Mastercard SpendingPulse: Estimated $53 Billion in Additional U.S. E-Commerce Sales as Pandemic Drives Consumers Online in April and May

New Recovery Insights Report Spotlights the Impacts of COVID-19 

Consumer spending appears to be normalizing in a number of markets, according to Mastercard SpendingPulse¹, which tracks overall retail sales across all payment types, including cash and check. To dig into this further, Mastercard today released the first report in its Recovery Insights series, which sheds light on the impacts of the pandemic and stay-at-home orders, including the incredible growth of online shopping.

In the U.S., per Mastercard SpendingPulse, total retail sales for May saw a marked improvement from April (-5.6% ex-auto year over year compared with -14.1%, respectively) as some states started the reopening process and stimulus funds continued to buoy consumer spending. Meanwhile, U.S. e-commerce sales, per Mastercard SpendingPulse, were up 92.7 percent in May, underscoring the broader shift to digital in how we work, live and shop. Note that e-commerce follows the Census definition*. 

While the shift to digital has not been universal or consistent – due to geographical, economic, and household differences – there are a number of key overarching trends: 

• E-commerce doubles in share of sales. In the U.S., e-commerce in April and May made up 22 percent of all retail sales, up from 11 percent in 2019. Another way to put it? More money was spent online in the U.S. during that period than the last 12 Cyber Mondays combined.
• The $53B boost. In April-May, more than $53 billion of incremental spending occurred on e-commerce channels in the U.S. This comparison is based on the typical e-commerce growth rate and e-commerce sales for the same period in 2019.
• Nesting drives home improvements. In May, U.S. hardware sales across online and in-store were up 36.2 percent compared to 2019. In addition, furniture sales grew 7.5 percent year-over-year in May, the strongest growth rate for the sector since August 2018. 
• Wants vs. Needs. In the U.S., demand for groceries remains elevated, with sales up 9.2 percent year-over-year in May across online and in-store. This is the strongest grocery sales volume for the month of May in SpendingPulse history. The focus on necessities is also highlighted by our U.K. estimates for April, when e-commerce spending on groceries increased 64 percent year-on-year vs. 16 percent year-on-year for luxury. 
• E-commerce around the world. Globally, we’ve also seen some redistribution of sales away from brick and mortar into online channels after the onset of the outbreak. In April and May 2020, e-commerce as a share of total retail sales reached 33 percent in the U.K. – an unprecedented high (ex. auto, petrol, and restaurants). 
  

“The shift to digital ways of shopping has been undeniable, while everything else has been incredibly unpredictable,” says Steve Sadove, Mastercard senior advisor and former CEO of Saks. “The question is what changes will stick around for the long-term. Investing in your home and shopping local are two recent trends. Heightened demand for touchless services is another, which could have tremendous impact on what stores actually look like and how they blend their online and brick and mortar footprints.”

Mastercard has been committed to helping retailers, restaurants, CPG brands and many others navigate the challenges of the pandemic – and now the recovery. This has included making certain insight-driven tools available at no cost to governments and small businesses to give a timely snapshot of economic performance during this time. Having the ability to make informed decisions is critical to the long-term success of companies, communities and individuals around the world.