Record Online Spending Marks Black Friday as Consumers Navigate Economic Pressures
In a robust display of consumer spending resilience, Black Friday saw a record $9.8 billion in U.S. online sales, marking a 7.5% increase from the previous year, according to Adobe Analytics. This surge in e-commerce reflects a shift in consumer behavior, with shoppers keen on leveraging significant deals amid economic challenges such as inflation and high interest rates.
Adobe’s analysis, which tracks over one trillion visits to U.S. retail websites across various product categories, reveals that electronics, toys, and gaming were among the top-selling categories. Unspruprisingly, products with the most substantial discounts saw the highest sales, indicating a direct correlation between discount rates and consumer purchasing patterns.
The convenience of online shopping, coupled with the ability to compare prices easily, has played a significant role in driving this growth.
The report from Adobe highlights that $5.3 billion of Black Friday’s online sales were via mobile devices, showcasing the influence of social media and digital advertising in steering consumer spending habits.
In contrast to online sales, in-store purchases experienced a modest increase, as reported by Mastercard, with a slight over 1% rise compared to the more than 8% growth in online sales. This trend underscores a shift in the Black Friday experience, moving away from traditional in-store rushes to a more digital-driven approach.
Mainstream retailers are responding to this change by offering more aggressive discounting strategies and limited-time promotions to attract deal-seeking consumers. Companies like Best Buy and Lowe’s have ramped up their discounting levels, while others like Target and Ulta Beauty have introduced pop-up promotions.
Despite this surge in online spending, analysts anticipate a slowdown in sales post-Cyber Monday. As the final major deal day of the holiday season, Cyber Monday is expected to be the last significant spike in spending on non-essential goods for the year. However, some level of continued spending is expected, particularly from last-minute gift shoppers.
The overall increase in online sales, especially the use of ‘Buy Now, Pay Later’ options, signals a recovery from last year’s holiday season, which was marred by high inflation and heavy discounting by retailers to offload excess inventory.
This year’s holiday shopping is seen as a crucial indicator of U.S. consumer resilience, as pandemic-era savings diminish and interest rates remain high.
In terms of product preferences, footwear, sporting goods, health and beauty items led the growth, with clothing, home, and beauty products showing the most significant discounts. While online sales offer an early glimpse into holiday-season performance, initial forecasts for November and December point to modest overall sales growth, reflecting a cautious consumer environment.
