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E-commerce growth likely will slow as consumers return to pre-COVID-19 behaviors

June 16, 2021

Online sales have grown consistently throughout COVID-19, but the rate of growth likely will diminish as consumers return to pre-pandemic behaviors, according to ICSC’s new report on first-quarter e-commerce, which is based on U.S. Census Bureau data.

E-commerce sales in the U.S. grew by 39 percent year over year in the first quarter, but the pace of growth is more moderate than at its peak, in the second quarter of 2020, when e-commerce sales surged 43.7 percent year over year.

The biggest increases in online sales during the first quarter were among food-and-beverage retailers, up by 106.5; building materials retailers, up by 63.1 percent; healthcare and personal care retailers, up by 53.8 percent; and sporting goods retailers, up by 48.8 percent. For those categories, however, the pace of growth is decelerating compared to the massive growth they experienced at the pandemic’s peak, in the second quarter of 2020. Meanwhile, general merchandise retailers posted a significant gain of 62.4 percent and clothing retailers a solid 33.2 percent.

Retailers’ earnings bear out the growth of online sales over a longer stretch. For Gap Inc., for example, online sales climbed 82 percent from the first quarter of 2019 to the first quarter of 2021. They accounted for 40 percent of the company’s total sales for the first quarter of 2021, compared with 25 percent for the first quarter of 2019. Meanwhile, online business more than doubled for American Eagle Outfitters’ Aerie lingerie brand, which posted online sales growth of 158 percent from the first quarter of 2019 to the first quarter of 2020. Macy’s Inc.’s first-quarter digital sales of $1.7 billion outperformed the company’s expectations, accounting for 37 percent of total sales, up from 24 percent in the first quarter 2019.

Read the full Q1-2021 E-Commerce Outcome report here.

RELATED: ICSC’s Q4-2020 E-Commerce Outcome report

By Brannon Boswell

Executive Editor, Commerce + Communities Today

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