Online and Mail-Order Shopping surges almost 16% in December

Yesterday (January 14) the U.S. Census Bureau released advanced estimates for December 2010 retail sales. As we first reported one month ago early indicators at that time were that online and mail-order shopping were expected to experience over 13% growth of 2009 results. Now with data in for December, the picture looks even brighter (for online retailers), indicating 15.7% growth over 2009 data (closely matching Cyber Monday’s 16% growth over 2009 recently reported by by comScore).

The Census Bureau report estimated sales activity for the entire Nonstore segment  (NAICS code 454) at almost $362 billion. This Nonstore segment includes Electronic Shopping and Mail-Order Houses NAICS: 4541, Vending Machine Operators NAICS: 4542, and Direct Selling Establishments NAICS: 4543. Over the last few years, the Electronic Shopping and Mail-Order sub-group accounts for approximately 75% of the combined category, suggesting almost $272 billion in online sales.

For a sense of scale, here is a breakdown by retail sector:

Retail Sector Total 2010
Growth
Total 2010 Total 2009 Dec. 2010
Growth
Dec. 2010 Dec. 2009
Furniture & Home 2.3% $ 91,544 $ 89,485 2.2% $ 9,184 $ 8,986
Electronics & Appliance 2.6% $ 102,699 $ 100,096 1.5% $ 13,441 $ 13,252
Home & Garden 6.3% $ 288,387 $ 271,295 12% $ 22,658 $ 20,228
Health & Personal care 3.8% $ 264,192 $ 254,520 7.2% $ 25,539 $ 23,820
Clothing & Accessories 5.1% $ 219,251 $ 199,097 8.4% $ 30,314 $ 27,955
Sports/Hobbies/Books 5.4% $ 88,154 $ 83,637 8.1% $ 12,725 $ 11,762
General & Department 3% $ 610,704 $ 592,916 3.4% $ 72,887 $ 70,475
Online & Mail-order 13.5% $ 271,373 $ 233,942 15.7% $ 34,519 $ 29,826

This table is interesting for several reasons:

  1. December was much stronger economically than the rest of the year (particularly for Home/Garden and Health/Personal).
  2. Online Retailers are far away the most rapidly growing retail sector
  3. We suspect quite a few1 of the online & mail-order transaction did not collect sales tax at the time of the transaction, even though the consumer(s) are still expected to voluntarily report and remit those sales taxes (as “Use tax”). With so many states in such deep fiscal crisis, expect the 112th Congress to finally address this issue.

As always, we welcome your thoughts!

1 “five-sixths of e-commerce sales are not taxable [at the time of the transaction] under current statutes.” University of Tennessee 2009 E-Commerce Study, Page 8

2 Responses to Online and Mail-Order Shopping surges almost 16% in December

  1. […] than doubles, to approximately $350 billion in sales for which sales tax is not collected. (See our January post on the Census figures for […]

  2. CouponBar says:

    This is some very good info on the Census Bureau

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