The state of retail ecommerce | Q3 2024

Despite declining ROAS, brands gained strong sales momentum driven by increased ad spend—while prioritizing inventory management and operational efficiency for peak season readiness.

Q3 often marks a critical period for ecommerce brands, characterized by steady growth from Prime Day, back-to-school and early holiday shopping. To capture increased consumer interest, brands typically raise ad spend, enhancing visibility but adding pressure on ROAS. Inventory and supply chain management become priorities as brands gear up for Q4, balancing promotions, stock levels and operational efficiency to handle peak season demands.

What happened in Q3 2024?

Despite margin pressures from rising inventory and advertising costs, sales growth in Q3 2024 remained strong, supported by increased ad spend to boost product visibility. 

While ROAS saw declines, operational efficiency saw improvements, with optimal fill rates and generally well-managed supply chains. In key categories like Health & Personal Care, Grocery and Pet Products, pricing stability reflects consumer demand for cost-effective options. 

Key takeaways from Q3 2024

In our latest industry report, the data is clear: Customers are still looking for lower prices while brands struggle to make every retail media dollar count. But despite rising inventory and ad costs in Q3, sales growth remained strong—driven by seasonal demand and tentpole events like Prime Day and back-to-school shopping deals. 

Cross-category sales growth

Brands experienced strong YoY growth across categories, largely driven by seasonal demand and tentpole events like Prime Day. 

Rising inventory costs

Increasing cost of goods sold (COGS) is squeezing margins, even with stable pricing.

Declining advertising impact

Increased ad spending boosted visibility, but ROAS declined with steady CPCs–indicating mix shift to lower ASP items.

Improved operational efficiency

Record-high fill rates and optimized supply chains are improving operational efficiency to meet demand for anticipated seasonal spikes and events.

Category insights

Health & Personal Care, Grocery & Pet Products maintained stable pricing, with consumer shifts toward cost-effective products.

 

Get all the insights from Q3 2024 and see how your category stacked up. Download the report.