Shoppers in the U.S. are expected to spend more than $107 billion online this holiday season.
Adobe Inc. predicts that shoppers will spend a record $107.4 billion online between Nov. 1 and Dec. 31. That revenue figure represents year-over-year growth of 13.8% from $94.4 billion, Adobe says.
The five-day stretch from Thanksgiving (Nov. 23) through Cyber Monday (Nov. 27)—traditionally one of the busiest periods for online and offline retailers—will account for 18.3% ($19.7 billion) of that $107.4 billion, Adobe predicts.
Aggressive promotional offerings from the larger online retailers will be instrumental in luring more shoppers to buy online, said Mickey Mericle, Adobe’s vice president of marketing and insights.
“This year’s record-breaking online holiday shopping season is built on the strength of the big players,” she said in a statement. “We predict the biggest retailers with wide selections, easy shopping experiences and free shipping, to drive online holiday growth this year. Still, there are opportunities for savvy small retailers to win, specifically with mobile experiences. As revenue growth plateaus, retailers will be competing hard for customers by offering steep discounts and providing a seamless customer journey.”
Online retailers are expected to offer the sharpest discounts on Black Friday, with the greatest savings on TVs (23.7% average discount), tablets (23.6%), jewelry (12%) and appliances (17.7%), Adobe says.
Of visits to retail sites this holiday season, 54% will occur on mobile devices, with smartphones accounting for 45% and tablets at 9%, topping desktop, which will account for 46% of visits.
When it comes to sales, smartphones will generate 24% of online revenue (up 26% year over year) while desktop’s share will be 66% (down 6% from 2016), Adobe says.
Adobe uses its artificial intelligence and machine learning framework to identify retail insights from trillions of data points that flow through Adobe Analytics. Adobe’s retail report is based on an analysis of 1 trillion visits to more than 4,500 retail sites and 55 million SKUs. Adobe Analytics measures 80% of online transactions at the largest 100 U.S. web retailers (based on the Internet Retailer 2017 Top 500). It also uses research based on a survey with more than 1,100 U.S. consumers and analysis from 12 million social mentions between Aug. 1 and Oct. 11.
Adobe says that in 2017 it adjusted its forecast modeling to more accurately predict and project actual retail spending, “given major discount days have impacted online shopping behaviors significantly. This methodology now looks at each day as an independent estimate, ultimately eliminating the use of constant growth assumptions, which requires Adobe to restate total online sales numbers for specific days in 2016.”
Adobe in January reported that U.S. online sales increased 10.5% for the Nov. 1-Dec. 31 holiday period, to $91.7 billion from $83.0 billion in 2015. Adobe last year had predicted sales would reach $91.6 billion. Adobe adjusted its 2016 holiday online sales figure to $94.4 billion when calculating its 2017 projection, a spokesman says.
Adobe isn’t the only one projecting more than $100 billion in online holiday sales.
Deloitte, in its 2017 holiday retail survey, predicts that U.S. consumers will spend more than $110 billion online this holiday season, which Deloitte defines as November through January. Deloitte also says online spending, at 51% of dollars spent, is expected to overtake in-store spending, at 42%, which would be a first. Catalog, direct mail and other sales avenues will account for the remaining sales.
The National Retail Federation projects that U.S. nonstore holiday sales this season (Nov. 1-Dec. 31) could increase 11%-15% year over year, to about $136.42 billion to $141.34 billion. Nonstore sales are mostly online purchases but also include sales via phone and catalog.