The mantra of 2022 should really be: nobody knows anything.
It is amazing how little we understand about how the pandemic has changed our lives and our country. It’s unclear whether or not the US economy is on the upswing, or whether big cities like New York will be scarred forever. We’re not sure if women’s careers have been permanently affected or if our mental health will be okay.
The future of our online shopping habits is another unknown.
The government recently revealed that the US e-commerce boom during the pandemic was even greater than previously believed. But in 2021, that trend started to reverse a bit. Physical stores outperformed e-commerce last year and continue to do so this year. The trajectory of Internet shopping has changed from bananas to confused bananas.
Now corporate executives, retail analysts, and economists are trying to figure out how fast we could move toward a future where online shopping is the primary way to shop. Will internet shopping return to something like the fairly constant growth rate of the decade before 2020? Or has the pandemic permanently accelerated our eCommerce lives?
Don’t wait long for a definitive answer, but the next few weeks of leads from Amazon, Walmart, and government sales data should give us a better idea.
This is not just a nerdy debate. Our collective buying behavior influences trillion-dollar companies, millions of retail jobs, and the health of the American economy. Uncertainty about the direction of online shopping is one of the biggest questions facing the tech industry and financial markets right now.
8 signs the economy is running out of steam
Worrying outlook. Amid stubbornly high inflation, rising consumer prices and declining spending, the US economy is showing clear signs of slowing, fueling concerns about a possible recession. Here are eight other measures that signal trouble ahead:
I will try to present the shopping situation as clearly as I can.
For most of the decade leading up to 2020, Americans increasingly shopped online at a predictable rate. E-commerce sales increased 10 to 15 percent a year, according to the Census Bureau. datataking a little more each year from the money Americans spend at stores.
Then internet shopping became hyperactive, with our online shopping increasing by at least 50 percent in the first few months after the virus began to spread in the US, according to a recently reviewed study. government figures
But then last year, brick-and-mortar shopping accelerated, and online shopping has since lost ground. For many people, it’s a relief to walk the aisles of stores again. High inflation may also be pushing people to spend more of their budgets on essential items that we still overwhelmingly buy in stores.
Other signs point to a similar picture of meh growth for internet purchases, including data from Mastercard SpendingPulse, which tracks US purchases, which He showed E-commerce sales were up just 1.1 percent in June from the same month in 2021. In-store purchases were up nearly 12 percent.
None of this is a shock. Of course, we weren’t going to be shopping online like it was spring 2020. And today’s online shopping likely accounts for a much larger share of Americans’ spending than it would have if the pandemic had never happened.
The open question is what happens now. Will we return to the relatively slow and steady online shopping growth of 2019? Or will the hermit habits learned in the early phase of the pandemic continue to influence our purchases, making this growth even faster? Or maybe even slower?
All of this is a huge headache for anyone who sells stuff, but it’s also important to us. Amazon has said that overestimate how long the online shopping craze would last and that he was spending too much on new stores and other things. The company is pulling out, which affects the jobs of the people and the communities where Amazon is pulling out.
And, I’m sorry to mention this, but a golden age for online shoppers could be at risk. Hangovers from the pandemic and other changes have more difficult and expensive for businesses that sell things online to buy, ship, store, and advertise their products. If online shopping has a less rosy couple of years, merchants large and small may want to reconsider how much money they’re spending on the e-commerce features we enjoy, like free shipping and in-store order pickup.
Understand inflation and how it affects you
If you thought the past few years were dicey in shopping and beyond, it might be even more so.