By Netta Kivilis, Head of Marketing, Custora
For U.S. retail overall (offline + online), 2014 started with a slight decline: U.S. retail sales declined 0.4% in January 2014 compared to last year, according to the U.S. Department of Commerce. However, there was a bright spot in the lukewarm retail environment: E-Commerce sales grew a healthy 8% in January over last year. This is based on The Custora Pulse’s latest U.S. E-Commerce data, tracking e-Commerce transactions from over 100 U.S. retailers and 70 million shoppers.
All key e-Commerce indicators exhibited substantial growth in January ‘14 compared to January ‘13: Traffic to e-Commerce stores was up 6%, and the average conversion rate grew to 2.2% (from 2.1% in January ’13). These factors combined resulted in a strong 7% growth in online orders.
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Moreover, e-Commerce Average Order Value, or AOV, was up as well in January: It grew 1.3% over January 2013. This indicates that the e-Commerce environment remained stable and did not become more promotional and discount-driven compared to last year.
Growth Continues Positive Holiday Trends
January’s growth comes on the heels of a strong e-Commerce holiday season, with 12% growth in online sales for the entire season (November – December ’13). Key holidays dates exhibited even higher growth: Black Friday was up 16% over Black Friday ’12, and Cyber Monday was up 18%. To see more U.S. e-Commerce holiday stats and trends, see our Holiday 2013 E-Commerce Recap.
Mobile Shopping Continues To Shine
Mobile shopping continues its unabated growth, driving one third of online transactions in January 2014, compared to 28% in January 2013.
Android devices took U.S. by surprise, accounting for 20% of mobile orders (up from only 14% in January last year).
Marketing Channels: Free Channels Grow In Importance
Email marketing and organic search grew their share of online transactions from a combined 38% in January 2013 to a combined 45% in January 2014. This came at the expense of Affiliate Marketing and Display Advertising: Affiliate Marketing drove 12% of all transactions in January 2013, but only 8% in January 2014.
This is potentially good news to marketers, as it might imply lower spend on paid marketing channels. However, this premise only applies to marketers with enough savvy and dedication to invest in organic search and email marketing.
Social media is still struggling to hit its stride as a channel directly driving e-Commerce transactions, with only 2% of all transactions in January being attributed to social media.
The Big Picture
The share of U.S. online sales out of all retail sales has grown from less than 1% in 2000 to 5.9% in Q3 2013, according to the U.S. Department of Commerce. If physical retail continues to decline, while online retail continues growing at close to double-digit rates, it will be interesting to see how much market share online stores “steal” from brick and mortar in 2014. The Custora Pulse will keep tracking e-Commerce trends throughout the year, you can sign-up here to receive monthly email updates and holidays reports on U.S. e-Commerce performance.
Netta Kivilis is Head of Marketing at Custora, which provides a customer-centric marketing platform for e-Commerce retailers. Prior to Custora, Kivilis worked for Amazon.com in marketing and product management roles, and was a software developer in an enterprise software startup. She holds an MBA from Harvard Business School and a BSc in Computer Science and Humanities from Tel Aviv University.
