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Digital Commerce 360 | Retail

Online spending represented 16.0% of total retail sales for the year, according to a Digital Commerce 360 analysis of Commerce Department retail data. Amazon accounted for more than a third of all ecommerce in the United States.

Consumers spent $601.75 billion online with U.S. merchants in 2020, up 14.9% from $523.64 billion the prior year, according to the U.S. Department of Commerce quarterly ecommerce figures released Wednesday. That was a higher growth rate than 2020, when online sales reported by the Commerce Department rose 13.6% year over year.

Online’s share of total retail sales has steadily been on the rise—with ecommerce penetration hitting 16.0% in 2020, according to a Digital Commerce (formerly Internet Retailer) analysis of the Commerce Department’s year-end retail data. That was up from 14.4% in 2020 and 13.2% in 2020. The growth in penetration was the biggest annual percentage point jump at least since 2000, the first full year the department began tracking ecommerce spending.

Total retail sales increased 3.8% in 2020 to $3.763 trillion from $3.626 trillion the year before, according to Digital Commerce estimates using Commerce Department figures. The performance of overall retail last year marked a slight slowdown from 2020, when sales through all channels jumped 4.1%. Digital Commerce 360 studies non-seasonally adjusted Commerce Department data and excludes sales of items not normally purchased online such as spending at restaurants, bars, automobile dealers, gas stations and fuel dealers.

Ecommerce also accounted for more than half—56.9%—of all gains in the retail market last year. That’s the largest share of growth for online spending since 2008, when ecommerce represented 63.8% of all sales growth. Plus, this is only the third time in the history of U.S. retail that the year-over-year dollar gains for online purchases exceeded the gains for in-store spending in a given year.

Q4’s online growth bounces back from 2020 but slows from Q3

In the fourth quarter of 2020, U.S. ecommerce sales reached $187.25 billion, up 16.4% year over year from $160.89 billion in 2020. Q4 fared much better in 2020 than the same period in 2020, when online sales rose just 10.8%. That was the second lowest rate for the quarter ever, behind a 6.1% decline in Q4 2008.

Despite the recovery, last year’s Q4 growth was a deceleration from the 17.3% uptick in the third quarter of 2020. Growth in the latter half of 2020 was significantly higher than the year-over-year online sales growth registered in the first six months of the year, when ecommerce increased 11.6% in Q1 and jumped 13.6% in Q2. The third quarter’s rate also marked the highest quarterly growth since Q4 2020, when online revenue spiked 18.6% over the same period the previous year.

Ecommerce penetration hit 18.0% in the fourth quarter of 2020, marking online’s highest ever recorded share of total retail sales. That compared with 16.1% for the same period during the prior year. Growth in digital sales also accounted for nearly two-thirds—65.2%—of all retail gains in Q4, up from 52.2% a year earlier.

When factoring out Digital Commerce 360’s excluded categories, total retail sales in Q4 experienced the same trends. The fourth quarter had a 4.1% boost in overall retail spend to $1.038 trillion from $998.04 billion in 2020—a slower year-over-year growth than 4.8% in Q3 2020 but a better showing than Q4 2020, when total retail increased only 3.1%.

Amazon’s continuing domination of ecommerce sales

Amazon.com Inc., No. 1 in the 2020 Digital Commerce 360 Top 1000, continues to dominate in ecommerce, growing market share to the chagrin of its competitors. The total value of transactions on Amazon.com in the U.S. grew 25.3% to reach $221.95 billion in 2020 from $177.10 billion the previous year, according to Digital Commerce 360’s early estimates of Amazon’s gross merchandise value. This includes sales of Amazon’s own products and items sold by third-party marketplace sellers.

This would mean Amazon alone represented more than a third—36.9%—of all U.S. ecommerce last year. Additionally, the web behemoth accounted for more than half—57.4%—of ecommerce growth and nearly a third—32.7%—of total retail gains through all sales channels.

Top ecommerce stories from 2020

To help bring the numbers into focus and better understand the ecommerce landscape for the year, it’s worth a look back at the big headlines in retail in 2020.

French luxury giant LVMH (No. 20) bought jeweler Tiffany & Co. (No. 179), fast-fashion chain Forever 21 (No. 115) filed for bankruptcy before staging a comeback, and established beauty brands snapped up DNVBs to appeal to young, hip shoppers. Plus, omnichannel programs had a big year, Nike (No. 33) ditched Amazon, and web-only retailers saw the value of physical stores.

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For more on retail shake-ups—including bankruptcies and acquisitions—major news and trends that emerged last year, read 2020’s year in review.

US Ecommerce vs. Total Retail Sales Year over Year

Year Total Retail Sales US Ecommerce
2020 $3,484 Billion $461 Billion
2020 $3,626 Billion $524 Billion
2020 $3,763 Billion $602 Billion

Online’s share of growth in total retail* sales

Online and in-store sales as a % of total retail* spend, 2020

Ecommerce growth higher in second half of 2020

Year-over-year growth, by quarter

  • Q1: 11.6%
  • Q2: 13.5%
  • Q3: 17.4%
  • Q4: 16.4%
  • Fiscal Year: 14.9% growth, year-over-year

Heartul.com Review: Heartul Online Store is Another Risky Ecommerce

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5 Essential E-Commerce Rich Snippets for Your&nbspStore

Using Google’s rich snippets in your e-commerce store is one of the best tactics for increasing the visibility of your products, enhancing your click-through rates (CTR), and driving more revenue. This tactic is not only effective, but quick and easy to implement as well.

In this article, we’re going to examine what the five essential rich snippets for your online store are and how to add them.

What are rich snippets?

Rich snippets are a form of structured data which help website owners add extra details about their website and its contentso that search engines can better understand, interpret, and display relevant data.

