Retail Sales Growth Will Slow in 2022

General Market Currents

After two turbulent years, retail sales growth will slow in 2022 before returning to pre-pandemic levels next year. Ecommerce sales growth will fall below 10% this year, its lowest rate since 2009. In-store spending will see stronger-than-typical growth for another year as consumers continue returning to physical locations. Despite the slowdown, eCommerce sales will hit $1 trillion for the first time in the US.

Catch the Next Big Swells in DTC eCommerce

What areas and opportunities in DTC eComm are ripe for innovation over the next few years?

  • Personal care and homegoods will reach 40% eCommerce penetration within the next decade. Currently at 16.5% eCommerce penetration this year, analyst Blake Droesch predicts this climb, which he says will be driven by convenience and faster delivery speeds. The items being purchased in grocery stores and pharmacies (think deodorant, shampoo, and toothpaste) have huge potential to move online.

  • Changing returns from a problem into a solution. Returns are a major reason for cart abandonment in apparel. It’s like an “arts and crafts project,” analyst Andrew Lipsman says of the return process, but streamlining it would help convert online browsers into online buyers and create a significant competitive advantage for brands.

Inflation Headwinds Into Peak Season and What to Expect

Inflation is expected to change holiday shopping behaviors as consumers look for ways to score deals and minimize expenses.

  • Many shoppers plan to cut back, switch to value brands, and shop even earlier in the season to avoid price hikes.

  • At the same time, consumers are enthusiastic about celebrating the holidays after two years of limited or pared-back gatherings.

  • Shoppers are feeling the pinch: More than half (51%) of consumers plan to buy fewer holiday gifts this year, per a Salesforce report.

  • Over one-third (38%) of US adults expect to spend less this holiday season, per a Digital River survey conducted by Opinium. Roughly two-thirds (67%) say they’ve already reduced spending on non-essential items.

Many shoppers are already struggling with elevated back-to-school costs, which could eat into budgets for the rest of the year and cause households to scale down holiday celebrations.

Carrier Update with Shawn Compton, VP of Fulfillment Logistics at OceanX

In this week's Carrier Update, Shawn highlights the following:

  • Railroad strike status
  • Potential protests on West Coast Ports
  • OSM Worldwide celebrates 20 years in business

Click here to watch the video.