Online retail sales top expectations during 2022 holidays, but huge return volumes put pressure on logistics

Retailers sold $1.14 trillion online according to Salesforce data, but 13% of orders were sent back by consumers

Retailers outperformed expectations this holiday season says Salesforce data, but at a cost. The research found that during the key period consumers spent a total of $1.14 trillion online globally and $270 billion in the US. However, 1.39 billion orders were returned, equivalent to 13% of total purchase volume, which represented a 63% increase in returns year-on-year.

Furthermore, retailers were forced into heavy discounting to shift inventory, marking down goods by an average of 21% between Thanksgiving and Christmas, compared to 19% the year prior.

However, Salesforce did note that there is a rapidly growing channel that offers lower costs that direct-to-home delivery in the form of Buy Online Pick Up In Store (BOPIS), with huge growth reported in the December 15-24th window.  Close to a fifth of online orders placed globally this holiday season were via BOPIS, with a peak point of demand seeing 35% of all orders on the Friday before the Christmas holiday shipping in this way.

Those with BOPIS capability in this critical window grew their revenue nearly seven times faster than those without according to Salesforce.

"Retailers closed out the 2022 holiday season with stronger online sales growth than expected – driven in large part by U.S. demand, steeper discounts on peak days, and BOPIS options," said Rob Garf, VP & GM of Retail, Salesforce. "Staggering return numbers show that consumers are still cautious amid economic uncertainty, however."

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