Adobe Predicts Pickup in Online Holiday Sales

U.S. consumers are expected to spend a record $240.8 billion online during the November through December holiday 2024 season, representing an 8.4 percent gain from holiday 2023.

That’s according to Adobe‘s online holiday sales forecast, released Wednesday. “That 8.4 percent is a nice acceleration over the 3.5 percent in 2022 and 4.9 percent in 2023,” Vivek Pandya, lead insight analyst at Adobe, told WWD. “Consumers are very responsive to discounts and value right now.” About 2.5 percent of the gain would be attributed to inflation.

Among the software giant’s predictions, U.S. retailers will be discounting just as heavily as last year, but will get a better response from America’s increasingly price-sensitive consumers than they did last year. It’s a conclusion based on Adobe data suggesting for every 1 percent decrease in price during Prime Day, President’s Day, Memorial Day and Labor Day promotions this year, demand increased by 1.025 percent compared to the year prior, driving an incremental $305 million in online spend. For holiday 2024, Adobe expects the strong consumer response to discounts will contribute an incremental $2 billion to $3 billion in online spend — a figure factored into the record $240.8 billion forecasted for e-commerce.

In other Adobe predictions:

The level of holiday shopping online, Pandya acknowledged, “is definitely not quite as strong as five years ago when it was up 13 percent, but it’s still growing at a nice clip.”

The forecasts are based on Adobe Analytics data, which covers more than 1 trillion visits to U.S. retail sites, 100 million stock keeping units and 18 product categories.

Still the outlook for holiday sales overall — both online and in physical stores — suggest a less rosy outcome. Coresight Research projects sales from October through December will be 4 percent ahead; Salesforce predicts year-over-year global sales growth of 2 percent for November and December; Customer Growth Partners gave a forecast of 2.5 to 3.5 percent, and Deloitte expects holiday retail sales to increase 2.3 percent to 3.3 percent, with the e-commerce part growing 7 to 9 percent.

Retailers are worried that Christmas sales could be negatively impacted by a potential strike at East Coast and Gulf Coast ports, as the deadline nears for a contract agreement between the International Longshoreman’s Association and the U.S. Maritime Alliance. Also, consumer sentiment on jobs, income and overall business conditions dropped in September, according to The Conference Board.

Still, Adobe projects Cyber Week (the five days from Thanksgiving to Cyber Monday) will drive $40.6 billion in online spend, up 7 percent from 2023, and representing 16.9 percent of the overall holiday season. Adobe expects Cyber Monday to remain the year’s biggest shopping day, driving a record $13.2 billion in spend, up 6.1 percent from 2023.

Black Friday will generate $10.8 billion online, up 9.9 percent year-over-year. Thanksgiving will total $6.1 billion, up 8.7 percent, year-over-year. “Both are expected to outpace Cyber Monday in growth year-over-year, as consumers embrace earlier deals,” Adobe reported.

Momentum online continues, Adobe indicated, because many categories are seeing deflationary pricing, including electronics, apparel and toys, though grocery prices are still up but starting to decrease “a little bit month-over-month,” Pandya said.

Adobe anticipates strong discounts throughout the season, and really becoming apparent around Amazon Prime Day set for Oct. 8 to 9. Not surprisingly, the five days from Thanksgiving to Cyber Monday will see even heavier online shopping with consumers anticipating discounts peaking at up to 30 percent on average for the 18 categories and millions of products Adobe gathers data from. Still, discount could be even greater closer to Christmas and in the immediate weeks after, as retailers get desperate to clear holiday goods.

“We tend to see discounts stronger online than in stores,” Pandya said. “There are a lot of different online retailers competing with each other heavily on price. That puts the consumer in the driver’s seat.”