While ecommerce growth has come back down to earth after the high peaks of the pandemic, it is still expected to grow at a steady clip – and retail media is likely to come along for the ride.
In its “This Year Next Year” report, GroupM estimates that global ecommerce sales will reach $5.4 trillion USD dollars this year. Roughly 61% of the total can be attributed to just seven markets: U.S., China, Japan, Germany, U.K., Canada and Australia. Global ecommerce is expected to make up 19% of all global retail sales in 2022, growing to 25% by 2027.
Alongside that, global spending on retail media is likely to reach $101 billion USD in 2022 – 15% higher than a year ago – and will exceed $160 billion in five years’ time, according to GroupM’s forecast.
Looking just at Canada, GroupM estimates the ecommerce market will grow by 10.1% in 2022, below last year’s growth of 17.3% and well below the three-year pre-pandemic CAGR of 22%. Total retail sales will likely reach $737 billion CAD, with e-commerce accounting for 6.9% of this figure. By 2027, total retail sales are likely to be $901 billion CAD, with 8.4% occurring via e-commerce channels.
While that proportion is far lower than the global average, GroupM points out that there are several retail media offerings that will nonetheless benefit from sustained growth, be they home grown (such as Loblaw’s new DSP) or from the U.S. (such as Instacart’s paid sponsorships or Walmart Connect’s ongoing expansion). Canadians do tend to prefer supporting Canada-based online retailers like Loblaws, but American companies like Amazon and Walmart continue to be the most popular.
In Canada, 75% of people regularly shop online. Of those, 55% have made purchases on mobile devices. Looking just at those under 35, 47% make one or more online purchases per week.
Globally, the twenty top companies accounted for 67% of ecommerce sales in 2021. Not surprisingly, the top retail company in North America is Amazon, followed by Ebay, Walmart, Instacart, The Home Depot, Target, Best Buy, Costco, Wayfair, Etsy and Kroger.
