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E-commerce retail grows 7.2% in Q2 2024 amid falling prices and margins

Posted on by darion

CommerceIQ, a leading e-commerce management (“REM”) platform, today released its Q2 2024 State of Retail Ecommerce Report, which reports e-commerce order revenue growth of 7.2% in Q2 2024 compared to Q2 2023. This growth occurred despite falling prices as consumers purchased more items at lower prices.

The report also showed a 10.1% increase in ad spend compared to the second quarter of 2023, suggesting that brands continue to focus on growth and market share despite profitability challenges.

Other findings from the Q2 2024 Online Retail Report include:

  • All categories except office supplies saw revenue growth in Q2 2024 compared to Q2 2023, with all categories except toys and pet products seeing price declines over the same period.
  • Gross margins continue to decline, likely due to a combination of pricing pressures and/or consumer demand shifting to lower-priced goods.
  • The pet and beauty categories remain highly competitive, with ad spend increasing 68% and 79%, respectively, in Q2 2024 compared to Q2 2023.
  • Sponsored Brands ads saw the biggest growth in Q2, and brands will likely be looking to build an audience ahead of Prime Day.
  • Inventory levels are rising, which until June correlated with reduced losses due to stockouts. This is likely a signal that inventory composition is not in line with actual consumer demand.

The data in the State of Retail E-commerce report is based on a compilation of anonymized data from REM’s CommerceIQ platform, which tracks tens of billions of sales from global consumer brands selling through retail e-commerce channels such as Amazon, Walmart.com and Instacart.

“Despite pricing challenges and changing consumer behavior, our platform data highlights the potential for adaptation and growth in today’s e-commerce environment,” says Guru Hariharan, CEO of CommerceIQ. “Brands that invest in AI-powered solutions to automate and optimize their online presence will be well-positioned to navigate these complexities and drive sustainable growth in an increasingly competitive marketplace.”

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