Record-Breaking Black Friday: Online Sales Hit $9.8 Billion, Reflecting Strong Consumer Spending Trends and Strategic Shopping Behavior
“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.”
E-commerce spending on Black Friday increased by 7.5% compared to the previous year, reaching a historic high of $9.8 billion in the United States, as reported by Adobe Analytics. This suggests a growing trend among budget-conscious consumers who are inclined to invest in the most attractive deals and actively seeking them online.
“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, a lead analyst at Adobe Digital Insights.
The surge in spending on Black Friday indicates a consumer who is more inclined to spend compared to 2022, a period marked by notably high gas and food prices.
Pandya highlighted that the growth in Black Friday sales might be attributed to impulse purchases, particularly as $5.3 billion of online sales originated from mobile shopping. He pointed out that influencers and social media advertising have contributed to making consumers more at ease with spending on their mobile devices.
However, shoppers remain price-sensitive, navigating tighter budgets amid last year's record inflation and interest rates. The Adobe survey reveals that $79 million in sales originated from consumers opting for the 'Buy Now, Pay Later' flexible payment method to extend their budgets, representing a 47% increase from the previous year.
According to the Adobe report, the best-selling categories on Black Friday included electronics such as smartwatches and televisions, as well as toys and gaming. In contrast, home-repair tools did not perform as well. Pandya noted that the top-selling items were directly linked to the products offering the most significant discounts.
Adobe compiles its data by analyzing one trillion visits to U.S. retail websites, assessing 18 product categories and 100 million unique items. It is important to note that Adobe's data collection does not include tracking brick-and-mortar retail transactions.
Additionally, a Mastercard analysis of this year's Black Friday sales revealed that in-store sales experienced a modest increase of just over 1%, whereas online sales exhibited a more substantial growth of over 8% compared to the previous year.
“I do think the paradigm has changed around the in-store Black Friday experience, the long lines and things like that,” said Adobe’s Pandya.
The online shopping environment puts consumers "more in the driver's seat," as it facilitates easier side-by-side price comparisons and the ability to secure better prices, according to industry observations.
Recognizing the prevalence of deal-hunting consumers, retailers are actively seeking to attract and retain them. Some companies, such as Best Buy and Lowe's, have announced increased discount levels. Additionally, retailers like Target and Ulta Beauty have implemented pop-up promotions featuring 24-hour discounts on specific brands and items to engage and capture the attention of value-conscious shoppers.
Black Friday sustained the positive momentum observed the day before on Thanksgiving, with online sales amounting to $5.6 billion, as reported in a previous analysis by Adobe.
Adobe anticipates that the robust spending trend will persist over the weekend and extend through Cyber Monday, with the most significant bargains still to come. The report predicts that online shoppers will approximately spend $10 billion during Saturday and Sunday combined, and a record-breaking $12 billion on Cyber Monday.
According to Pandya, spending is expected to gradually decline as the holiday season progresses. Cyber Monday, being the last major deal day of the holiday season, might represent the final surge in spending on non-essential goods for the remainder of the year.
“We do expect growth to weaken because those discounts will weaken and they are dictating a lot in terms of buyer behavior this season,” said Pandya.
Pandya pointed out that there are often procrastinating gift-givers who continue to spend in late December. However, he highlighted that the substantial growth surges typically occur in November and during Thanksgiving week.
The quotes used in this piece were extracted from CNBC.
