Dive Brief:
- Indicating the lasting appeal of e-commerce, Adobe Analytics predicts consumers will spend $209.7 billion online between Nov. 1 and Dec. 31, a 2.5% increase year over year from the $204.5 billion spent online in 2021, according to its holiday forecast.
- Adobe anticipates that consumers will spend $11.2 billion during Cyber Monday, a 5.1% year-over-year increase. Black Friday digital sales, on the other hand, will only grow 1% to $9 billion.
- Adobe predicts that consumers will see discounts as early as the second week of October, when retailers are expected to offer discounts as high as 15% off. The report notes that consumers could spend $103.8 billion on electronics, apparel and groceries online during the holiday season, about half of the anticipated overall spending.
Dive Insight:
With Amazon’s second Prime Day happening in October this year, and other retailers following suit, Adobe predicts some spending will happen earlier this season.
"The shape of the holiday season will look different this year, with early discounting in October pulling up spend that would have occurred around cyber week," Patrick Brown, vice president of growth marketing and insights at Adobe, said in a statement. "Even though we expect to see single-digit growth online this season, it is notable that consumers have already spent over $590 billion online this year at 8.9% growth, highlighting the resiliency of e-commerce demand."
In addition to Amazon’s second Prime sale, Target introduced a set of holiday deal days in early October, well before the Cyber Monday and Black Friday holiday sales events. Kohl’s and Walmart announced similar early deals last week.
Despite the challenging economic environment as shoppers struggle with inflation, Adobe predicts that buy now, pay later transactions will slow this holiday season. Between January and September this year, BNPL online revenue share only rose by 5% compared to the same period in 2021. Last year during the holidays, Adobe found that BNPL revenue increased by 27% compared to 2020 and 475% compared to 2019.
Leading up to the holidays, industry experts and retailers have had to revise their future projections to account for changing consumer habits. In a report released earlier this month, Cowen analysts said they foresee risks to retailers’ holiday projections as retailers contend with higher costs for labor and rent. Consumer behavior is also changing thanks to inflation, with multiple major retailers, including Target, Walmart and Best Buy, changing their financial predictions in recent months as a result.
