Adobe Report: Holiday Shopping Season Drove A Record $222.1 Billion Online

Adobe has released online shopping data for the 2023 holiday season, covering the period from Nov. 1 through Dec. 31, 2023.

Based on Adobe Analytics data, the report provides the most comprehensive view into U.S. e-commerce by analysing commerce transactions online, covering over one trillion visits to U.S. retail sites, 100 million SKUs and 18 product categories. Adobe Analytics is part of Adobe Experience Cloud, relied upon by over 85 per cent of the top 100 internet retailers in the U.S. to deliver, measure and personalise shopping experiences online.

Strong holiday season online driven by record discounts, ‘Buy Now, Pay Later’ 

Consumers spent $222.1 billion online from Nov. 1 to Dec. 31, up 4.9 per cent year-over-year (YoY) and setting a new record for e-commerce. A total of $123.5 billion was spent online in November (up 6 per cent YoY), bolstered by a strong Cyber Week—the five days between Thanksgiving and Cyber Monday—which drove $38 billion in spend online (up 7.8 per cent YoY). In December, consumers spent $98.6 billion online (up 3.7 per cent YoY), partly driven by discounts that lingered past Cyber Monday. 

Across major e-commerce categories, discounts hit record highs this holiday season. Shoppers found great deals in electronics, where discounts peaked at 31 per cent off the listed price (vs 25 per cent in 2022), as well as toys at 28 per cent (vs 34 per cent) and apparel at 24 per cent (vs. 19 per cent). Discounts were substantial across other categories, including computers at 24 per cent (vs 20 per cent), televisions at 23 per cent (vs 17 per cent), appliances at 18 per cent (vs 16 per cent), sporting goods at 18 per cent (vs 10 per cent) and furniture at 21 per cent (vs 8 per cent).  

While consumers showed a strong appetite to shop online, many are giving themselves greater flexibility with their budgets. This holiday season, ‘Buy Now, Pay Later’ (BNPL) usage hit an all-time high, contributing $16.6 billion in online spend, up a significant 14 per cent YoY and representing $2.1 billion more than the last holiday season. November was the biggest month on record for the payment method ($9.2 billion, up 17.5 per cent YoY), and Cyber Monday was the biggest day on record ($940 million, up 42.5 per cent YoY). BNPL saw strong traction leading up to the holiday season as well: Year-to-date (Jan. 1 to Dec. 31), the payment method drove $75 billion in online spend, up 14.3 per cent YoY and $9.4 billion more than 2022. 

“In an uncertain demand environment, retailers leaned on discounting and flexible payment methods to entice shoppers this holiday season,” said Vivek Pandya, lead analyst, Adobe Digital Insights. “The strategy was effective, driving record spend online during big days like Cyber Monday and Black Friday, and a record 11 days that surpassed $4 billion in daily spend this season.”

Electronics, apparel, furniture, groceries and toys are driving e-commerce growth 

Of the $222.1 billion spent online this holiday season, over half (65 per cent) was driven by five categories, including electronics ($50.8 billion), apparel ($41.5 billion), furniture ($27.3 billion), groceries ($19.1 billion) and toys ($7.7 billion). These categories have become key growth drivers in the digital economy.

Within the electronics category, top sellers this holiday season included TVs, smart speakers, tablets, Bluetooth headphones and smartwatches. In apparel, pyjamas, sneakers and cold weather clothing (fleeces, sweatshirts, base layers) were top sellers. Barstools, throw pillows, and Christmas décor were popular in the furniture and home category. Top toys this season included Barbie products, Disney Little People, Uno Show No Mercy, KidKraft Playsets and Squishmallows. Super Mario Bros. Wonder, Spiderman 2 and Call of Duty: Modern Warfare III were hot sellers in video games, and the Nintendo Switch, PlayStation 5 and Xbox Series X were top gaming consoles. Other hot sellers this season included skin care serums and moisturisers, cordless and robotic vacuums, and small kitchen appliances (coffee makers, air fryers, instant pots). 

Additional Adobe Analytics Insights  

• Mobile shopping overtook desktop: This holiday season, mobile hit a new milestone, with 51.1 per cent of online sales coming through smartphones (up from 47 per cent in 2022). Mobile shopping was highest on Christmas Day (Dec. 25), driving 63 per cent of online sales (61 per cent in 2022). As consumers spent time with friends and family, many used their smartphones to take advantage of final deals or to redeem gift cards. Strong mobile growth in recent years has made this a key channel for retailers moving forward.
• Curbside pickup remains popular: The fulfilment method was used in 18.4 per cent of online orders this holiday season for retailers that offer the service (21 per cent in 2022). Now, with roughly one in every five orders online utilising curbside pickup, consumers have shown that this fulfilment method continues to provide value, especially for shoppers who value speed and convenience. This season, curbside pickup peaked from Dec. 22 to Dec. 23 (right before Christmas Eve), driving 36.8 per cent of online orders as anxious shoppers used the service to ensure they received gifts on time.
• Retailers’ marketing investments: Across significant marketing channels, paid search remained retailers’ biggest sales driver this holiday season (29.4 per cent of online sales attributable to that channel). Direct web visits (19.3 per cent), affiliates/partners (16.6 per cent), organic search (15.9 per cent) and email (15.3 per cent) were also significant contributors. Revenue directly attributable to social media remained at less than 5 per cent of total sales this season, but that share has grown 5 per cent YoY.

Impact of inflation

Strong consumer spending this season has been driven by net new demand, as opposed to higher prices. The Adobe Digital Price Index, which tracks online prices across 18 product categories (complements the Bureau of Labor Statistics’ Consumer Price Index, which also includes prices for offline-only products and services like gasoline and rent), shows that e-commerce prices have fallen for over a year now (down 5.3 per cent YoY in December 2023). Adobe’s numbers are not adjusted for inflation, but if online inflation were factored in, there would be even higher growth in topline consumer spend.