Online holiday spending growth Adobe report

Online holiday spending in the U.S. is expected to jump 5.3% year over year to $253.4 billion as consumers seek discounts and even enlist the help of artificial intelligence-powered chatbots, according to an Adobe Analytics report released Monday.

Yet that growth would still be slower than the year-ago holiday season, when online sales rose 8.7% from Nov. 1 to Dec. 31, the company said. Adobe’s data tracks more than 1 trillion visits to U.S. retail websites, 100 million unique items and 18 different product categories.

That growth is also below the 10-year average of roughly 13% annually. That mark was partially skewed by the 32% year-over-year growth in 2020 when consumers leaned on retailers’ online options during the Covid pandemic.

Customers’ desire to celebrate the season with decor and gifts — and to take advantage of lower prices during a promotional time — will prop up spending even at an uncertain time for the U.S. economy, said Vivek Pandya, Adobe’s director of digital insights.

“The holiday season is one of the areas where they do feel much more of an onus and a drive to get the goods they need,” he said. “We’re seeing them willing to spend and capitalize on these sales moments.”

Plus, he said consumers have embraced the habit of stockpiling goods if they feel prices may be volatile, which could help to stabilize spending.

He said while holiday spending is expected to slow from last year, “given everything that the consumer is dealing with, it’s still pronounced growth.”

Higher online spending may not necessarily translate to a boost in overall holiday sales. Adobe’s data tracks only e-commerce, and the company estimates about 1 in 4 dollars of holiday sales will be spent online, Pandya said.

Retail sales in the U.S. have chugged along this year, but concerns about higher prices from tariffs and dipping consumer confidence have complicated the outlook for the critical shopping season. Some holiday forecasts, which capture both in-store and online spending, have predicted more modest growth than in recent years or even a decline.

Holiday spending across stores and online is expected to grow 4% year over year – a decline from the 10-year average of 5.2% growth, according to consulting firm Bain & Co.’s projections.

Consumers said they plan to spend about 5% less – or an average of $1,552 – on holiday gifts, travel and entertainment, compared with the year-ago season, according to a survey by consulting firm PwC, which included a representative sample of 4,000 U.S. consumers and was conducted in late June and early July. That projected spending, in particular, was dragged down by members of Gen Z saying that they planned to spend 23% less than the year-ago holiday season, according to PwC’s survey.

Adobe expects the peak of holiday spending during Cyber Week, which stretches from Thanksgiving through the Monday after Christmas that’s dubbed Cyber Monday. That five-day period is expected to…