Online holiday spending in the US to reach $189bn this year

E-commerce sales during the Black Friday and Cyber Monday sales periods are expected to surge to $10bn

REHOBOTH BEACH, DE - NOVEMBER 27: A string of Santa Claus decorations hang from a plexiglass divider to separate a cashier and customers during Black Friday on November 27, 2020 in Rehoboth Beach, Delaware. Due to the coronavirus (COVID-19) pandemic, face masks are required on the boardwalk and strongly recommended on the beach.   Mark Makela/Getty Images/AFP
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Online holiday spending in the US is expected to grow by 33 per cent to reach $189 billion this year as consumers increasingly shop remotely due to the Covid-19 pandemic, a study by Adobe Digital Insights found.

E-commerce sales during the Black Friday to Cyber Monday period are forecast to reach $10bn, boosted by deep discounts offered by retailers.

“Normally, holidays bring a sudden jolt to e-commerce websites. This year, going into the holidays, online retailers are seeing shopping on steroids,” the Adobe report said.

Adobe based its findings on an analysis of more than 1 trillion visits to US retail websites.

This year’s sales broke the record, with e-commerce growing by 120 per cent on some days compared with last year. Shopping trends were also volatile, with some days hitting lows of 25 per cent compared with the previous year, the report said.

The closure of physical shops across the US led to the biggest spike in e-commerce activity in May.

Consumers also had disposable income due to the disbursement of stimulus cheques and unemployment benefits by the government.

The US has the highest number of Covid-19 infections worldwide and accounted for more than a fifth of the 62 million cases as of yesterday, according to Worldometer.

Analysts at Adobe expect more people to shop online if the flu season in the US leads to further restrictions .

“E-commerce is still only [about] one out of every $4 spent on retail. That is a large bucket of dollars that could move online, leading to potential for big swings this season,” the report said.

Black Friday deals are set to be extended to the end of the year, allowing retailers to enjoy a longer sales period.

A key differentiator for retailers seeking to increase their online consumer share this year will be free shipping.

Holiday shipping costs typically fall by 9.2 per cent during the peak sales period, compared with the rest of the year.

The discount largely comes from free shipping offers to lure consumers, which may be harder to come by this year.

Excluding free shipments, shipping costs rose by 1.7 per cent, Adobe said in its report.

“Based on previous years’ trends, December 11 would be the last day for cheaper shipping, with shipping costs peaking from there at 14.6 per cent higher than the rest of the holiday season,” the report said.