Make it Through This Year, E-Commerce Players, And It's Back to Living Large

Recession-weary US retailers that cut back on E-Commerce system development to save money might be shooting themselves in the foot, especially if there's any truth to an optimistic new forecast by analysts at eMarketer.

The eMarketer gurus are predicting online sales will rebound next year and, in 2011, "return to the double-digit growth rates seen prior to 2008." Of course, companies need to stay in business long enough to see that sunny day. EMarketer says retail E-Commerce sales will drop by 0.4 percent in 2009, ending the year at $133.1 billion. 2008 online retail sales came in at $133.6 billion, according to U.S. Department of Commerce figures cited by eMarketer.

Given the day-after-day deluge of dire financial news we're now suffering, one wonders what eMarketer folks see that incites their optimism. In their report, the eMarketer prognosticators say online retail sales growth will blossom in 2010 primarily "from online buyers who shift a greater share of their discretionary spending from stores to the Web."

Predicting sales will also be buoyed by "pent-up consumer demand especially among affluent shoppers," the forecasters call for 9.8 percent growth in 2010 — to $146.1 billion — followed 13.3 percent growth in 2011 — to $165.6 billion.

The expansion will continue in 2012 when, eMarketer predicts, online sales will reach $184.5 billion. However, the analysts believe 2012 will be the year E-Commerce sales growth begins to slow "due to the inevitable maturation" of the industry. Nevertheless, the outlook for 2013: a lovely $203.5 billion in online retail sales.

"All told, from 2008 to 2013 retail e-commerce sales will increase at a 9 percent compound annual growth rate (CAGR)," predicts eMarketer.

It's mildly interesting to compare new analyst predictions with older ones. For example, back in February 2006, Jupiter Research said U.S. online shoppers were going to increase their online spending at a rate of 12 percent annually through the end of 2010. Jupiter said online spending would hit $144 billion in 2010, a figure that's pretty close to eMarketer's new $146.1 billion for 2010 number and one that is rather remarkable given Jupiter, like most everybody else, did not foresee a 2008 recession of epic proportions.