Packages ride on a conveyor belt during Cyber Monday at an Amazon fulfillment center on December 2, 2024 in Orlando, Florida.
Miguel J. Rodriguez Carrillo | Getty Images
The e-commerce sector is experiencing its most disruptive period in more than a decade as a result of President Trump’s trade war and tariffs policy, according to a new survey from Alix Partners. It finds steep declines in online shopping activity, and shipping and return policies being adjusted to cut costs for companies.
Online purchases for home delivery experienced double-digit percentage, year-over-year declines across major categories, including office supplies, down by 13 percentage points; sporting goods, down 12 percentage points; and cosmetics, furniture, home furnishings, and large electronics, each falling by 10 percentage points, according to AlixPartners’ data.
“This marks the first widespread pullback in online category growth in over a decade,” said Chris Considine, partner with the consulting firm’s retail practice.
Grocery was a notable exceptions to the negative trend.
Tariffs have been a catalyst for consumers to change their buying behavior, according to the AlixPartners data, which finds 34% of consumers saying they delayed purchases due to uncertainty over prices, and 66% saying they will seek domestic options if overseas prices increase by 10%. Twenty-eight percent of consumer survey respondents said they pulled ahead purchases to avoid extra import costs.
The survey showed a sizeable minority (20%) looking to “Buy American.”
“Tariffs are materially influencing consumer behavior, leading to both timing shifts and a potential reshoring of demand. Retailers may need to reassess sourcing and pricing strategies to remain competitive,” Considine said.
The online home delivery survey was conducted by AlixPartners between May 31 and June 3 among consumers, retail and transportation companies.
In addition to the tariffs impacting purchases, retailers are battling challenges with the cost of returns and delivery. The survey shows a rise in the proportion of orders being returned, at a time when almost three-quarters of executives said per-package delivery costs have increased.
Delivery and return policies are being tightened across the e-commerce sector, according to the survey, with greater emphasis on in-store pick up and returns. Consumer behavior remains heavily influenced by free shipping and next-day delivery, but almost half of retailers surveyed have increased the minimum order requirement to qualify for free shipping, or now require a membership.
Most e-commerce executives surveyed by AlixPartners said cutting last-mile delivery costs was a priority over service improvements.