It’s basically a common “language” for people to describe their websites, which in turn helps search engines do a better job of presenting important information to potential customers.

Google’s Knowledge Graph and rich snippets are both essential for enabling entity-based search, and present a powerful means for e-commerce shops to sell more products.

For example, Google commonly supports rich snippets for a variety of categories, including products, recipes, reviews, events, and software applications. You can find more information on how rich snippets work in this excellent visual guide.

While Google has confirmed (via The SEM Post and other sources) that rich snippets do not directly result in higher rankings, they can indirect help by enabling search engines to better understand the content they crawl.

Why e-commerce rich snippets are essential

What’s even more important than rankings is the opportunity rich snippets give you to stand out in the search results of warm prospects (that is, people who are already searching for your product) and increase your CTRs. For example, which one of the following four listings catches your eye immediately?

The Amazon one with a five-star rating and fourteen reviews catch your eye of course, even though its position on the page is less enviable due to i’s lower ranking. The extra visual detail it has gives it a much better chance at grabbing a warm prospect’s attention (and, ultimately making the sale).

One experiment from Catalyst Search Marketing saw a 150% improvement in CTR.

Also, e-views sell. Consider these stats reported by Econsultancy.com:

  • People are 63% more likely to buy if there are product reviews.
  • Reviews produce an average lift in sales of 18%.
  • Bad reviews actually improve conversions by 67%!

Another minor benefit of using rich snippets is through brand management; making sure that you’re controlling how your product information is showing up.

One thing you don’t want is misinformation or inaccuracy hurting your store’s credibility before even having a chance to get the customer to your website.

The top five e-commerce rich snippets

While there’s a large variety of possible rich snippets you can use, here is a breakdown of the five most popular ones for e-commerce shops:

1. Product

First and foremost, you should be primarily concerned with ensuring that search engines understand they’re looking at a product page (vs. a blog post, for instance).

The result is that your product is better positioned to appeal to the right searcher, at the right time, with a more relevant description in the search engine results:

In the example from Target above, you can see that the additional information displayed clearly indicates that the search result represents a product for sale. Not only do you have the pricing information, but you can see site links below that show related products this person might be interested in.

2. Ratings and reviews

One of the best ways to sell a product online is through third-party testimonials. In this case, reviews and ratings of a product from actual customers is significantly more effective than the most compelling ad copy.

In the above example, Best Buy utilizes an extremely high rating to assure viewers that not only is this a good product, but that they (by logical extension) are a trustworthy business. You can’t sell anyone anything without first establishing credibility and trust.

3. Pricing

One of the first things people want to know about the product they’re looking for is how much it cost, especially when it’s a commodity sold in multiple locations.

In this example, Best Buy once again does a great job of highlighting pricing, so people don’t have to hunt for important purchasing criteria that might sway their opinion.

Right after the price, though, you can see that the product seems to be “out of of stock” in this example, which brings us to the next essential rich snippet for e-commerce stores:

4. Availability

How many times have you visited a store, shopped around, and then tried to purchase the perfect product—only to be told they’re out of stock?

One of the best reasons to shop online is that many e-commerce sites make this information readily available. Shoppers can make faster, better-informed decisions by scanning the search results until they find what they are looking for—and know that it’s also in stock, thanks to rich snippets that indicate product availability.

5. PPC

Google AdWords provides numerous rich snippets that will grab shoppers’ attention and improve the performance of your text ads.

In addition to some of the rich snippet examples we’ve already reviewed, you’ll notice that they’re also picking up location and displaying contact information with opening hours to drive both online and offline sales.

Google Shopping’s product feed helps you dynamically display products, pricing, and availability with eye-catching visuals that stand out from competing text-based listings..

It should be obvious now that adding structured data to your product pages makes them immediately noticeable and undoubtedly more effective. With that in mind, let’s move on to explore how you can implement rich snippets for your online store.

How to add rich snippets to your online store

The best approach to implementing rich snippets is to simply use the product properties provided by Schema.org to mark up each product (with the help of a developer or technical team).

For example, looking at the source code from an earlier Best Buy example, you can see some of the popular Schema properties being displayed:

Another tool that is especially helpful if you don’t have access to technical expertise is Google’s own Structured Data Markup Helper. It helps you visually tag and assign values for each common property.

The first step is to select the appropriate category for your product, then enter the URL of the product you’d like to tag.

Once you’ve done that, the Markup Helper tool will pull up a visual representation of the page, which you can manually highlight.

After selecting a specific element, you’re able to tag it and assign a value. In the right-hand window, you can see how the data items will stack up. This view also helps you keep track of what elements you might be missing and need to tag before finishing.

Finally, once everything is tagged and you’re happy with how it looks, you can export the HTML source code with the newly created markup.

After using Google’s Markup Helper (or the assistance of a developer) to add the structured data to your site, it’s time to double check everything with Google’s Structured Data Testing Tool.

The first step is to either input your source code or paste the product page URL so that it can validate what you’ve done so far:

The result is a view of what elements are assigned to the product you’re viewing, which you can then double check for accuracy:

There are many other tools that can help you check and verify this information, including Screaming Frog and Website Auditor.

Rich Snippets are worth the effort

Rich snippets and other forms of structured data help you do a better job of translating your website’s information for search engines, helping them in turn to do a better job of presenting that to potential customers effectively.

Making your product listings stand out in the search results with visuals, ratings, pricing, and availability is one of the best ways to grab attention from other product listings and build trust with potential customers.

What has been your experience with rich snippets? Have you been able to implement them and see a noticeable difference?

Heartul.com Review: Heartul Online Store is Another Risky Ecommerce

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2Checkout Credit/Debit Cards, PayPal 2.4% + 0.30€
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