Consumers are scouring the internet for online deals as they begin to cap off the five-day post-Thanksgiving shopping bonanza with Cyber Monday.
Even though e-commerce is now part and parcel of our everyday lives and much of the holiday shopping season, Cyber Monday –- a term coined back in 2005 by the National Retail Federation –- continues to be the biggest online shopping day of the year, thanks to the deals and the hype the industry has created to fuel it.
For several major retailers, the “Cyber Monday” sale is a days-long event that begins over the weekend. Amazon’s, for example, kicked off on Saturday and runs through Monday. Target’s two-day event began overnight on Sunday, while Arkansas-based Walmart kicked off its most recent discounts Sunday evening.
Consumer spending for Cyber Week — the five major shopping days between Thanksgiving and Cyber Monday — provides a strong indication on how much shoppers are willing to spend during the holiday season.
Shoppers have been resilient this year in the face of stubbornly high inflation, which recently reached its lowest point in more than two years but remains painfully apparent in areas like auto and health insurance and some groceries, like beef and bread.
But consumers are also relying on savings to fuel their shopping and are facing more pressure from credit card debt, which has been on the rise along with delinquencies. They’ve also been embracing “Buy Now Pay Later” payment plans, which allow shoppers to make payments over time without typically charging interest — a model some analysts believe can make acquiring debt too easy.
The National Retail Federation expects shoppers will spend more this year than last year. But the pace of spending will slow, growing 3% to 4% compared to 5.4% in 2022, the nation’s largest retail trade group said earlier this month.
According to Adobe Analytics, which tracks online spending, consumers spent $76.7 billion from the beginning of November until Thanksgiving, when major retailers including Amazon, Target and Walmart were already offering online deals geared towards the holidays. On Thanksgiving Day, Adobe said shoppers dolled out $5.6 billion, up 5.5% compared to last year. That’s nearly double the amount consumers spent online in 2017, showing the continued shift to online shopping during the gift-giving season.
Retailers began offering holiday deals in October this year, continuing a trend that started during the COVID-19 pandemic and has been resurrected due to supply chain clogs or inflation woes.
Rob Garf, Vice President and General Manager of Retail at Salesforce, said some of the earlier deals retailers offered were fairly conservative. That changed on Black Friday, when the discount rate began to peak at 30% in the U.S., he said. On Thanksgiving, consumers also saw big discounts for toys, electronics and computers, according to Adobe.
“Consumers feeling economic pressure are taking control of their household finances and have been really diligent and patient,” Garf said.
“They’re once again playing a game — and winning the game — of discount chicken, where they wait for retailers to discount to where they feel most comfortable,” he said. “And that’s what’s happening.”
Garf said Salesforce’s data showed health and beauty, footwear and active apparel continued to be the hottest categories for discounts. He said consumers should expect good deals in those categories on Cyber Monday.
The resale industry, which has grown in recent years, is also expected to be a significant part of the holiday shopping season. Salesforce predicts 17% of holiday gifts this year will come from resale markets like Facebook Marketplace or ThreadUp, as well as brands like Canada Goose, Patagonia and Coach offering resale options on their sites for environmentally-conscious consumers or those who enjoy vintage offerings.
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AP reporters Anne D’Innocenzio and Chris Rugaber contributed to this report.
