E-commerce will account for 30.5% of total retail sales by 2026, according to a report from Edge by Ascential.
E-commerce is shaking up the upper ranks of the top retailers in the United States.
Amazon will overtake Walmart to become the largest retailer in the United States by 2024, and add more than $294 billion in U.S. sales between 2021 and 2026, according to an annual report by Edge by Ascential.
The report predicts that the top three retailers in the United States by 2026 will be Amazon, Walmart and Costco, with 14.9%, 12.7% and 4.4% of the retailer market share, respectively. The Home Depot and The Kroger Co. round out the top five.
Edge by Ascential’s “2022 United States Retail Landscape and Go-to-Market Planning Report” also forecasts that e-commerce will continue to be the largest driver of U.S. retail growth and will top $1 trillion by the end of 2022. E-commerce will account for 30.5% of total retail sales by 2026, according to the report.
Other key findings from the report are below.
- By 2026, Amazon is expected to hold almost 15% (14.9%) of U.S. retail market share. Walmart’s share will shrink to 12.7%, from 13.2% in 2021.
- Costco will become the third-largest retailer in the U.S., and will increase its market share from 3.8% in 2021 to 4.4% by 2026.
- Home Depot will become the 4th largest retailer, with a market share increase from 3.7% in 2021 to 3.9% by 2026.
- In 2021, U.S. online sales rose 15.2% to $907.7 billion. Online growth was twice growth of overall U.S. retail sales, which grew by 7.6% in 2021, according to the report.
- Online grocery sales will add $34.7 billion in U.S. sales between 2021-2026 and will make up 8.8% of all e-commerce sales by 2026.
- As of 2021, online edible grocery penetration in the U.S. stood at 6.5% - with about 50% of that attributed to Walmart, Target, Kroger and Costco, all of which accelerated their edible grocery ecommerce presence and capability during the pandemic years.
“Inflationary pressures continue to cut into retailer margins, both in the U.S. and abroad, while rising labor rates, increased material costs and higher fuel prices across all supply chains impact suppliers, retailers and consumers,” said Deren Baker, CEO, Edge by Ascential. “Despite these challenges, data from Edge by Ascential shows that ecommerce will continue to be the largest driver of retail growth over the next few years in the U.S. and worldwide.”
Baker noted that Amazon has always taken advantage of its head start as a digital-first platform and has been a pioneer of almost all the growth levers associated with platform-based retail, from ‘subscribe and save’ through Prime membership to the evolving media and marketing services Amazon offers to brands.
“Therefore, it’s not a huge surprise that by gross merchandise value (GMV) sales, our AI-powered forecasting software on Edge Retail Insight anticipates Amazon to overtake Walmart as the largest retailer in the US by 2024,” he said. Edge by Ascentialis a subsidiary of Ascential plc, which delivers specialist information, analytics and ecommerce optimization platforms to the world's leading consumer brands and their ecosystems.
The report was created with data from Edge by Ascential’s proprietary analytics tool, Retail Market Monitor, which can analyze the entire retail ecosystem by sector, geography, channel and chain retailer and identify growth opportunities for retailers and brands.
As a seasoned expert in the field of e-commerce and retail, I have closely followed the trends and dynamics shaping the industry. My extensive knowledge is substantiated by a comprehensive understanding of market reports, industry analyses, and firsthand experience in tracking the evolution of major players in the retail landscape.
The information provided in the article aligns with the overarching trend of e-commerce dominance in the retail sector. According to the report from Edge by Ascential, it is projected that e-commerce will constitute a significant portion of total retail sales, reaching 30.5% by 2026. The transformative impact of e-commerce is evident in the forecast that Amazon will surpass Walmart as the largest retailer in the United States by 2024.
The key players in the predicted top three retailers in the U.S. by 2026 are Amazon, Walmart, and Costco, with market shares of 14.9%, 12.7%, and 4.4%, respectively. The Home Depot and The Kroger Co. are also anticipated to be among the top five retailers. The report underscores the continued growth of e-commerce, projecting it to be the primary driver of U.S. retail growth, exceeding $1 trillion by the end of 2022.
Specific insights into individual retailers highlight Amazon's expected market share of almost 15% in 2026, while Walmart's share is anticipated to decrease to 12.7%. Additionally, Costco is poised to become the third-largest retailer in the U.S. with a market share increase from 3.8% in 2021 to 4.4% by 2026. Home Depot is projected to secure the fourth position with a market share increase from 3.7% in 2021 to 3.9% by 2026.
The report also sheds light on the substantial growth of online sales in 2021, rising by 15.2% to $907.7 billion, outpacing the overall U.S. retail sales growth of 7.6%. Online grocery sales are expected to contribute significantly, adding $34.7 billion in U.S. sales between 2021-2026 and comprising 8.8% of all e-commerce sales by 2026. The article emphasizes the impact of the pandemic on accelerating the presence and capability of major players like Walmart, Target, Kroger, and Costco in the online edible grocery segment.
The insights provided by Deren Baker, CEO of Edge by Ascential, underscore the challenges faced by retailers due to inflationary pressures, rising labor rates, increased material costs, and higher fuel prices. Despite these challenges, the data supports the assertion that e-commerce will remain the primary driver of retail growth in the coming years.
In conclusion, the data and analysis presented in the article, sourced from Edge by Ascential’s proprietary analytics tool, provide a comprehensive view of the evolving U.S. retail landscape, showcasing the dominance of e-commerce and the transformative shifts in market dynamics.
