Benchmarking Data for Ecommerce Budgeting for 2023

Part 2 of Setting Your Ecommerce Budget for 2023

This is part of a 5 part series on setting your ecommerce budget for 2023. For an easier to read all-in-one PDF of the entire series, download our Setting Your Ecommerce Budget for 2023 guide.

In our analysis of publicly traded US-based ecommerce brands, we’ve found that non-marketing ecommerce spending in the most recent two fiscal years (typically 2021 and 2020) ranged from 1% to 5% of sales with an average of 3.1% of sales. Looking at these numbers as a percentage of gross profit, ecommerce spending ranges as 3.62% to 20.35% of gross profit, with an average of 10.42% of gross profit. These retailers tend to be larger retailers, so even at a relatively low percentage of sales they are spending a minimum of $14 million per year on their ecommerce investments against sales in the high hundreds of millions of dollars, if not higher. For ecommerce brands closer to tens-of-millions than hundreds-of-millions in sales, a total spend of about 15% of gross profit on your non-marketing ecommerce budget is average.

From this data, depending on the scale of your business and if this is a year where you’re launching major new projects such as replatforming, you will likely want to budget between 10% and 15% of your gross profit on ecommerce projects.

What does non-marketing ecommerce spending include? For retailers running on their own proprietary ecommerce platform, this includes the software development and infrastructure expenses to build and support that platform. However, this is becoming incredibly rare, so typically retailers are utilizing a cloud-based commercial platform to power their ecommerce website, in which case this includes the license and usage fees for that platform as well as any software development expenses internally or with an external systems integrator or solution partner to support the platform.

Now that we understand what other companies are setting their ecommerce budgets at, let’s look how to set your ecommerce budget. Stay tuned for the next post in this series - Setting Your Ecommerce Budget for 2023.