Salesforce: Inflation drives up online revenue even as consumers buy less

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In February 2021, US consumers were less likely to shop online.

U.S. consumers placed fewer orders and purchased fewer items in February 2022 than in the same month a year earlier, according to consumer shopping data using Salesforce Commerce Cloud,

However, as inflation drove up prices, US retailers saw their online revenue increase by 6% year-on-year (YoY). On the other hand, global online revenue recorded a 5% year-on-year decline over the same period. Salesforce says rBoth retailers and consumers face higher prices as labor, inventory issues and last-mile costs drive up the cost of goods.

Specific online sales data points uncovered by Salesforce for February 2022 include:

  • February the volume of online orders decreased by 11% year-on-year and the number of items per order decreased by 1.3% year-on-year (3.79 items, compared to 3.84 items in 2021).
  • Prices for consumers in the United States rose 11.2% year-on-year in February, while world prices rose 4.4% year-on-year.
  • Product inventories in February were down -1% in the US and -5% globally as retailers and consumers continued to grapple with supply chain issues.

[Read more: Study: 98% of retailers having supply chain issues; will last beyond 2022]

Product categories with the strongest price growth in February YOY include:

    • Home, Furniture (21.8%).
    • House, appliances (17.9%).
    • Home, catering, art and decoration (11%).

Product categories with the lowest year-over-year price growth in February include:

    • Active footwear (1.3%)
    • General Footwear (.8%)
    • Electronics and accessories (0.5%)

eMarketer: e-commerce sales growth will continue throughout the year
Use-trade sales will exceed $1 trillion for the first time in 2022, totaling $1.065 trillion and representing 15.9% of total retail sales, according to a forecast by eMarketer’s Insider Intelligence. eMarketer also predicts that the average spend per digital buyer will grow at a compound annual growth rate of 11.6% between 2022 and 2025 to nearly $7,000. This compares to a projected CAGR of 1.9% for the total number of digital buyers

In 2021, e-commerce totaled $919.06 billion and accounted for 14.2% of total sales, according to data from eMarketer. Additionally, the increase in time spent on mobile devices is expected to trickle down to purchases, with mobile customers accounting for more than four out of every 10 dollars in first-time e-commerce. The biggest beneficiary will be smartphones, which are expected to account for 85% of mobile commerce sales this year.

“The challenges consumers faced over the holidays, including inflation and low inventory, have not dissipated in the new year,” said Rob Garf, vice president and general manager of commerce at retail, Salesforce. “As digital commerce continues to prevail, inflation is clearly impacting overall consumer spending. With these continued headwinds, retailers need to eliminate friction and improve experiences by combining offline and online shopping. »

The Salesforce Shopping Index tracks the activity of over 1 billion shoppers in over 54 countries who use Salesforce Commerce Cloud. Several factors are then applied to extrapolate projections and actual figures for the entire retail sector.

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