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Record online discounts are coming this holiday season

by Mark Mendoza

According to projections released by Adobe Analytics, online shoppers can expect to be offered record-setting discounts this holiday season. Retailers are eager to entice consumers who have been affected by inflation, and the company predicts that these enticing discounts will lead to a nearly 5% increase in online holiday sales compared to last year.

In its annual holiday forecast, Adobe states that retailers will offer discounts of up to 35% off listed prices, with the deepest discounts available for toys, electronics, and apparel. This is good news for consumers looking to take advantage of these deals and spend aggressively, despite concerns about rising costs and the overall state of the economy.

Adobe predicts that consumers will spend a total of $221.8 billion on online shopping between November 1 and the end of the year, representing a solid growth rate of 4.8% compared to last year’s 3.5% growth.

So, what will consumers be buying? According to Adobe, the hottest sellers this season will include LEGO Minifigures, Kanoodle 3D, Barbie the Movie products, PlayStation 5, Xbox Series X, Madden NFL 24, iPhone 15 models, and Birkenstock Bostons.

Discounts for toys are expected to peak at 35% off listed prices, slightly higher than last year’s peak discounts of 34%. Other categories with significant discounts include electronics (up to 30%), apparel (up to 25%), sporting goods (up to 24%), TVs (up to 22%), and furniture and bedding (up to 11%). All of these discounts are deeper than those offered last year.

In a departure from past years, Adobe predicts that discounts will arrive earlier this year, with discounts of up to 18% starting as early as next week during Amazon’s second Prime Day event.

Another trend that has emerged is the increasing popularity of Buy Now, Pay Later options such as Affirm and PayPal. These alternatives to credit cards are expected to drive a record $17 billion in online spending this holiday season, a 17% increase from 2022.

Additionally, Americans are increasingly shopping on their smartphones and tablets, with over half (51.2%) of all online spending projected to take place on mobile devices. This could mark the first time mobile surpasses desktop in terms of online shopping activity.

It’s important to note that shopping figures, including the Adobe report and government retail sales figures, are not adjusted for inflation. Rising prices can skew shopping figures when they’re not adjusted, as seen in the recent Commerce Department report on retail sales. Although retail sales rose by 0.6% between July and August, when accounting for a 0.5% increase in consumer prices, real (inflation-adjusted) retail sales only grew by 0.1%.

However, unlike the rest of the economy where prices have been rising rapidly, online prices have been consistently falling over the past year. In fact, last month marked the biggest annual drop in online prices in three years, according to Adobe. This indicates that Adobe’s forecast of solid sales growth for the 2023 holiday season will likely reflect a genuine increase in consumer demand.

In conclusion, online shoppers can look forward to enticing discounts this holiday season, with retailers offering record-setting deals to entice consumers. Despite concerns about inflation and the economy, consumers are expected to spend aggressively, especially in popular categories such as toys, electronics, and apparel. With the increasing popularity of Buy Now, Pay Later options and the growing dominance of mobile shopping, this holiday season promises to be an exciting and busy time for online retailers and consumers alike.

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