Online Consumer Spending Hits Record Highs During Holiday Season
Online consumer spending grew during the holidays as shoppers made greater use of their smartphones to purchase needed gifts, according to figures from Adobe.
Over a two-month period starting November 1, consumers spent $241.4 billion online, up 8.7% year-over-year and setting a new record for e-commerce. During the holiday season, consumers spent more than $4 billion a day on 15 different days, up from 11 days in 2023.
Mobile shopping hit a new milestone, with the majority of online transactions (54.5%) taking place through a smartphone this season (up from 51.1% in 2023). Mobile shopping was highest on Christmas Day, driving 65% of online sales (63% in 2023).
This past holiday season, traffic to retail sites from generative AI-powered chat bots (shoppers clicking on a link to a retail site) increased by 1300% compared to the prior year. Cyber Monday saw the biggest growth in chatbot usage, up 1950% year-over-year. While the base of users remains modest, the uptick shows the value that chatbots are playing as shopping assistants, Adobe said.
Grocery Growth
The strongest growth in online spending during the holidays was observed in grocery ($21.5 billion, up 12.9% year-over-year) and cosmetics ($7.7 billion, up 12.2% year-over-year), as consumers become increasingly comfortable purchasing these goods online.
“The 2024 holiday season showed that e-commerce is being reshaped by a consumer who now prefers to transact on smaller screens and lean on generative AI-powered services to shop more efficiently,” said Vivek Pandya, lead analyst, Adobe Digital Insights. “It presents opportunities for retailers to deliver new services and experiences that capture the attention of consumers, many of whom are now shopping online in different ways.”
Of the $241.4 billion spent online this holiday season, more than half (54%) was driven by just three categories; electronics ($55.3 billion, up 8.8% year-over-year), apparel ($45.6 billion, up 9.9% year-over-year), and furniture/home goods ($29.2 billion, up 6.8% year-over-year).
The strongest growth was observed in grocery ($21.5 billion, up 12.9% year-over-year) and cosmetics ($7.7 billion, up 12.2% year-over-year), as consumers become increasingly comfortable purchasing these goods online. Other categories with notable growth this season included sporting goods ($7.8 billion, up 7.4% year-over-year) and toys ($8.2 billion, up 7.8% year-over-year).
Strong discounts this season enticed consumers who have become increasingly price-sensitive. Shoppers found deals in electronics, where discounts peaked at 30.1% off the listed price (vs 31% in 2023), as well as toys at 28% (vs 28%), apparel at 23.2% (vs. 24%), computers at 22.8% (vs 24%), and furniture/home goods at 19% (vs 21%). Discounts also hit record highs for televisions at 24.2% (vs 23%), appliances at 19.2% (vs 18%), and sporting goods at 19.5% (vs 18%).
This past holiday season, Adobe’s data showed that for every 1% decrease in price, demand increased by 1.029% compared to the 2023 season. This drove an additional $2.25 billion in online spending—a figure factored into the overall $241.4 billion spent online—and shows the stronger response to discounts from price-sensitive shoppers.
Strong discounts also drove shoppers to purchase higher-ticket items in categories such as electronics, appliances, and sporting goods—propelling e-commerce growth as a result. This season, the share of units sold for the most expensive goods increased by 21%. Across categories, this figure was up 54% in sporting goods, up 48% in electronics, up 35% in appliances, up 32% in personal care products, and up 10% in apparel.
Buy Now, Pay Later (BNPL) usage hit an all-time high, contributing $18.2 billion in online spending, up 9.6% year-over-year and representing $1.6 billion more than the last season. Additionally, Cyber Monday was the biggest day on record for BNPL, driving $991.2 million (up 5.5% year-over-year). Per Adobe’s survey, consumers tend to leverage BNPL for purchases in electronics (per 57% of respondents), apparel (51%), video games (36%), groceries (33%), toys (30%), health and beauty (28%), and home/garden (19%).
