YoY Retail E-Commerce Spending Seizes Negative Growth

US retail e-commerce spending in Q1-2009 recovered from 3 percent negative growth YoY when compared to Q4-2008. According to ComScore, retail e-commerce sales remained flat when compared to Q1-2008, as they recovered slightly from the immediate previous quarter. Sports & Fitness is the fastest growing category online followed by Books & Magazine in dollar sales.

Historic Trends
If the data provided by ComScore is observed, year 2007 had better growth rates YoY, when compared to 2008. This is mainly due to the positive environment in the economy and high consumer confidence. Q2 and Q3 maintained the highest growth rates till now (Q1-2009) with 23 percent each YoY. It can be observed that Q4, which is crucial for the businesses for the entire year, didn’t had the highest YoY growth rate when compared to Q3.

The YoY growth rates declined 2008 when compared to 2007. Q2 has the better rate with 13 percent, while Q1 and Q3 followed with 11 percent and 6 percent respectively. And Q4 posted a negative growth rate of 3 percent. It is the only quarter with a negative rate in all the nine quarters mentioned in the report.

Fastest Growing Product Categories
In Q4 2009, Sports & Fitness is the fastest growing category with 23 percent of growth in dollar sales indicating consumer willingness to purchase fitness equipment such as treadmills and stationary bikes. People bought more books & magazines with 19 percent after Sports & Fitness equipment. Video games, consoles & accessories and Computer Software excluding PC games had 12 percent share each.

Online retailers are optimistic on how the rest of the year will fare as the online sales decline remained only in Q4-2008 and the market is quickly recovered from a negative growth. It is expected that the market with show some signs of recovery in the second half of the year 2009.

In another report from US Department of Commerce, Q1-2009 total retail sales were down by 8.8 percent YoY, which paints a grim picture. When compare to this, online retail sales preformed far better as people turned to online to buy necessary products cheaper than brick and mortar stores.

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