The boom times for ecommerce and retail have largely passed. “It’s going to be harder [for retailers] to identify pockets of growth and opportunity. But, the good news is that it’s not going to be that roller coaster of demand fluctuations that has been challenging for retailers to navigate over the last couple of years,” our analyst Blake Droesch said.
US retail sales will reach $7.41 trillion this year, per EMARKETER’s forecast. As the economy stabilizes and consumers adjust to inflation, the US retail market is projected to grow at an annual rate of 3.1% through 2028, per our forecast.
Despite modest overall growth, retailers can find opportunities in specific product categories, sales channels, and international markets.
Discretionary categories, particularly computer and consumer electronics and toys and hobbies, will be the fastest-growing sectors through 2028, per EMARKETER’s forecast. As inflation stabilizes, consumers will likely redirect their spending toward these non-essential items.
In 2024, food and beverage and health and personal care surpassed $100 million in ecommerce sales, with food and beverage reaching $105.31 billion and health and personal care totaling $149.21 billion.
“The only thing that is really separating ecommerce from the rest of retail at this point is that there are a couple of categories—mainly food and beverage and health and personal care—that are still growing, and still have room to grow,” Droesch said.
These categories will remain strong as consumers keep buying online.
Amazon dominates the US ecommerce market with 40.9%, but opportunities exist in less saturated categories—like health, personal care, and beauty—where smaller retailers can compete. Ecommerce is projected to account for 20.0% of total retail sales by 2028, driven by increased online purchasing of essentials.
Direct-to-consumer models, online marketplaces like Amazon, and traditional, wholesale retail offer opportunities. To compete, retailers should evaluate where they can best position their products, particularly in categories where Amazon is less dominant.
While Southeast Asia shows potential, Mexico is a top contender for US-based retailers to expand online, Droesch said. In 2024, Mexico’s ecommerce sector grew by 15.7%, with sales reaching $58.89 billion, per our forecast. “Mexico sits in a sweet spot where it’s a large market, relatively mature, but there’s still more dollars coming into ecommerce than in many countries in Western Europe and the US,” Droesch said. To compare, Mexico’s ecommerce market is currently larger than the ecommerce markets of Spain, France, the UK, Germany, and Italy.
Learn more in our Retail and Ecommerce Sales Benchmarks: Q4 2024.
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