Adobe Data: 2022 Holiday Season Online Shopping Hit New Record

Adobe data released Thursday shows that American consumers spent a record $211.7 billion online, up 3.5% year-over-year (YoY), during the 2022 holiday season (Nov. 1 to Dec. 31).

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Of note: This final figure for the season also surpassed Adobe’s pre-season forecast of $209.7 billion in expected ecommerce spending.

During the five days between Thanksgiving and Cyber Monday, also known as Cyber Week, consumers spent $35.3 billion online, up 4% YoY.

Another metric of note is that on 38 days, shoppers spent more than $3 billion/day, equaling last year and surpassing the 2020 holiday season when there were 25 such spending days. 

What economic concerns: Despite inflationary and macroeconomic concerns leading into the holiday season, demand for common gift categories exploded. Toys led the way in November and December, growing 206% compared to pre-season levels in October 2022.

Additional primary categories with a big boost during those two months were video games (up 115%), and apparel/accessories (up 94%).

Sub-categories with strong demand included watches (up 108%), baby toys (up 101%), gift cards (up 98%), cosmetics (up 90%), outdoor grills (up 86%), speakers (up 76%), and smart home products (up 67%). 

Top Sellers: Legos, Hot Wheels, Paw Patrol, LOL Surprise, Squishmallows, Bluey, and Cocomelon for toys. Top gaming consoles included Nintendo Switch, Xbox Series X, and PlayStation 5, while top games included God of War, Madden 23, FIFA 23, and Call of Duty.

Apple Airpods and Roku devices also did very well, but on a more surprising note, air fryers, vacuums, and umbrella strollers topped the popularity list as well.

Shoppers Loved Big Discounts 

Discounts: Unusually high pre-season inventory levels at both physical and online retailers drove deep discounts, and shoppers were happy to snap up bargains. Discounts hit record highs this holiday season across most major ecommerce categories.

Toys led the way again peaking at 34% off list prices (vs 19% in 2021), and in electronics, discounts peaked at 25% (vs 8%).

Other categories with strong discounting included:

• Computers at 20% (vs 10%)
• Apparel at 19% (vs 13%)
• Televisions at 17% (vs 11%)
• Appliances at 16% (vs 4%)
• Sporting goods at 10% (vs 6%)
• Furniture at 8% (vs 2%)

What they’re saying: “At a time when consumers were dealing with elevated prices in areas such as food, gas, and rent, holiday discounts were strong enough to sustain discretionary spending through the entire season,” said Vivek Pandya, lead analyst, Adobe Digital Insights.

“The big deals drew in consumers and drove volume, helping retailers who were challenged with oversupply issues, particularly in categories such as apparel, electronics, and toys.” 

Additional Adobe Analytics Insights

Mobile shopping: 47% of online sales came through smartphones (up from 43% in 2021). On Christmas Day (Dec. 25), shoppers reached for their phones, setting a new mobile record by driving the majority of online sales at 61% (up from 58%).

With retailers failing to move the needle on mobile shopping, it appears investments in better mobile shopping experiences have finally led to stronger sales on small screens. Or could it be that smartphone screens are just getting bigger? Either way, there was some movement this season.

Buy Now Pay Later (BNPL): BNPL growth may have slowed a bit. But with inflation and the uncertain economic outlook, shoppers explored new ways to manage their budgets.

In this holiday season overall, BNPL orders rose 4% YoY. However, revenue decreased by 2%, indicating shoppers used BNPL for smaller purchases. 

Curbside pickup: Among online retailers that offer this service, there was a decline (21% vs 23%) in this fulfillment method compared to 2021.

However, in the last few “scrambling” days (Dec. 22 to Dec. 23), curbside pickup peaked at 42% of online orders, with anxious shoppers using the service to get gifts in time.

Despite the slight decrease, curbside pickup continues to be a popular fulfillment method for omnichannel retailers to drive sales.

Impact of marketing investments: Paid search remained the top marketing channel for retailers this holiday season (29% of online sales attributable to that channel).

Direct web visits (19%), organic search (17%), affiliates/partners (16%), and email (15%) continued to be significant marketing channels.

With all the talk about social commerce and social media driving the future of ecommerce, social media remained less than 3% of total sales this season, but that still represented growth of 24% YoY.

The impact of inflation: Adobe’s data revealed that strong consumer spending online was driven by net-new demand, not simply higher prices due to inflation.

The Adobe Digital Price Index (DPI), which tracks ecommerce prices across 18 categories, indicates that prices online have been dropping YoY since September 2022.

While Adobe figures do not adjust for inflation, the company said if online inflation were factored in, there still would be growth in underlying consumer demand.