Adobe Pegs Overall Holiday Spend at $189B; 12 Days to Reach $3B
Online sales will top $2 billion every day Nov. 1-21, swelling to $3 billion daily Nov. 22-Dec. 3, Adobe Analytics forecast Wednesday. Overall, Nov. 1-Dec. 31 holiday season e-commerce sales will total $189 billion, “shattering all previous records” with a 33% year-on-year surge, Adobe said. Overall retail growth is expected to tick up 1%-1.5%.
Another round of government stimulus checks -- or a shutdown of physical stores in large parts of the country due to rising COVID-19 cases -- could produce an additional $11 billion in online shopping, it said. That would take total online spending for the holiday period to more than $200 billion, it said.
High-profile Black Friday and Cyber Monday sales days are projected to pull in more than $10 billion in e-commerce sales, up 39% over 2019. Cyber Monday will again be the biggest online shopping day of the year, generating $12.7 billion, a 35% spike, said the analytics firm. Some $6 billion will be spent online on Thanksgiving, a 42.3% rise. Cyber Week, traditionally Thanksgiving Day through Cyber Monday, will be replaced this year by “Cyber Months,” Adobe said.
Mobile shopping will continue its upward surge, with U.S. consumers spending $28.1 billion more on their smartphones than a year ago, a 55% bump. Smartphones will generate 42% of online sales during the Nov. 1-Dec. 31 holiday season, said the report. Retailers with $10 million-$50 million in annual online revenue will have a 107% sales boost, while larger retailers will grow revenue 84% over the stretch, Adobe said.
Nov. 1-Nov. 22, consumers are forecast to spend $56 billion, 37% over 2019. A third will complete holiday shopping by Black Friday, said an October survey of over 1,000 consumers. Three-quarters of all retailers are offering discounts earlier than last year; less Black Friday “doorbusting” will take place due to earlier deal offers and store closures.
The best day for TV deals will be Black Friday when prices are expected to be discounted 19%, said the report; the best computer prices are expected Nov. 28, slashed by an average 18%. General electronics will get the most discounting, 18% on Dec. 18, it said. Toy discounts will be steepest Nov. 29, at 30%, it said.
Half of all orders Dec. 21-23 will be at retailers that offer a buy online, pick up in store (BOPIS) option, up 40% from last year, which is expected to result in longer pickup lines later in the season. Shoppers are 9% more likely to buy at retailers that offer BOPIS or curbside pickup on big sale days. Health concerns factor into 19% of consumers’ plans for BOPIS or curbside pickup this year vs. 4% last year.
Consumers’ expectations for free and fast shipping are increasing: 64% percent of consumers said they won’t spend extra for expedited shipping. The spend required for free shipping is expected to be 4.1% lower during the holiday season; the day after Cyber Monday will require a 50% less spend for free shipping vs. the rest of the season, while two Fridays before Christmas, Dec. 11, is the last day for less expensive shipping.
Orders placed the day before Thanksgiving are 51% more likely to be returned, 52% for Dec. 23 purchases, Adobe said. Some 15% of gift receivers returned more than a quarter of their gifts last season, said the survey. Postal delays due to overwhelmed shipping systems could result in late gift arrival, pushing up return rates, it said. Shoppers will send gifts directly to 18% more people overall this holiday season due to the coronavirus and social distancing, peaking at 67% more gifts sent the week before Christmas, it said.
Adobe predicts a 13% drop in sales the day after the election vs. the previous three days, totaling $16.3 billion online. About a quarter of consumers said knowing the election outcome will affect their holiday spend; 63% of retailers believe consumers will be more confident in spending after the election.
Thirty-one percent of consumers rarely shopped online before April; 9% were net new to online shopping, said the report. New customer revenue grew 65% year on year since April 1 for small businesses, 49% for large retailers. Average order value is seen remaining flat vs. 2019. Adobe data is based on “trillions” of visits to U.S. e-commerce sites, tracking 100 million SKUs and transaction data from 80 of the top 100 U.S. web retailers.
EMarketer said Wednesday retailers are “bracing for a softer Holiday season” due to the pandemic but will have a “major shift to ecommerce.” U.S. consumers will spend $190.47 billion Nov. 1-Dec. 31 on holiday ecommerce purchases, up 35.8% from 2019. In-store holiday sales will decline by 4.7% to $822.79 billion, said the research firm; but online gains will make up for losses, resulting in total holiday season sales growing by 0.9% to $1.01 trillion, it said.
“This holiday season will see a continuation of the channel-shift to ecommerce, as shoppers look to avoid crowds and minimize their number of in-person shopping trips,” said analyst Andrew Lipsman. With a spike in e-commerce sales, there's growing concern about "shippageddon," where high package volumes overwhelm logistics capacity, resulting in post-Christmas deliveries, Lipsman said. EMarketer believes consumers will pull forward purchases due to shipping arrival concerns and make more BOPIS orders over the last 10 days of the season to avoid late arrivals.
The Cyber Five promotional period -- Thanksgiving Day through Cyber Monday -- will continue to grow its share of the total holiday ecommerce pie, rising slightly this year to capture 20.5%, with $39.1 billion in spending, up 39.6% from last year. The five-day period will have some record-breaking days, starting with Thanksgiving, forecast to have a 49.5 increase to $6.2 billion, said Lipsman: "With most big-box retailers keeping their doors closed on Thanksgiving, we anticipate shopping will move to mobile, making it the ultimate day for 'couch commerce.'” Black Friday will experience its first $10 billion spending day, rising 39.4% year over year; Cyber Monday will see a 38.3% rise to $12.9 billion, he said.