Paid search drives largest share of online purchases so far in 2024

By April Berthene

May 15, 2024
online sales increase

Paid search was the largest driver of online sales for retailers so far this year, with 28.2% of online sales Jan.1-April 30 directly attributed to this channel, according to new data from Adobe Analytics. Direct web sales were the second largest driver, with nearly one in five purchases initiating in this way, followed by:

  • Affiliates/partners — 17.1%
  • Organic search — 15.9%
  • Email — 15.4%
  • Social media 2.7%
  • Display — 1.1%

This 28.2% of online purchases stemming from paid search is roughly the same share as this time period a year ago, according to Adobe. Paid search as the leading marketing channel is not a surprise, said Vivek Pandya, lead analyst at Adobe Digital Insights.

“Given the strong targeting capabilities paid search provides to retailers, we were not surprised that this continues to be a major marketing channel for those looking to drive sales,” Pandya said.

Compared with January-April 2023, sales stemming from direct web and email increased the most, while sales from organic search and display decreased the most, according to Adobe.

Overall, U.S. consumers spent $331.6 billion online in the first four months of the year, a 7% year-over-year increase, according to Adobe data. Adobe’s data is based on analyzing online retail transactions online, covering over one trillion visits to U.S. retail sites, 100 million SKUs and 18 product categories.

Online spend by category
Spending in the electronics and apparel categories together contributed 34.5% to spend during this Jan. 1-April 30 period and helped maintain ecommerce growth.

Online grocery sales were also strong, with the category’s sales increasing 15.7% year over year and reaching $38.8 billion in online sales.

“Groceries is a standout, and Adobe expects that in the next three years, the category will be a dominant force in ecommerce that is on par with electronics and apparel in revenue share,” Pandya said.

Impact of inflation on online spending
Adobe also analyzed how inflation is impacting online sales. For the month of April 2024, online prices have decreased 5.6% compared with April 2023.

Adobe also analyzed online inflation over time by dividing each category’s prices in four quartiles, highest to lowest. It then tracked shares of units sold in the most expensive and least expensive quartiles from January 2019 to April 2024.

Adobe found that shoppers increased their online spend on cheaper goods in the following categories: personal care, electronics, apparel, home/garden, furniture/bedding and grocery.

In the grocery category, for example, sales grew for goods with low inflation by 13.4%, while products with high inflation had revenue drop by 15.6%.

Other insights from Adobe include:

  • Sales made through buy now, pay later services in the first four months of 2024 increased 11.8% year over year, totaling $25.9 billion in ecommerce spend.
  • Sales made through mobile devices increased 9.8% year over year, totaling $156.9 billion and making up roughly 47% of total ecommerce spend.