US online sales growth topping at least 30% looks set to power high double-digit growth in consumer package volumes over the forthcoming Thanksgiving Day/Black Friday/Cyber Monday sales period and throughout this year’s holiday season, according to new surveys.
As US consumers shop online more than ever before, the big parcel carriers, including the US Postal Service, UPS, FedEx and DHL as well as regional operators, are all gearing up with increased capacity and resources to handle a ‘historic high’ in volumes and avoid a hyped ‘shipageddon’ where delivery capabilities could be overwhelmed.
E-commerce up a third in Q3
The National Retail Federation (NRF) yesterday predicted that online and other non-store sales will increase by 20-30% to between $202.5 billion and $218.4 billion during November and December, up from $168.7 billion last year. This would drive overall US retail growth of between 3.6% and 5.2% to a total between $755.3 billion and $766.7 billion.
With ecommerce sales up 36.7% year-over-year during the third quarter, many households are expected to depend on digital shopping to make many of their holiday purchases, just as they have for much of their everyday spending this year. The online spending includes websites operated by bricks-and-mortar retailers, which have become major players in the online market as retail channels have merged, the association pointed out.
“We know this holiday season will be unlike any other, and retailers have planned ahead by investing billions of dollars to ensure the health and safety of their employees and customers,” said NRF President and CEO Matthew Shay. “Consumers have shown they are excited about the holidays and are willing to spend on gifts that lift the spirits of family and friends after such a challenging year. We expect a strong finish to the holiday season, and will continue to work with municipal and state officials to keep retailers open and the economy moving forward at this critical time.”
Shopping “from the safety of the couch”
The NRF’s e-commerce growth forecast is very close to yesterday’s predictions from US market researchers Digital Commerce 360, which said that nearly one third of total US spending over the five-day period from Thanksgiving Day through Cyber Monday will come from online purchases.
“With the coronavirus pandemic causing many stores to close on key shopping days as retailers grapple with how to limit crowds on other high-traffic dates to avoid spreading the virus, shoppers will have both the time and inclination to seek deals from the safety of their couches this year,” it commented.
US consumers are set to spend a record $38.21 billion online during the five-day stretch, a “huge” 34.9% more than last year’s $28.33 billion figure (which itself was a 18.4% increase on 2018), Digital Commerce 360 predicted.
The fastest-growing day for the period will be Thanksgiving, which will increase its smaller weekend revenue by 40.1% year over year to reach $5.86 billion in online sales, according to the researchers. But the big story will be Black Friday when ecommerce will grow 38.5% over 2019 to hit $10.23 billion. Cyber Monday will still reign supreme, remaining the biggest online shopping day of the year with $12.16 billion and registering 29.8% growth.
Earlier purchases to avoid delivery delays?
There were already similar growth forecasts from researchers eMarketer at the end of last month. They predicted that US online retail spending would soar by 35.8% to $190.5 billion during the November – December 2020 holiday season while in–store holiday sales would decline by 4.7% to $822.8, resulting in low overall growth of 0.9% to just over $1 trillion. This would include a 39.6% rise to online sales of $39.10 billion during the ‘Cyber Five’ promotional period, from Thanksgiving Day through Cyber Monday.
“This holiday season will see a continuation of the channel shift to ecommerce, as shoppers look to avoid crowds and minimize their number of in-person shopping trips,” said Andrew Lipsman, eMarketer principal analyst at Insider Intelligence.
“With these huge gains expected, there’s growing concern around the potential for ‘shippageddon,’ where high package volumes overwhelm logistics capacity and result in deliveries arriving after Christmas. We believe that shoppers will pull forward more of their purchases than they typically do and shift ecommerce buying to click-and-collect orders over the last 10 days of the season to prevent these scenarios,” he emphasised.
