According to Zhitong Finance APP, citic sec has released a research report stating that the usa economy is approaching.But after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%.Consumer spending remains resilient, and the overall improvement in logistics efficiency accelerates the penetration of timely and cost-effective categories, continuing to drive growth in usa e-commerce. Major platforms rely on strong logistics systems and user perception to remain in a favorable competitive position, while mid-to-long tail platforms with weak supply chain capabilities and lack of differentiation, as well as traditional offline retailers, face greater pressure, showing an increasing concentration trend in the market. In addition, the dilution effect after growth, optimization of fulfillment models, increase in advertising subscription revenue, development of automation technology, and application of AI are expected to accelerate the release of profits from e-commerce platforms. The firm is bullish on the performance of the 2024 holiday season and the 2025 north american e-commerce market.

The main points of the Citic Securities research report are as follows:

E-commerce large cap: driven by consumer resilience and increased penetration, it is expected that north american e-commerce will maintain high single-digit growth in 2025.

Referencing recent macro data from the usa, the probability of a soft landing for the north american economy continues to rise, and the consumer large cap shows strong resilience. Meanwhile, in a high inflation environment, consumer price sensitivity is increasing, making e-commerce with price advantages more favored. According to the usa Department of Commerce, the total value of e-commerce in the usa reached 282.3 billion USD (a year-on-year increase of 6.6%) in Q2 2024, with a penetration rate of 19.6% (an increase of 1.8 percentage points year-on-year), among which the csi sws food & beverage index, groceries, electronics and appliances, and non-store retailers saw year-on-year increases of 8.0%/ 12.7%/ 7.9%/ 7.2%.

The bank determines that the increase in e-commerce penetration rate is due to the large-scale investment in infrastructure during the pandemic. From 2023 to 2024, improvements in domestic and cross-border logistics efficiency will drive the e-commerce growth of timely categories such as fresh food and pharmaceuticals, as well as cost-effective categories like groceries and electronics. Changes in consumer habits under high inflation have also amplified this trend. The bank anticipates that as user penetration rates steadily increase, the number of orders per user rises, and the average order value stabilizes, the CAGR of e-commerce retail sales from 2024 to 2030 is expected to reach 6.7%, with retail sales reaching 1.65 trillion dollars by 2030, corresponding to an e-commerce penetration rate of 25.6%. The bank is bullish on the performance of the 2024 holiday season (November to December) in the USA, as concentrated consumer demand under price sensitivity and increased platform promotional efforts are expected to lead to better-than-expected performance. The bank estimates that during the holiday season, the year-on-year growth rate of e-commerce retail in the USA is likely to reach 7.5% to 9.5%.

Competitive landscape: Leading companies rely on optimized fulfillment capabilities to continuously increase their market share.

According to relevant media, the total market share of the top ten e-commerce retailers in the USA increased from 48.1% in 2017 to 64.3% in 2023. The bank has observed significant differentiation in growth rates since 2023, with the Top 5 e-commerce retailers (including shopify) significantly outperforming the large cap, while most of the middle-tier companies are lagging behind, and the tail is gradually being eliminated. The bank attributes this to the higher demands of rapidly growing timely categories on the platforms' timeliness, carrying capacity, and cost control, while the cost-effective competition is facing the impact of emerging cross-border platforms, compounded by rising prices from third-party logistics providers. Participants with weak supply chain capabilities and less differentiation are gradually being eliminated.

Currently, the competitive pressure in the US e-commerce market is generally manageable, with competition primarily targeting low-priced e-commerce and other niche sectors. Among them: 1) The fundamental base and competitive barriers of leading platforms remain strong; 2) Emerging cross-border e-commerce platforms are expected to become significant players with their low-price features, but issues such as logistics capabilities, traffic costs, and tariff policies limit their ability to directly impact the market share of leading platforms; 3) Mid-tail platforms and traditional retailers face more macroeconomic and competitive pressure.

Profitability: Logistics cost optimization and technological development assist in profit release.

There is significant room for improvement in the operating margin of US e-commerce platforms, mainly due to: 1) Revenue growth diluting fixed costs; 2) Upgrading logistics distribution methods such as regionalization lowering the fulfillment costs of individual packages; 3) Rapid growth of low marginal cost businesses such as membership and subscription services; 4) Technological applications such as robots and autonomous driving improving automation levels; 5) AI technology applications reducing operational expenses for platforms and merchants. The bank is bullish on the profit release potential of leading e-commerce platforms against the backdrop of rising e-commerce prosperity and increasing concentration.

Future outlook: Continue to be bullish on leading e-commerce companies under macro resilience and efficiency improvements.

As the probability of a soft landing for the North American economy increases, residents' consumption continues to show high resilience, driving the continuous growth of the GMV of leading companies. On the efficiency front, benefiting from improved logistics fulfillment efficiency, leading e-commerce companies also have the initiative to adjust commodity prices and boost overall operating margin through high-margin businesses like membership systems and advertising. Although there are market concerns about risks such as inflation brought by tariffs, considering the strong asset liability levels of leading companies, potential tax reductions, and cost control capabilities, the bank remains optimistic about the potential excess returns of leading companies.

Investment strategy:

The current economy and consumer behavior in North America still show strong resilience, and improved logistics efficiency is driving a continuous increase in e-commerce penetration. Overall, the e-commerce sector in the usa is still in a booming cycle, and under the trends of increasing market concentration and accelerated profit release, the performance of leading e-commerce platforms is more promising. This bank is bullish on the growth momentum of leading e-commerce platforms; in the short term, the performance during the 2024 holiday season is expected to exceed expectations, which may lead to further catalysts for stock price increases; in the medium to long term, there is significant room for improvement in e-commerce penetration, market concentration, and platform operating margins in the usa.

Risk factors: the risk of rising inflation data again; risks of operating pressure on merchants caused by changes in tariff policies; the risk of the usa economy falling into recession; the risk of e-commerce companies increasing capital expenditure investments again; the continued tightening of policy regulations on technology giants; the risk that the progress of the integration of AI and e-commerce does not meet expectations, etc.