By Sabrina Escobar
2023 was a record-breaking holiday season for e-commerce, Adobe says, as price-sensitive consumers flocked to online stores in search of the best deals of the season.
Online spending rose 4.9% year-over-year to $222.1 billion from Nov. 1 to Dec. 31 this year, according to the latest data from Adobe Analytics. Ahead of the holiday season, Adobe had predicted sales would tick up 4.8%.
Last week, Mastercard released its own preliminary data, which found that overall holiday sales — which include both online and bricks-and-mortar sales — rose by 3.1% this year compared with the previous one. Online sales gained 6.3%, Mastercard said, while spending in stores increased by 2.2%.
Electronics, apparel, furniture, groceries, and toys were some of the hottest categories, Adobe said, echoing the results of November’s official retail sales report, released in mid-December.
Discounts may have helped boost splurging online. Deals for electronics, for instance, peaked at 31% off listed price; toys at 28%; and apparel at 24%. As a result, a little under 20% of the total spend came from sales during Cyber Week — the five days between Thanksgiving and Cyber Monday — Adobe said.
Shopping online also gives consumers the option to use buy now, pay later, or BNPL, to fund their shopping hauls — a move that is becoming increasingly popular, especially among younger consumers. BNPL usage hit an record high, contributing $16.6 billion in online spend, up 14% year over year, Adobe said.
“In an uncertain demand environment, retailers leaned on discounting and flexible payment methods to entice shoppers this holiday season,” said Vivek Pandya, lead analyst at Adobe Digital Insights. “The strategy was effective, driving record spend online during big days like Cyber Monday and Black Friday.”
Adobe’s data aren’t adjusted for inflation, which was up 3.1% as of the latest consumer price index report. However, spending this season was driven by “net-new demand” rather than higher prices, Adobe said. The Adobe Digital Price Index, which tracks online prices, shows that e-commerce prices were down 5.3% in December 2023.
Write to Sabrina Escobar at sabrina.escobar@barrons.com