Drugstores like CVS and Walgreens improved their digital offerings despite financial challenges, with CVS's paid membership program contributing to its success. Dollar and off-price stores saw revenue increases due to external economic factors and a consumer shift towards cost-conscious purchases. Despite their lower e-commerce rankings, these stores performed well financially, with plans for expansion in response to recent revenue growth. However, they face competition from direct-to-consumer brands partnering with off-price competitors.
Key takeaways:
- The retail industry in 2023 experienced both financial downturns and digital opportunities, with AI technology playing a significant role in the latter.
- E-commerce sales in the U.S. continued to grow, with a 2.3% increase in Q3 2023 from the previous quarter, and a 5.6% increase in December spending compared to 2022.
- The Modern Retail Index (MRI) analyzed retailers' performance in 2023, focusing on eight sub-dimensions of e-commerce, including virtual product experience, checkout, reviews, customer service, customer benefits, app scores, social commerce presence, and paid membership.
- Big box retailers like Walmart and Best Buy dominated in e-commerce, while drugstores improved their digital offerings, and dollar and off-price stores saw revenue increases despite lower e-commerce rankings.