Adobe predicts that the 2023 holiday season will bring record online sales, but with heavy discounting.

Adobe Data: Ecommerce Expected to Hit Record Sales During 2023 Holiday Season But With Steep Discounting

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Adobe has released its online shopping forecast for the 2023 holiday season, which spans from November 1 to December 31, 2023.

The company predicts U.S. online holiday sales to reach $221.8 billion during the specified period, indicating a 4.8% growth year-over-year (YoY). In comparison, the 2022 season witnessed online spending of $211.7 billion, with a 3.5% YoY growth.

Factors such as unprecedented discounts and the rising popularity of the Buy Now, Pay Later (BNPL) spending method, anticipated to facilitate $17 billion in online spending (a 16.9% increase from 2022’s $14.5 billion), are expected to influence spending this season.

Cyber Week Spotlight: A Deep Dive Into Predicted Spending and Discounts

During Cyber Week, which includes Thanksgiving, Black Friday, and Cyber Monday, online spending is expected to reach $37.2 billion, a 5.4% YoY increase, and constitute 16.8% of the entire holiday season spending.

Adobe foresees Cyber Monday retaining its position as the peak shopping day of the season and year, potentially generating a record $12 billion in spending, a 6.1% YoY increase.

Black Friday online sales are projected to grow by 5.7% YoY to $9.6 billion, while Thanksgiving could see a 5.5% YoY increase to $5.6 billion.

Patrick Brown, Vice President of Growth Marketing at Adobe, commented that despite the unpredictable economic climate and challenges like rising interest rates, robust ecommerce growth is expected this season due to record discounts and flexible payment methods.

He added that BNPL has gained mainstream acceptance and will simplify shopping, especially on mobile devices, which are anticipated to host over half of online spending.

Adobe Predicts Big Discounts

Adobe also anticipates record discounts this season, with reductions of up to 35% off listed prices, as retailers navigate an uncertain spending environment and consumers grapple with escalating costs in various sectors, including food and gas.

Noteworthy discounts are expected across several categories, including toys, electronics, and apparel, during Cyber Week, which is projected to offer the most substantial discounts.

The BNPL payment method is projected to establish new records this season, propelling $17 billion in online spending, a 16.9% YoY increase, and $2.5 billion more than the previous year.

Adobe predicts BNPL spending to reach $9.3 billion in November, marking it as the largest month on record. Cyber Monday is poised to be BNPL’s largest day with $782 million in spending, exceeding Cyber Monday 2022’s daily record of $658 million.

Additional insights from Adobe Analytics suggest that mobile shopping will account for over half (51.2%) of online spending during this holiday season, reaching a record $113 billion, a 13.7% YoY increase.

Top-selling items are expected to include LEGO Minifigures, Kanoodle 3D, Barbie the Movie products, and various gaming consoles and games, among others.

Ecommerce categories anticipated to drive growth include electronics, apparel, furniture/home goods, groceries, and toys, contributing $144.2 billion to the season’s overall spend of $221.8 billion.

Adobe also notes that early shopping is expected this year, with events like a second Prime Day in October and other promotional events encouraging consumers to shop sooner.

Lastly, Adobe’s Digital Price Index indicates that online prices have decreased consecutively for 12 months, down 3.2% YoY in August 2023.

Forecast Methodology: This forecast is derived from Adobe Analytics data and examines U.S. ecommerce trends by analyzing over 1 trillion visits to U.S. retail sites, 100 million SKUs, and 18 product categories. Adobe Analytics, a component of Adobe Experience Cloud, is utilized by over 85% of the top 100 U.S. internet retailers to optimize online shopping experiences.

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