Electronic Shopping
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 46,000 electronic shopping retailers in the US are online-only retailers, with no or limited-format physical stores. The business format ranges from the independent specialized seller with one or a few lines of products to the large conglomeration of businesses selling a broad range of products on a single e-commerce website (Amazon, Etsy). Websites that bring together third-party sellers are known as marketplaces and typically earn revenue by charging sellers a fee that is either fixed or based on a percentage of sales or a number of transactions.
Fierce Ecommerce Competition
Electronic shopping sites must find ways to stand out in an e-commerce market flooded with domestic and foreign retailers as well as dominant players like Amazon.
Delivery Race Slows
The need for speed in ecommerce delivery is easing with shoppers showing a greater willingness to wait for deliveries of household items as concerns grow over the cost of fulfillment.
Industry size & Structure
The average electronic shopping retailer operates out of a single location, employs 16 workers, and generates $25 million annually.
- The electronic shopping retailer industry consists of 46,000 companies that employ over 734,100 workers and generate $1.15 trillion annually.
- The industry is concentrated at the top and fragmented at the bottom with the top 20 firms accounting for about 53% of industry sales.
- Large companies include Amazon, eBay, Qurate, Etsy, Wayfair, and Zara. Many large companies have international operations.
Industry Forecast
Electronic Shopping Industry Growth
Recent Developments
Mar 25, 2024 - Consumer Confidence Falls
- Consumer confidence levels fell in February 2024 after increasing for three consecutive months, according to data from The Conference Board. The Conference Board’s consumer confidence index fell to 106.7 in February 2024 from 110.9 in January 2024. According to Dana Peterson, Chief Economist at The Conference Board, “The decline in consumer confidence in February interrupted a three-month rise, reflecting persistent uncertainty about the US economy. The drop in confidence was broad-based, affecting all income groups except households earning less than $15,000 and those earning more than $125,000.” Peterson added that the decline in consumer confidence was largest in householders over 55 and those under 35. Plans to purchase homes, autos, and large appliances decreased slightly on a six-month basis.
- According to a recent ConsumerSignals survey by Deloitte, about 75% of consumers worldwide have made at least one splurge purchase to treat themselves in the past month. The average amount spent on the last splurge purchase was $45. The survey examined consumer spending behavior and found that the three main drivers for splurge purchases were comfort (22%), relaxation (15%), and practicality/usefulness (12%). The most popular categories for splurge purchases included food and beverage (43%), clothing and accessories (18%), personal care (11%), electronics and accessories (8%), toys and hobbies (6%), health and wellness (5%), home and kitchen (3%), and household goods (3%). According to the Spending Intentions index, global total spending intentions remained consistent in January compared to December and were significantly higher than a year ago.
- A new report from the National Retail Federation and Appriss Retail shows returns for the retail industry reached $743 billion in merchandise in 2023, according to Chain Store Age. The rate in 2023 was 14.5%, lower than the 16.5% in 2022 and 16.6% in 2021. The average retailer faces $145 million in merchandise returns for every $1 billion in sales. Online sales have a higher return rate; 17.6% of merchandise purchased online is returned compared to 10% for pure brick-and-mortar returns. Over 15% of holiday gifts are expected to be returned, totaling some $148 billion. Fraudulent returns account for 16.5% of total holiday returns. Types of return fraud in 2023 included returns of used, non-defective merchandise (49%), the return of shoplifted or stolen goods (44%), returns of goods purchased on fraudulent or stolen tender (37%), and return fraud from organized retail crime organizations (20%).
- Electronic shopping retailers will have to monitor minimum wage changes, as 22 states increased their minimum wages in January 2024, according to USA Today. About half of the increases are automatic adjustments linked to inflation. States that raised their minimum wages in January 2024 include Hawaii ($14), Maryland ($15), Nebraska ($12), and Washington ($16.28). Several states are set to boost their minimum wage levels later this year, including Florida (up to $13 in September) and Nevada (up to $12 in July). According to the Economic Policy Institute, nearly 40 US cities and counties will increase their minimum wage rates above state levels at the start of the new year. The federal minimum wage is $7.25 an hour, and more than 20 states, primarily located in the South and the Midwest, use the federal minimum as their wage floor.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.