Some days I think I’ll explode if one more person asks me “How’s it going?” Because I just don’t know. The nightly news is full of recession stories but in the morning I go to work in a business that shows no sign of slowing down. It’s enough to make your head spin.
On April 15, the Wall Street Journal grimly reported that “retail sales tumbled in March as job losses and tight credit left consumers cautious and constrained, damping hopes for a rapid economic turnaround.”
Now I wouldn’t say that the Wall Street Journal is wrong. Indeed, I would say it’s more objective than NBC Nightly News (where NBC apparently stands for Nothing But Crisis). And I certainly don’t think anyone is expecting a rapid economic turnaround. But I work in online marketing and the impression I get at work each day is that the ecommerce department in most companies just didn’t get that memo about the economic slow down. And there are some numbers to back that up.
On April 27, a survey by Forrester Research and Shop.org indicated online retail sales in the U.S. rose an average of 11% in the first three months of 2009. In times like these, that’s an impressive number.
Furthermore, as eMarketer reports, Citi Investment Research is projecting growth in US retail ecommerce sales of 4.4% in 2009, taking it to $141 billion for the year. Citi says that it expects that growth rate to jump to 16.5% in 2010. Those are not recession-style numbers. They sound like recovery to me. As you can see from the table, ecommerce has been outpacing overall retail performance by a considerable margin. From where I sit there’s ample reason to think this will continue to be the case.
Every day I see savvy online retailers furthering their investment in new technologies and services in order to improve their performance and profitability (as well as their competitive edge). And every day I see evidence of that effort in companies who are achieving double-digit increases in revenue from the judicious use of new marketing technology.
However, even within the microcosm of online retailing, the numbers can be contrary. In the Forrester Research and Shop.org survey, about 70% of consumer brand manufacturers reported online sales increases. The same was true of multichannel retailers (companies that have bricks and mortar stores as well as an online store). However, companies that only sell on the web were apparently not faring as well, with 6 out of 10 reporting sales declines.
My guess is that the companies we work with are among the other 4, or perhaps some of the 6 who want to get into the other column. My point is that we’re hosting a roundtable next week that should help all 10. The title is “Map Your Path to Online Optimization: A whole new way to reach your goals.” It features my CEO, David Brussin, and Eric Koger, the CEO of one of today’s hottest online fashion stores, Modcloth.
David and Eric will be talking about the importance of targeting the right segments of your online retail traffic to achieve the best conversion rate, average order value, and overall revenue. The payoffs from this strategy are both immediate and long term. For CMOs who are now planning their Q4 strategy, the message from these two CEOs will be: “Put the techniques and technology in place now to start reaping the rewards right away, and you will be well-placed to maximize holiday revenue through effective targeting of the right traffic segments as that traffic ramps up.”
And despite the confusing numbers so far this year, I have a feeling those Q4 numbers will ramp up. In which case, the smart money will be on the ecommerce sites that can make the most of it.
BTW, here’s a link to details of next week’s roundtable.