The state of ecommerce: Q3 2025

E-commerce sales showed remarkable resilience in Q3 2025, with Ordered Product Sales up 9% year-over-year despite economic headwinds. Growth was strongest in Grocery, Health & Personal Care, and Toys categories. However, this growth came with a cost—unit margins declined by 2-3% as brands absorbed rising input costs, implemented deeper Prime Day discounting and faced mounting tariff pressures.

Supply chains demonstrated stability with inventory levels increasing 19% year-over-year and Purchase Order fill rates improving to approximately 90%. Yet out-of-stock incidents continue to cause significant revenue losses, particularly in high-velocity categories like Grocery and Pet Products, highlighting the need for more sophisticated safety stock strategies and inventory management.

The advertising environment grew more competitive with retail media spending surging 22% year-over-year, while Cost Per Click and Return on Ad Spend remained relatively flat. This indicates brands are spending more to maintain visibility rather than gaining true efficiency. As Q3 closes, brands face a challenging balance: managing rising costs and competitive pressures while maintaining growth ahead of the crucial holiday quarter.

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