Cambridge, MA–Online retail in both the United States and Western Europe will continue on a double-digit growth trajectory over the next five years, according to two new forecasts released this week by Forrester Research, Inc.
Both U.S. and European online retail will grow at a 10% compound annual growth rate (CAGR) from 2010 to 2015, reaching $279 billion (134 billion euros) in 2015. The forecasts include business-to-consumer sales excluding travel and financial services. The European forecast encompasses 17 Western European nations and includes a category-by-category breakdown of online retail across these markets.
Sales Strong Despite Slow Economic Recovery
“The online retail market in both the U.S. and Western Europe remains strong, despite the challenging economy,” said Patti Freeman Evans, vice president and research director at Forrester.
“In fact, with consumer purchasing behavior returning to normal, U.S. web sales in 2010 actually accelerated over 2009 compared with the prior year, growing 12.6%. In Europe, very strong growth in 2010 was fueled by new online buyers and higher spend per capita on the demand side, as well as the launch of transactional websites by established offline players,” Evans said.
Retailers are supporting consumers’ increasing use of Internet, helping to drive growth with new business models, such as flash sales and group buying, as well as improved merchandising to provide a broad selection of products available online. However, this growth comes at the expense of brick-and-mortar stores, as consumers increasingly spend on the web, especially during critical shopping days such as Cyber Monday.
In Western Europe, the online retail market grew 18% from 2009 to 2010 and is projected to grow 13% from 2010 to 2011, but growth rates will then slow as the market matures and buyer penetration begins to level off. By 2015, 68% of online adults will have made a purchase online; however, northern European countries will see 80% or more of their online population buying on the web, versus less than 50% in southern countries.
The top-line forecasts are available to Forrester RoleView clients; subscribers to Forrester’s ForecastView receive more-detailed forecast data.
About Forrester Research
Forrester Research, Inc. (Nasdaq: FORR) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, customer insight, consulting, events, and peer-to-peer executive programs.