2025 Ecommerce Year in Review: Growth didn’t disappear, easy growth did

If 2025 taught ecommerce leaders anything, it’s this: growth didn’t vanish, it got more expensive, more operational, and far less forgiving.

On the surface, Amazon ecommerce delivered another year of expansion. Industry revenue grew 5.5%, proving demand is still there. But underneath that topline number, the mechanics of growth changed in ways that caught many brands off guard.

Growth came from selling more units, not charging more. Units rose 10.2%, while average selling price fell 4.3%, even as discounting eased materially. In other words, brands discounted less and still realized lower prices. Competitive pressure and mix shifts did the rest.

This wasn’t a year where brands could rely on promotions or traffic spikes to carry results. 2025 forced a different discipline.

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Download the full 2025 Retail Ecommerce Year in Review Report now to benchmark your performance.

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Demand held. Execution decided who won.

One of the most important shifts in 2025 was where growth didn’t come from.

Traffic was essentially flat (glance views down 0.4%). Shoppers didn’t suddenly flood the marketplace. Instead, brands that performed better did so by converting demand more effectively.

Industry conversion improved from 22.3% to 24.6%, a meaningful lift that points to better digital shelf execution, stronger availability, and tighter retail readiness. Brands got better at turning intent into orders and that became the difference.

At the same time, supply-side execution improved sharply. PO fill rate jumped from 77.1% to 90.2%, one of the biggest year-over-year improvements we’ve seen. Operational reliability is no longer a nice-to-have, it’s a prerequisite for growth.

And yet, even with better execution, many brands felt like they were running harder to stand still.

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The cost of growth went up quickly

While execution improved, economics moved in the opposite direction.

Unit margins fell from 19.4% to 16.7%, a 2.6-point compression that showed up across categories. At the same time, brands leaned more heavily on retail media to sustain volume.

Ad spend rose 19.6%, nearly four times the rate of revenue growth. But higher investment didn’t translate into better efficiency. CPCs increased 8.4%, and ROAS declined from 4.85x to 4.46x, down 8.1% year over year.

The result? Brands paid more to generate each incremental dollar of revenue — and kept less of it.

2025 made one thing painfully clear: spend alone is no longer a growth strategy. Efficiency is.

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Availability improved but leakage got smarter

At first glance, availability looked like a win in 2025. Reported out-of-stock rates improved across the industry.

But a deeper look revealed a more nuanced (and more dangerous) pattern: revenue loss from availability issues didn’t disappear; it shifted.

Lost Buy Box and high-value OOS events increased, meaning that while brands were out of stock less often, the misses that remained were more expensive. Stockouts increasingly hit higher-demand, higher-value moments, especially during peak periods.

In 2025, availability wasn’t just about being in stock; it was about being in stock where it mattered most.

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Category performance diverged sharply

The macro story of 2025 played out very differently by category.

Some categories, like Pet Supplies, showed what “clean growth” looks like: higher revenue, better conversion, reduced discounting, and even margin expansion.

Others, including Furniture and Health & Personal Care, struggled with demand pressure, weaker paid efficiency, and tighter economics.

Across categories, one pattern held: the brands that treated execution as a growth lever outperformed those that treated it as hygiene.

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What 2025 changed going forward

The biggest takeaway from 2025 isn’t pessimistic; it’s clarifying.

The market didn’t punish growth.
It punished waste.

It punished:

• Inefficient media spend
  
  
• Poor availability at critical moments
  
  
• Leaky execution between traffic, conversion, and fulfillment
  
  
• Growth strategies optimized for scale, not profit
  
  

And it rewarded brands that connected pricing, inventory, retail media, and operations into a single, disciplined system.

As brands plan for 2026, the lesson is clear:

The winners won’t be the ones who spend more.
They’ll be the ones who operate more tightly.

Growth is still there. But in today’s ecommerce landscape, it has to be earned deliberately, efficiently, and profitably.

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Download the full 2025 Retail Ecommerce Year in Review Report now to benchmark your performance.

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