E-commerce refers to the activity of buying or selling goods and services in an electronic manner. E-Commerce came into prominence with the launch of the World Wide Web in the mid-1990s with the likes of Amazon, Alibaba, E bay as the pioneers in the sector.
At present, there are various models of E-commerce. The penetration of the internet is very closely linked with the spur of e-commerce markets globally and for this reason, in the background, it is anticipated that the boom in e-commerce is expected to sustain and grow.
In today’s digital world, it is hardly possible for any firm or Business to grow without an effective online presence and all businesses big or small, traditional or modern is trying to sell their products and service online. In this blog, we will look at retail e-commerce sales data and projected numbers for 2022 and 2023 along with past data of 2020 and 2021 we will compare the numbers and will see how much share does e-commerce holds as a percentage of total retail sales worldwide and then finally we will see at the anticipated numbers for the United States and at the last we will look at the revenue growth for e-commerce in India in past few years and future as it is touted as one of the most promising markets globally.
Retail e-commerce sales worldwide
The total volume of sales through e-commerce is on a phenomenal rise and the years 2020 and 2021 saw a rise never before. The major reason for this growth is accepted globally and it is named the outbreak of the Pandemic. Though there are some structural reasons as to why the sales for E-commerce is increasing, yes the fact cannot be discounted that the Covid pandemic gave an impetus to the sector.
In 2020, Retail e-commerce sales worldwide were about 4290 billion USD and in the year 2021, they rose to 4903 billion USD. It saw a rise like never before as we discussed as the growth in percentage terms was 14% thanks to Pandemic as people stayed at their homes and with markets close, the e-commerce sector was bound to increase. But as per our projections, the momentum is bound to be held and the numbers are very promising for the years 2022 and 2023.
In 2022, we expect Retail e-commerce sales to climb to 5501 billion USD and it is a 12% rise over 2021 figures.
By 2023, we anticipate that retail e-commerce sales data will reach 5978 billion USD and it is about an 8% rise over 2022 data.
Just in a matter of 4 years, Retail e-commerce sales are expected to peak by 40% from the base year of 2020. In 2020, as we saw above the Retail e-commerce sales worldwide was 4290 billion USD and in 2024 the same figure is expected to climb to 5978 billion USD.
So if you are an investor or planning to start a business then getting your business online and operating through e-commerce is very essential as the numbers indicate that the market is on an upward swing.
E-commerce share of total global retail sales
Before getting into the numbers, let’s first discuss what this data signifies. This data tells us the impact of e-commerce on overall retail sales. For every 100 rupees of retail sales, what share of retail sales happens through e-commerce platforms. The fraction of sales through e-commerce is projected to rise and the major reason is the breakthrough of the internet in developing and emerging markets and it has directly led to increasing in the share of e-commerce retail sales of the total share.
In the year 2020, the E-commerce share of total global retail sales was 18.3%, which signifies that every 18 rupees out of 100 rupees earned in retail sales were through e-commerce platforms.
In 2021, the E-commerce share of total global retail sales rose to 19.8 and in absolute terms showed an increase of 1.5%.
For the years 2022 and 2023 also the growth is expected to rise.
For 2022, we project that it will rise to 20.7% and for 2023 it can increase to 21.4%. So in effect, the market share of e-commerce in retail sales which was 18.3% in 2020 will rise to about 21.4% in 2023, a surge of 3.1% in just 4 years. The 3.1% is a huge figure because the absolute numbers as we saw in the above paragraph, is huge.
This signifies the uptick s happening in both ways, not only the absolute sales figure of retail e-commerce is set to rise but all the share of retail e-commerce as a percentage of total retail sales is about to see an uptick. And the twin rise is a phenomenal achievement for the overall e-commerce market.
Retail e-commerce revenue in the United States
Now let’s turn our focus to the United States of America, the first country where e-commerce came on a large scale and became profitable. The share of revenue and the projected growth in the United States is expected to be very promising and the focus is also gradually shifting to developing and emerging markets but still the data for the US holds importance because in general the trends in developed markets get reflected in developing markets over some time.
In 2020, Retail e-commerce sales in the US was about 645 billion USD and in the year 2021, they rose to 769 billion USD. It saw a stupendous growth in percentage terms was 19% and interestingly the worldwide growth percentage for the same period was 14%, so this showed that the e-commerce market is still growing faster in the United States than worldwide. As per our projections for the US, it is bound to increase in more or less the same manner as it happened in the past 2 years.
In 2022, we expect the Retail e-commerce sales in the US to climb to 877 billion USD and it is a 14% rise over 2021 figures.
By 2023, we anticipate that retail e-commerce sales data in the US will reach 1003 billion USD and it is about a 14% rise over 2022 data.
Just in a matter of 4 years, Retail e-commerce sales in the United States is expected to peak by 55% from the base year of 2020. In 2020, as we saw above the Retail e-commerce sales in the US was 645 billion USD and in 2024 the same figure is expected to climb to 1003 billion USD.
Retail e-commerce sales CAGR forecast
Apart from the analysis which we saw in this Blog, one more critical piece of data is important if you are an investor or in general trying to expand your e-commerce presence all over the world. You will surely be interested in which countries Compound annual growth rate is highest. This number signifies which countries e-commerce market is expanding at the fastest pace.
The CAGR is highest in Turkey, then followed by Argentina, Indonesia, South Africa, India, Brazil and China. So 4 of the 5 countries in BRICS is expected to see the fastest growth in e-commerce expansion and also the East Asian tiger economies is set to show a great increase.
In China, CAGR is expected to be around 6.85% and for Turkey, it is about 15%. But India holds one of the most promising and exciting results and the CAGR is expected to rise by about 10% in India and with a huge market and population and the encouraging CAGR figure, if you are an investor then these data surely point out that you will be in a better position to invest and expand in BRICS economies in general and India, South Africa in particular.
