Deep discounts on everything from beauty products and toys to electronics during the Thanksgiving weekend enticed U.S. shoppers to splurge about $38 billion online, signaling a strong holiday shopping season even as economic uncertainty swirled.
Online consumer spending jumped 7.8 percent during Cyber Week, or the five days from Thanksgiving through Cyber Monday, according to data from Adobe Analytics, outstripping initial expectations for a 5.4 percent rise.
In the lead-up to the crucial shopping season, industry forecasters including Deloitte and retailers like Walmart and Macy’s warned of cautious consumer spending due to sticky inflation constraining budgets. But blockbuster deals helped spread the holiday cheer for bargain-hunters.
More than 200 million shoppers made purchases both in-store and online during the Thanksgiving weekend, the National Retail Federation (NRF) said on Tuesday, representing a near 2 percent increase from last year and surpassing the trade association’s estimates of 182 million.
Still, with about half of Americans’ holiday shopping left untapped, the NRF stuck to its forecast for 3 percent–4 percent retail sales growth during the full November–December holiday season, saying consumers will continue to look for big promotions and bargains.
On an average, consumers spent $321.41 on holiday-related purchases including toys, electronics and gift cards during the Thanksgiving weekend, compared with $325.44 last year, the NRF data showed.
Discounts as steep as 31 percent on electronics and 27 percent on toys and the ease of making last-minute purchases from the comfort of people’s homes have given online sales an edge over in-store shopping.
‘Buy Now, Pay Later’ Drives Big Spending OnlineIn a bid to stretch their Christmas budgets, shoppers are also leaning on Buy Now, Pay Later (BNPL) services such as Klarna or Affirm to avoid the extra fees and interest that come with credit card payments.
A record $940 million worth of purchases were made through BNPL on Cyber Monday, surging 42.5 percent from last year and trouncing Adobe’s earlier estimate for an 18.8 percent jump, as consumers took advantage of the flexible payment option.
Payments firm Block noted BNPL transactions through Afterpay surged 19 percent over the weekend, adding that online shopping cart sizes were 3.9 times bigger than in-person shopping.
Klarna also said it saw a 29 percent increase in orders placed by U.S. shoppers on Black Friday.