NRF Cites Fewer Holiday-Weekend Shoppers; Adobe Scales Back Projections

The number of retail shoppers from Thanksgiving through Cyber Monday dropped from 189.6 million in a thriving 2019 to 186.4 million this year, reported the National Retail Federation Tuesday. CEO Matthew Shay cited the early start to the holiday season -- three months long this year vs. the traditional November-December span -- as one factor behind the lower in-store and online traffic during the holiday weekend. Last year’s late Thanksgiving meant fewer shopping days until Christmas, he noted. About 166 million consumers shopped the five-day period in 2018.

Adobe Analytics scaled back total holiday season sales numbers Tuesday, after Cyber Monday sales were at the low end of its projections. Based on Thanksgiving through Cyber Monday online shopping behavior, Adobe now predicts U.S. online holiday sales will total $184 billion, a 30% year-on-year increase, down from an original forecast of $189 billion. Electronics averaged 27% discounts; Apple AirPods, Apple Watches, HP and Dell computers and Chromecast streaming sticks were top-selling devices on Cyber Monday.

Monday’s $10.8 billion spend still was a new all-time U.S. e-commerce record, said Adobe, eclipsing by 15% the previous record online spending day, Cyber Monday 2019. During what Adobe calls the “golden hours of retail,” 7-11 p.m. PST, consumers spent $2.7 billion, a fourth of the day’s revenue. In the peak 8-9 p.m. PST hour, spending reached $12 million per minute. Adobe had forecast (see report, Dec. 1 issue) Cyber Monday 2020 receipts of $10.8 billion-$12.7 billion, growing 15-35%. Mobile devices generated 37% of online spending Monday, while year-on-year curbside pickup grew 30%.

Consumer holiday season spending remains on a faster track than 2019, reaching $106.5 billion, for 27.7% growth, nine days earlier than in 2019, Adobe said. Early Tuesday data showed consumers continued to shop online in “strong numbers,” it said, projecting the day’s e-commerce spend at $4.1 billion, for 26% growth. Tuesday spending projections were for goods only and didn't factor into spending for Giving Tuesday, an Adobe spokesperson emailed. “Cyber Monday continued to dominate the holiday shopping season, becoming the biggest online shopping day in US history, despite early discounts from retailers,” said Adobe Digital Insights Director Taylor Schreiner. Adobe expects record sales to continue through December and “curbside pickup to gain even more momentum as shoppers avoid crowds and potential shipping delays.”

The average consumer spend on holiday items -- decorations, food and gifts -- was down $50 Thanksgiving-Cyber Monday to $312, said NRF’s Shay. Average amount spent for gifts was $225, down $30. Shay cited the earlier start to the holiday season and robust consumer spending since May as factors behind lower Thanksgiving Week spending. Over 52% of consumers took advantage of early holiday sales and promotions, said Shay, and the past six months are up 6.4% over the 2019 period, led by October at 10.6%. Some 85% of holiday shoppers said they had started their holiday shopping in a Nov. 25-Nov. 30 survey.

NRF saw a slowdown in online shoppers on Thanksgiving vs. the rest of the holiday weekend as “everybody took the day off," said Shay. Consumers were engaged throughout the weekend, except for a Thanksgiving “breather,” he said, citing major retailers’ decision to close for the day. The number of online Black Friday shoppers passed 100 million for the first time, up 8% year on year, while online Saturday shoppers grew 17%, he said.

Online-only shoppers increased 44% over the five-day stretch to 95.7 million, said NRF. More than 40 million consumers shopped exclusively in stores; 50 million shopped both in store and online. Shay said there are fewer generational distinctions in where consumers prefer to shop: All demographic groups show “increasing engagement in the digital world.”

Electronics (27%), came in behind clothing (52%), toys (32%), books and media (29%) and gift cards (29%), said Prosper Executive Vice President-Strategy Phil Rist, citing the Nov. 25-30 survey of 6,615 adult consumers. Some 31% of consumers shopped at electronics stores, 50% online. Free shipping was the biggest tipping point for consumers hesitant about making a purchase, said Rist. Others were easy to use apps and positive customer reviews.

Responding to a question whether lower-than-expected Black Friday sales were a death knell for the November promo day, Shay noted how many times Black Friday has been “counted out” and has come back. It remains important because it’s a big day for economic activity, said the executive.

Looking a year ahead, Shay said if vaccines are distributed broadly and COVID-19 is in check a year from now, “I wouldn’t be surprised if Black Friday next year was the biggest in history.” He referenced an “enormous amount of pent-up demand for all of us to go out and to socialize and be together and to experience some of the things we miss right now.” Black Friday will continue to evolve in response to changing consumer expectations, he said, “but I would never say Black Friday was no longer relevant. It’s always going to play a role in the … traditional kickoff to the holiday season.”

On how potential upcoming lockdowns could affect the remainder of the holiday sales season, Shay said retailers can demonstrate that a retail environment is safe during the pandemic. He took issue with designations of what is an “essential business.” If state or local governments imposed what NRF believes are “unfair or unreasonable restrictions” on businesses, the association will challenge those. Retailers are prepared with personal protective equipment and procedures, flexible fulfillment operations and with inventory to meet consumers’ needs through year-end, he said.

Addressing the level of promotional activity in the remaining weeks, Shay said inventory levels “are very lean.” He doesn’t believe retailers will be left with “substantial goods” on shelves. “You’re not going to see an environment in which retailers need to do the kind of promotional discounting that impacts margins.” Promotions will be “thoughtful” and “consistent with the holiday season.” Though consumers started shopping earlier and embraced Thanksgiving deals, many still have about half of their holiday shopping to do, said Shay.

Shay credited NRF’s awareness campaign for consumers’ early start to shopping and its message about precautions retailers took to ensure safe shopping. Retailers were ready to fulfill consumers’ wishes for contactless shopping, online shopping and in-store pickup and curbside pickup options, he noted. An earlier NRF survey said 70% of consumers felt safe shopping in stores. About 77% said they were more interested in shopping to support small or local businesses affected by the pandemic, Shay said, citing a level of trust in neighborhood stores. NRF predicts a November-December holiday retail spend of $755.3 billion-$766.7 billion for growth of 3.6-5.2%.