailers – Amazon and Otto.
In the US, mobile shopping had an impressive year in 2015, showing growth of over 30% in total sales YoY. Despite this impressive growth, mobile shopping still remains a somewhat underwhelming choice for US consumers, accounting for only around 20% of all E-Commerce sales. In comparison, China saw nearly 50% of all of its online shopping done on mobile devices.
The US may not be the largest E-Commerce market or have the highest concentration of mobile shoppers, but one area where the US continues to lead is in Omni-channel sales with 43% of major retailers offering in-store pickup of online orders.
We noted the impressive overall growth rates for E-Commerce sales for the US (and worldwide), however at an individual retail level, the results were not as impressive. In the US, 20% of online retailers reported flat sales for 2015, indicating no growth at all. With so many retailers reporting little to no growth, how did the E-Commerce market experience such impressive overall growth? ? What we have seen in the US, and to some extent worldwide, is a smaller number of retailers accounting for a significantly higher portion of total sales. In Germany, nearly 50% of ALL online sales in 2015 came from just two retailers (Amazon and Otto). In the US, we are currently seeing a pattern of consolidation as Amazon, E-Bay and Wal Mart continue to use their size and strength to grab a larger portion of all E-Commerce revenues:
- Amazon – 188 million monthly visitors. Worldwide E-Commerce sales for 2015 were $107 billion, an increase of over 20% YoY. 33% of sales were generated internationally, leaving an impressive $70.6 million in sales from North America.
eBay – 89 million monthly visitors. Worldwide E-Commerce sales for 2015 were $82 billion (Gross Merchandise Volume). Roughly 60% of eBay’s business is international which equates to $49.2 billion in E-Commerce sales from the US. eBay experienced relatively flat growth YoY worldwide and in the US.
- Wal Mart – 88 million monthly visitors. Worldwide E-Commerce sales for 2015 were $13.7 billion, an increase of 12% YoY. Wal-Mart did not release a regional breakdown of their E-Commerce sales for 2015, however roughly 60% of their total worldwide sales (which includes retail brick and mortar sales) of $486 billion in 2015 were international.
With Amazon and Wal Mart showing double digit growth (and eBay holding steady) we can see how a few large retailers accounted for the remarkable E-Commerce growth rate in the US, while many individual retailers may not have experienced such growth. Customers have grown to trust these retailers to always deliver any product they are looking for, at a reasonable price. Amazon, eBay and Wal Mart have made it extremely convenient to do all your shopping at one site, and a great example of that is the major shopping holidays.
Events like Black Friday, Cyber Monday and Holiday shopping in general significantly increase sales at a single online retailer as consumers prefer to do all their holiday shopping at a single store, enjoying the wide selection, convenience, and potential savings. Consider the following: according to data from Adobe, E-Commerce US spending reached $2.72 billion on Black Friday, $1.73 billion on Thanksgiving and $2.98 billion on Cyber Monday. All three of these days represent double digit increases year-over-year. While these sales figures are an aggregate of all US E-Commerce, according to at least one independent analysis, Amazon alone was responsible for roughly 50% of this double digit growth.
We would like to close out this 2015 recap by focusing for a moment on China, one of the fastest growing marketplace in the world. As impressive as the numbers for Black Friday, Cyber Monday and Thanksgiving might be for the US market, they actually pale in comparison to China’s shopping holidays. The largest shopping holiday in China is Singles Day, which occurs on November 11. Alibaba has been instrumental in promoting the day, but retailers all over China participate in what has truly become the largest shopping holiday in the world. Exactly how much in online sales did Alibaba generate on Singles day in 2015? See the comparison below:
- China’s Singles Day – $14.3 billion
- US Holiday Shopping season (aggregate) – $7.43 billion
In a single day, China generated nearly 100% more in E-Commerce sales than the US generated during the entire holiday shopping season!
We are excited to see the E-Commerce industry continue to grow at an astounding pace while hundreds of new and existing companies continue to innovate and improve this market. Consumers continue to enjoy the fruits of this fast paced industry as the strong shift to mobile is continuously increasing the convenience and speed of online commerce. We cant wait to see how you will help E-Commerce grow in 2016!