FTI Consulting Projects U.S. Online Retail Sales to Approach $440 Billion in 2017
November 01 2016 - 7:30AM
FTI Consulting, Inc. (NYSE:FCN) today released its U.S. Online
Retail Forecast: Omni-Channel Retailing Challenged by Its Success,
which projects U.S. online retail sales will approach $440 billion
in 2017, compared to an expected $395 billion in 2016.
Online retail sales growth has accelerated slightly in the past
year to just over 14 percent, and FTI Consulting’s forecast expects
online retail sales growth will moderate to 11.4 percent next year,
compared to approximately 2 percent to 3 percent for store-based
sales. However, online-only retailers, predominantly Amazon.com,
Inc., are taking an increasing share of total online sales despite
the success to date of many omni-channel retailers — those with a
combination of traditional retail stores, online stores or other
shopping channels, according to research from FTI Consulting’s
Retail & Consumer Products practice.
“For each marginal sales dollar that migrates away from stores
to the online channel today, only about $0.68 stays within the
traditional retail ecosystem,” said Christa Hart, a Senior Managing
Director in the Retail & Consumer Products practice within the
Corporate Finance & Restructuring segment at FTI Consulting.
“Online sales by omni-channel retailers are growing robustly but
aren’t accelerating enough to match Amazon’s torrid sales growth.
There is little reason to believe this trend will reverse, despite
the efforts of traditional retailers.”
FTI Consulting projects online retail sales will reach $562
billion by 2020, with online market share reaching 21 percent,
excluding the low penetration category of grocery. This growth
trajectory will result in a near-doubling of online market share by
2026.
In contrast to early mover, high-penetration product categories,
such as books and music, the majority of online sales dollars today
comes from medium-penetration categories, such as apparel and
accessories, consumer electronics, home furnishings, sporting
goods, and toy and hobby, all of which have online market shares in
the mid-teens to low 20 percent range, according to FTI
Consulting’s estimates.
“Consumers’ shopping patterns have evolved, and it’s not just
during ‘event days’ such as Cyber Monday. Most shoppers are
completely comfortable purchasing goods online every day from any
of several personal devices,” Ms. Hart said. “We expect that the
migration to the online channel will continue over the next decade,
particularly given the findings in our recent article on
omni-channel and customer preferences, ‘Online, Offline or Both,
Shoppers Call the Shots 24/7,’ that 90 percent of our survey
respondents had made an online purchase in the past three
months.”
About the U.S. Online Retail ForecastFTI
Consulting’s U.S. Online Retail Forecast model is derived from
imposing the best-fitting logistic curve on historical online sales
data by product category. The U.S. Census Bureau has published
online retail sales estimates in about a dozen product categories
since 1999. From these time series data sets, FTI Consulting
estimated online market shares for these categories since inception
and then derived an appropriate logistic growth equation for each
market share to project online sales and market shares in the years
ahead. These online sales forecasts by product category are then
aggregated to derive a bottom-up forecast.
About FTI ConsultingFTI Consulting, Inc. is a
global business advisory firm dedicated to helping organizations
manage change, mitigate risk and resolve disputes: financial,
legal, operational, political & regulatory, reputational and
transactional. With more than 4,600 employees located in 29
countries, FTI Consulting professionals work closely with clients
to anticipate, illuminate and overcome complex business challenges
and make the most of opportunities. The Company generated $1.78
billion in revenues during fiscal year 2015. For more information,
visit www.fticonsulting.com and connect with us on Twitter
(@FTIConsulting), Facebook and LinkedIn.
FTI Consulting, Inc.
1101 K Street NW
Washington, DC 20005
+1.202.312.9100
Investor Contact:
Mollie Hawkes
+1.617.747.1791
mollie.hawkes@fticonsulting.com
Media Contact:
Matthew Bashalany
+1.617.897.1545
matthew.bashalany@fticonsulting.com
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