NetElixir Forecasts 11% Ecommerce Growth for 2016 Holiday Season

The 2016 holiday season prediction season has begun, with moderate ecommerce growth expected by search marketing agency NetElixir.

NetElixir predicts that ecommerce growth for 2016 will be between 10.5% and 11%, which it says is a moderate estimate compared to other recently published reports like eMarketer, which forecast a 17% increase.

NetElixir attributes its conservative forecast to three key factors including: Earlier than usual purchasing of holiday gifts driven by Amazon’s Prime Day and other large retailers following the trend; retailers using online marketplaces to sell products rather than directly on their sites; the uncertain political environment, which has traditionally negatively impacted online shopping trends.

Another key factor affecting this holiday season is a surge in mobile shopping. NetElixir projects that mobile phones will drive more than 35% of last-click conversions this holiday season. Amazon is also projected to take 28% to 30% of holiday sales this year, up from 26% in 2015.

“Our projections for this holiday season indicate that retailers shouldn’t expect this year to bring in the same types of gains that the past few years have brought,” said Udayan Bose, founder and CEO of NetElixir. “With the ecommerce slowdown, uptick in mobile purchases and Amazon taking a larger share of the season, retailers should be aligning their digital marketing efforts to match consumers’ attention and interests. Catching a consumer on the right device at the right moment and time is of the utmost importance and will help retailers to have a more fruitful holiday season.”

NetElixir holiday outlook was compiled through an ongoing analysis of key retail search metrics and trends for NetElixir’s mid-size and large customer base with significant holiday season ecommerce sales, since 2012.

NetElixir’s Retail Intelligence group applied sophisticated forecasting models on the aggregated data, investigating specific areas like prior-key event ecommerce sales, market share tracking for Amazon vs. rest of retail ecommerce, variation in basket size over time and other key factors.

Additionally, Deloitte forecasts a 17% to 19% increase in ecommerce sales, reaching $96 to $98 billion during the 2016 holiday season.

Deloitte also forecasts that digital interactions will influence 67%, or $661 billion, of retail store sales this holiday season. This figure reflects the amount of traditional brick-and-mortar retail sales impacted by shoppers’ use of digital devices including desktop and laptop computers, tablets and smartphones.

“While attention toward presidential elections may be a temporary distraction in the early part of the holiday shopping season, it should not have a negative impact on sales, and retailers may benefit from a pickup in post-election consumer spending,” said Daniel Bachman, Deloitte’s senior U.S. economist.

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