Insider Intelligence predicts that US ecommerce marketplaces would generate revenues of $384 billion in 2023 – a YoY growth of 10.2%. Here’s what’s driving the double-digit growth.
The overall ecommerce sales comprise direct sales where the company acts as a seller on the platform and the marketplace model where multiple sellers sell their products on the platform.
Amazon, which is the largest online seller in the US, has gradually moved to the marketplace model and Insider Intelligence estimates that marketplace would account for almost two-thirds of its US ecommerce sales this year – as compared to 58.3% in 2019.
“Amazon has really written the playbook for operating a successful marketplace in the US,” said Insider Intelligence analyst Sky Canaves.
The company expects Amazon’s US marketplace to generate revenues of $277.91 billion this year – which is over 72% of the total market.
In the first quarter of 2023, Amazon’s total sales increased by 9% while the sales of its North American segment rose by 11% to $76.9 billion.
The company was witnessing strong double-digit growth until about a few quarters back but the growth rates have since subsided.
In 2022, Amazon’s total sales rose just above 9% which was the lowest ever. Along with the slowing growth in its ecommerce business, Amazon is also battling a slowdown in its lucrative cloud business whose revenue growth fell to an all-time low of 16% in the first quarter.
Coming back to the ecommerce marketplace, eBay is a distant second with a projected market share of around 9% in 2023.
US Ecommerce Marketplace Sales to Rise Over 10% in 2023
Insider Intelligence expects eBay to report sales of $35.41 billion in 2023. The company which operates entirely as a marketplace has been losing market share in the US and its 2023 projected revenues are $4 billion lower than what they were two years back.
Walmart meanwhile has been growing its ecommerce business – including the marketplace. Insider Intelligence expects Walmart’s marketplace revenues to rise 12.6% to $8.57 billion.
In 2022, the marketplace accounted for 10.2% of Walmart’s total ecommerce sales. Over the last few years, Walmart has invested heavily in its ecommerce ecosystem.
Walmart to acquire 75% of Flipkart for $15b, with Alphabet co-investing &3b, to tackle the Indian ecommerce market.
— Dana Labin (@danahorska) May 7, 2018
The retail giant’s online sales have grown quite fast and it now has multiple ecommerce sites in 20 countries. It also acquired Indian ecommerce startup Flipkart and sees it as a key growth driver.
However, when it comes to the US ecommerce marketplace, Walmart accounts for a mere 2.2% of the total market.
US Ecommerce Sales Expected to Surpass $1 Trillion in 2024
Statista expects total US ecommerce sales to surpass $1 trillion in 2024 and further rise to $1.45 trillion by 2027.
In Q1 2023, total US ecommerce sales rose 8% to $253.1 billion. Ecommerce sales spiked during the COVID-19 lockdowns as most people preferred to shop online.
However, the growth rates have since fallen and in Q1 2023, ecommerce sales accounted for 15.1% of total sales. Ecommerce penetration levels spiked during the COVID-19 pandemic but have since been more or less stagnant.
Looking at the global scenario, Insider Intelligence expects ecommerce to account for 20.8% of total retail sales in 2023 – and expects the penetration level to rise to 24% by 2026 and reach $8.1 trillion.
AI Might Give a Boost to Online Sales
Businesses globally are trying to integrate AI into their products and services. Amazon is reportedly looking to integrate a ChatGPT-like chatbot into its ecommerce platform.
As AI models make technological advancements, they would help spur ecommerce sales. The nascent technology might disrupt several industries.
AI stocks have seen upwards price action this year and C3.ai – which is among the rare pure-play listed AI stock – has more than tripled.
Nvidia too joined the $1 trillion market cap club as sales of AI chips have boosted its revenues.
Social media shopping is another fast-growing area. Forbes estimates that in 2020, social ecommerce sales were $992 million and expects it to rise to $2.9 trillion by 2026 – a CAGR of almost 20%.
Forbes estimates that 96.9 million people in the US shop on social media platforms like Facebook and TikTok and expects the number to rise to 114.3 million.
Facebook is the most popular platform for social media shopping and around half of the users shopped on the platform. Instagram is a close second with 47.4% while YouTube comes third with 33.9%.
Twitter is the sixth most popular platform among buyers shopping on social media and 18.5% of the users shopped on the platform.
Related Stock News and Analysis
What's the Best Crypto to Buy Now?
- B2C Listed the Top Rated Cryptocurrencies for 2023
- Get Early Access to Presales & Private Sales
- KYC Verified & Audited, Public Teams
- Most Voted for Tokens on CoinSniper
- Upcoming Listings on Exchanges, NFT Drops