US consumers go on holiday spending spree

SALT LAKE CITY — Predictions of increased spending by consumers over the 2024 winter holiday season are holding true, but the pace of that growth is exceeding expectations, according to a report released Wednesday that finds U.S. shoppers shelled out over $77 billion online in the first 24 days of November.

Web traffic experts at Adobe Analytics tabulated online sales from Nov. 1 to Nov. 24, finding spending volumes so far this season are outpacing the same period last year by 9.6%, easily outpacing Adobe's 2024 full season forecast of 8.4% year-over-year growth.

On 21 of those 24 days, consumers' total daily expenditures exceeded $3 billion, two more days of spending at that level over the same period last year, and a new record.

Many product categories are seeing double-digit growth over the period, with consumers spending the most on electronics thus far, coming in at $17.7 billion and up 11.4% over last year.

Two categories have outpaced electronics in terms of year-over-year growth including apparel, which drew $14.5 billion in spending and is up 13.4% over the same stretch and groceries accounting for $7.5 billion in sales, up 16.8% compared to the first 24 days of November 2023.

Other categories with notable annual growth, according to Adobe, include furniture/bedding at $9.5 billion, up 7.2% over last year, and cosmetics spending of $3.2 billion so far this holiday shopping season, up 10.1%.

"The holiday season is off to a strong start, and we see a consumer willing to splurge on more expensive items in categories from electronics to appliances, partly in response to persistent discounts," Vivek Pandya, Digital Insights lead analyst, said in the report. "Shoppers are also embracing new ways to shop online this season, from the rise in mobile shopping that will again eclipse desktop, to the use of generative AI-powered chatbots as a shopping assistant."

In projections released last month, Adobe Analytics estimated total online spending over the 2024 winter holiday shopping season from Nov. 1 to Dec. 31 will come in at $240.8 billion, up from 2023's $222.1 billion.

Biggest discounts yet to come

Adobe says that while consumers have already seen early deals, the biggest bargains are coming in the days ahead. For the first 24 days of the season, discounts for electronics peaked at 10.9% off listed price but are expected to hit 30% on Cyber Monday, Dec. 2.

Thanksgiving Day online shoppers will likely see the biggest discounts for toys at 27% (compared to 14.6% in the first 24 days of the season), appliances at 18% (12.9%), furniture at 19% (8.2%) and sporting goods at 20% (10.9%).

Adobe analysts predict Black Friday will mark the biggest discounts for televisions at 24% of listed prices. Saturday, Nov. 30, is expected to have the best bargains for computers at 23% markdowns, and Cyber Monday is set to have the best deals on apparel purchases with discounts rising to 23%.

AI chatbots drive meteoric sales

E-commerce referrals by AI chatbots have been ramping up quickly since the start of the year with traffic to retail sites from generative AI-powered chatbots (consumers clicking on a link to retail site) increasing by 900% from Jan. 1 to Aug. 31, 2024, compared to the same period in 2023, according to Adobe.

But that red-hot growth arc has turned molten in the first 24 days of the winter holiday season with those AI-generated referrals up a staggering 1,700% over the period.

In a September survey of 5,000 U.S. consumers, Adobe found that 7 in 10 respondents who have used generative AI for shopping believe it enhances their experience, and 2 in 5 plan to use it for the holidays. Additionally, 20% of respondents turn to generative AI to find the best deals, followed by quickly finding specific items online, 19%, and getting brand recommendations, 15%.

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