COVID-19 helped boost 2020 e-commerce spending by 42%

The COVID-19 pandemic shifted how consumers spent money as they ordered everything from office furniture to weekly groceries online. Adobe reports the pandemic boosted e-commerce sales $183 billion, with U.S. consumers spending $844 billion online from March 2020 through February 2021.

U.S. online spending totaled $813 billion in 2020, up 42% from 2019, the analytics firm reports. At the new growth rates Adobe expects e-commerce spending will range between $850 billion and $930 billion in 2021.

The pandemic produced a rare step change in online spending, equivalent to a 20% boost, and Adobe anticipates future growth to build off of this gain. 2022 is expected to be the first trillion-dollar year for U.S. e-commerce. Walmart CEO Doug McMillon has said the retail giant jumped ahead three years in sales online amid the pandemic. He said demand was at times unprecedented and more consumers have become comfortable ordering most of their purchases online. Walmart reported e-commerce sales gains of 79% last year.

Target grew its 2020 sales by more than $15 billion, greater than its total sales growth over the prior 11 years. Digital comparable sales rose by 118% year-over-year at Target as more consumers used curbside pickup and home delivery services. Target said sales through same-day services grew by 212% in the fourth quarter. Sales through its curbside pickup service, Drive Up, grew by more than 500%.

Adobe said the online grocery category continues to pick up steam into 2021. From Feb. 1 to Feb. 22, the online grocery category grew by 230% when compared to Jan 6 to Jan 26, 2020. Adobe also reports sporting goods saw 75% growth over the past year. Online sales for home improvement products grew 60% year-over-year. Apparel grew 22% year-over-year in the same time period, lagging other major categories. Analysts expect apparel will see increased spending this spring as the weather warms and work and leisure restrictions are lifted.

Buy-online-pickup-in-store (BOPIS) and curbside options continue to see traction, growing 67% year-over-year in February 2021. In an Adobe survey of more than 1,000 U.S. consumers, 30% of online consumers preferred curbside/in-store pickup over standard delivery options. The biggest challenge for consumers shopping online is seeing too many items out of stock, according to the survey.

Adobe also reports U.S. consumers spent $121 billion online in the first two months of 2021, a 34% year-over-year increase. The buy-now-pay-later option has seen 15% year-over-year growth in the first two months of 2021. Consumers using this service are also placing orders that are 18% larger, Adobe reports.

Adobe said regions hit hardest from shutdowns related to the pandemic saw the biggest growth in online spending. Northeastern states collectively saw 82% year-over-year online spending growth in June 2020. Western states saw the most growth in the new year (through February 2021) at 34% year-over-year. At the state level, Maine grew 60% in the first two months of 2021, the highest of any state, with North Dakota seeing the least growth at 16%.