The growth of e-commerce: by 2027, 41% of retail sales will pass online
It was the pandemic that made online sales become a common habit. Of course, thee-commerce was already massively present in society, especially among the youngest, but the real surge occurred from 2020 onwards, when purchasing online entered the habits of the older generations (those born in the 1950s and the ’70s). And, if 2022 represented a temporary slowdown in the growth of e-commerce, the latter will take on an increasingly important role in the future.
About that, Boston Consulting Group (BCG) carried out a study (“The winning formulas for the growth of e-commerce”) to investigate the changes in online sales in the post-pandemic period. 410 retail companies and 415 retail and consumer goods (CPG) companies worldwide were involved, with revenues ranging from $50 million to more than $10 billion.
According to Bcg analysis, by 2027, 41% of retail sales will take place online. In 2018 it was only 18%. Growth that does not stop, therefore: in 2022 e-commerce sales increased by 3% in Europe and 7% in Asia and the United States, and it is estimated that the compound annual growth rate will be 9% until 2027. The Italian detail is illustrative: in our country the growth was 77% during Covid, it fell to 22% in the immediately following period and in 2023 it settled at 9%.
The change in purchasing habits is also noticeable in the approach to online offer periods, such as Black Friday and the Cyber Monday. In 2023, 74% of consumers (especially US, Swiss and German) will want to take advantage of these opportunities, with a growth of 7% compared to the previous year. On the other hand, half of those interviewed have reduced non-essential purchases and spend more time comparing the prices of goods, with 41% saying they buy more based on offers and promotions.
“Will e-commerce continue to grow even after the pandemic? I think it’s one of the questions I’ve heard most frequently in recent times,” he explained Antonio Faraldi, managing director and partner of Bcg and co-author of the study. “The answer is yes: it will continue to grow, albeit at a less frenetic pace. We are talking about +9% per year between now and 2027. Which is not the 14% of pre-Covid but is still more than double the 4% at which sales in physical channels are expected to grow. The other aspect that we were interested in exploring further is how to win in this sector. We asked this directly to over 800 professionals and the picture that emerges, and which we have included in the report, is very interesting.”
The study analyzed Cpg companies based on six indicators to detect their level of maturity with respect to online commerce: digital investments, number of e-commerce initiatives, technological maturity, organizational structure and team agility. The result was positive for around half of the companies, i.e. those with post-Covid growth above 30% and a good growth forecast. Conversely, a similar percentage of companies, i.e. those with post-Covid growth of 10% or less and little confidence in their future, received a negative rating.
In the online sales sector, the strategy used is also very important. Not all companies are at the forefront in this sense, but there is a large margin for improvement to be achieved by following three guidelines, as identified by Bcg: more mature technology stacks, an organizational structure that supports e-commerce and greater agility .
