U.S. consumers spent a record $9.8 billion online on Black Friday, up 7.5% from a year ago, with more price-conscious consumers shopping online for price comparison and to score the best deals, Adobe Analytics’ latest data shows.
According to retail show, this year’s Black Friday shopping craze reflects consumers’ appetite to spend more than last year when high inflation significantly impacted mood and their willingness to engage in impulse shopping.
That is not to say that consumers are not sensitive to high prices this year. Last year’s record inflation and high-interest rates left consumers with tighter budgets, leading many to choose flexible payment options to fund their purchases this year. Some $79 million of the total sales this year were paid using buy now, pay later options, marking a 47% increase over 2022.
“We’ve seen a very strategic consumer emerge over the past year where they’re really trying to take advantage of these marquee days so that they can maximize on discounts,” said Vivek Pandya, group manager at Adobe Digital Insights.
This year, more consumers shopped for electronic products such as televisions, smartwatches, games, and toys. Meanwhile, fewer shopped for home repair products.
While online sales saw a measurable increase this year, demand across brick-and-mortar remained relatively tepid. Mastercard’s analysis of brick-and-mortar retail shows that in-store sales rose by just 1% compared to online sales.
Adobe’s Pandya noted that one of the key factors underpinning this paradigm shift in consumer behavior is the lack of interest in dealing with the typical Black Friday shopping experience, which often entails standing in long lines. According to retail show, more consumers prefer to shop online as it allows for easier price comparison, ultimately enabling them to secure the best price points.
Pandya added that more consumers are now also turning to the mobile channel to make Black Friday purchases, with influencer and social media marketing playing an outsized role, and more consumers now feel comfortable shopping on their mobile devices.
The ongoing shopping momentum is expected to extend through Cyber Monday when overall spending is projected to reach a record $12 billion. That said, this momentum will likely fade post-Cyber Monday as the best shopping deals disappear.
“We do expect growth to weaken because those discounts will weaken, and they are dictating a lot in terms of buyer behavior this season,” Pandya said.
Of course, there are the last-minute minute-shoppers who will continue to fuel demand leading up to Christmas, but Cyber Monday will likely be the final spending spike for the remaining year.
(source: Retail Bum)