2011 Forecast: Sunny, With a Chance of Recovery
Posted:
Wednesday, January 26, 2011
For most e-retailers, the 2010 holiday season was a welcome beam of sunshine after quite a few cloudy months. Our Holiday Shopping Recap showed more than 15% growth in online retail, a positive sign of both economic improvement and consumer confidence
Yet, the question remains: is the improvement here to stay? Is this forecast reliable?
Taking a look at three major categories - US Economic Growth, Consumer Spending, and E-Commerce Penetration - the signs are positive.
On January 14th, the Wall Street Journal reported that major bank economists had raised their 2011 U.S. Gross Domestic Product (GDP) outlook from 3% to 3.3%. This adjustment echoed Fed Chairman Ben Bernanke’s forecast the day prior that recovery was on pace and GDP growth would likely pace between 3% and 4% for the year.
To compliment optimism about macro-economic growth, other industry sources are indicating that the holiday sales spike was the first step in a return of consumer spending habits. The American Express Spending & Saving Tracker data for January indicates that more than 54% of adult American consumers plan to spend the same or more than they did in 2010. The report cited improved consumer saving & financial flexibility as a a major catalyst for a rise in purchases, with “health & fitness” and “clothing” as two of the top three projected spending categories.
Finally, e-commerce sales are poised for accelerated post-2010 growth as a major part of the economic improvement expected for 2011. A JP Morgan study released earlier this month calls for double-digit growth - see below - in the e-commerce market from 2010 to 2013. In addition, consumers continue to buy online with more frequency, with nearly 90% of the population using the web at some point to purchase.
As the 2011 economic forecast calls for optimism, it will be increasingly important for retailers and e-commerce businesses to continue to meet consumer needs online. For December, comScore indicated that aggregate search volume across the major U.S. search engines was up more than 12% from the year prior.
All of the indicators are aligned, pointing to a far better atmosphere than what most retailers have experienced for many months. With a brighter forecast on the horizon, it’s time to enjoy the “weather” and make your presence known to the world around.
Posted by Jon Sadow, Google Retail Team
Yet, the question remains: is the improvement here to stay? Is this forecast reliable?
Taking a look at three major categories - US Economic Growth, Consumer Spending, and E-Commerce Penetration - the signs are positive.
On January 14th, the Wall Street Journal reported that major bank economists had raised their 2011 U.S. Gross Domestic Product (GDP) outlook from 3% to 3.3%. This adjustment echoed Fed Chairman Ben Bernanke’s forecast the day prior that recovery was on pace and GDP growth would likely pace between 3% and 4% for the year.
To compliment optimism about macro-economic growth, other industry sources are indicating that the holiday sales spike was the first step in a return of consumer spending habits. The American Express Spending & Saving Tracker data for January indicates that more than 54% of adult American consumers plan to spend the same or more than they did in 2010. The report cited improved consumer saving & financial flexibility as a a major catalyst for a rise in purchases, with “health & fitness” and “clothing” as two of the top three projected spending categories.
Finally, e-commerce sales are poised for accelerated post-2010 growth as a major part of the economic improvement expected for 2011. A JP Morgan study released earlier this month calls for double-digit growth - see below - in the e-commerce market from 2010 to 2013. In addition, consumers continue to buy online with more frequency, with nearly 90% of the population using the web at some point to purchase.
As the 2011 economic forecast calls for optimism, it will be increasingly important for retailers and e-commerce businesses to continue to meet consumer needs online. For December, comScore indicated that aggregate search volume across the major U.S. search engines was up more than 12% from the year prior.
All of the indicators are aligned, pointing to a far better atmosphere than what most retailers have experienced for many months. With a brighter forecast on the horizon, it’s time to enjoy the “weather” and make your presence known to the world around.
Posted by Jon Sadow, Google Retail Team
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