This article was contributed by Steven Blake who is a freelance writer covering shopping, consumer, and retailer behavioral analysis for various clients in the retail industry.
While there is still a sizable percentage of people who prefer the tactile availability of brick-and-mortar stores, online sales have grown at an astonishing pace since COVID-19. The number of online shoppers in the U.S. has increased by 30%, and many consumer goods are being sold digitally.
The U.S. Census Bureau announced Quarterly Retail E-commerce Sales on February 17 this year. Total e-commerce sales in 2022 are estimated at $1,034.1 billion, an increase of 7.7% (±0.4%) from 2021. Total retail sales in 2022 are 8.1% (±0.9%) higher than in 2021. E-commerce sales accounted for 14.6% of total sales in 2022.
The Statista Digital Market Outlook forecasts that by 2027, online shopping revenue in the U.S. will exceed 1.7 trillion dollars. The revenue figures include purchases via mobile devices such as desktop computers, smartphones and tablets, such as online shopping on Amazon.
The transportation industry, which has a lot to do with online sales, has also changed. The data from the Bureau of Transportation Statistics showed that $140.3 billion of transborder freight moved by all modes of transportation in August 2022, up 24.1% compared to August 2021. Trucking freight, which has the strongest correlation with online shopping, up 15.9% compared to August 2021.
The Transportation Statistics Annual Report 2022 released by the Bureau of Transportation Statistics believed that increasing the proportion of e-commerce sales in retail sales will shorten the transportation distances and bring greater challenges to alleviating traffic. This can change the trucking business, as more and more trucks will be deployed for shorter hauls and last-mile deliveries.
Most studies have shown that free shipping greatly impacts online shopping behavior. Jungle Scout released Q2 2021 Consumer Report, a quarterly study of 1,000 U.S. consumers revealing that 80% of consumers want free shipping when ordering a certain dollar amount of products, and 66% want free shipping on all online goods.
At the beginning of 2023, the US coupon website CouponBirds conducted a survey of 1,000 American consumers to understand how free shipping affects their holiday shopping decisions. 71% of consumers cite free shipping as the most important factor for repurchases in the same store when shopping online.
82% of consumers think whether a store offers free shipping will affect their shopping preferences, while only 12% believe that free shipping will not affect their thinking. Among the consumers who focus on free shipping, 29% think it is the most important decisive factor; 46% believe that among two products with similar prices, they will prioritize the product with free shipping. However, retailers faced rising shipping costs in 2022 and had to adjust their free shipping policies. CouponBirds surveyed the retailers it works with and found that the total number of retailers offering free shipping for any purchase decreased 7.5% from 2021 to 2022.
Freight costs are expected to decline in 2023 as oil prices decline in the second half of 2022. Many retailers have realized that free shipping is vital to their online sales. In 2023, more retailers will provide free shipping more easily, but this change may take a long time.
About the author
Steven Blake is a freelance writer covering shopping, consumer, and retailer behavioral analysis for various clients in the retail industry. Steven strives to make the topic of saving money approachable for all. He is well-versed in money-saving tips and how to live fabulously within a budget. He has much experience researching and exploring the latest shopping trends and developing retail marketing strategies.