The global pandemic has profoundly changed how we interact with online channels, and the 2020 holiday season was no different, with many records broken. Not only did we see record growth in terms of online spend but new shopping trends quickly emerged, fast-forwarding the industry years into the future.
According to Adobe Analytics, between November and December, consumers spent a record $188.2 billion online, 32% more than 2019, a profound growth, particularly considering the challenging economic landscape brought on by the pandemic. While COVID-19 kept people home and out of physical stores, many pivoted to online shopping – some for the first time – while also leveraging new omnichannel options like BOPIS (buy online, pick up in store) or curbside pickup. Undoubtedly, the pandemic significantly impacted when people buy, how people buy, and what they bought.
Holiday shopping extends to a month
In 2020, the most obvious change in ecommerce was around when people shopped online. Retailers historically have come to expect Cyber Monday and Black Friday to be the biggest shopping days of the year. Those days certainly didn’t disappoint in 2020, with $10.8 billion and $9 billion spent online, respectively. Simultaneously, the holiday shopping week evolved into a holiday shopping month—extending the normal five-day period to more than 30 days.
Retailers have spent decades figuring out how to draw in more customers on Black Friday and Cyber Monday. Now that the holiday season is more spread out, retailers must rethink their sales and promotion strategies. A more distributed season means more predictability, greater flexibility with pricing and marketing, and less strain on logistics systems. It’s more convenient for consumers to shop earlier in the season and have confidence that they are not missing out on any good deals.
In 2020, Cyber Monday was the first day in U.S. history to cross $10 billion in overall online sales. Black Friday, too, had an impressive run reaching $9 billion. However, the Cyber 5 days (Thanksgiving through Cyber Monday) grew only 21% over 2019—well below the average rate of 32% across the holiday season, and certainly not levels of growth we saw at the beginning of the pandemic. Instead of increased sales over Thanksgiving weekend, we saw a rise before and after Thanksgiving. Before Thanksgiving, retailers pushed hard to convince consumers that their best deals were coming in early.
Retailers also anticipated shipping constraints late in the season were likely to lead to disappointed customers who may not receive their packages in time. Retailers that pushed Black Friday-month and week-long sales in early November saw a greater payoff. On average, consumers bought 31% more goods between November 1 and Thanksgiving Day compared to 2019. After Thanksgiving, people continued to shop increasingly online than they had before. For example, Christmas Eve online sales surpassed $1 billion for the first time.
Retail’s online future shines brightly
While consumers spent more time at home and thus more time in front of their desktops, laptops and voice assistants, smartphones remained the most popular online shopping device. Of note, Adobe Analytics found that more than half of the dollars spent online on Christmas Day came from smartphones alone. Retailers that continually improved their mobile shopping experiences—with features like enhanced product searches and simplified checkout with various payment options—saw great success in the 2020 holiday season.
We also saw an uptick in omnichannel options like buy online, pick up in store (BOPIS) and curbside pickup as a popular way for consumers to stay safe during this pandemic. From November to December, the number of online orders fulfilled via curbside pickup was up 88% year over year, a record-breaking amount.
New categories thrive online in 2020
The changes in what people bought were perhaps the most intriguing shifts of the 2020 holiday season. As consumers turned to ecommerce for safety, peace of mind and more selection, they bought household items from dish soap to pet supplies and even deck chairs online. For example, even before Thanksgiving, consumers were buying five times as many groceries, four times as much alcohol (wine especially), and more than three times as much housekeeping supplies, nonprescription drugs and personal care products as they had bought in October. While pandemic-induced shifts in online shopping may appear temporary, the question remains whether the change in consumer behavior will outlive the virus.
The 2020 holiday shopping season was a glimpse into how consumers prefer to shop and what retailers need to do to keep up with demand. Because of the pandemic, digital has become the primary way for people to connect, work, be entertained and shop, helping set online spending records for the holiday season. With online shopping already heightened throughout the holiday shopping season, we can expect trends like BOPIS usage, optimized mobile shopping, pro-longed discounting by retailers to continue through 2021.
Adobe Digital Insights publishes research for consumers, marketers and business leaders.