Online Spending Could Top $124B Over The Holidays

Online Spending

Amid a change in shopping habits from brick-and-mortar to eCommerce, online spending is expected to reach $124.1 billion this holiday season — an increase of 14.8 percent. That percentage is expected to be much higher than the 2.7 percent growth forecasted for traditional stores, Reuters reported.

To arrive at the forecast, Adobe Analytics took a look at transactions at 80 of the top 100 retailers in the United States along with visits by consumers to U.S. retail websites. The company also noted that prices for sporting goods could be lower than 13 percent than their 10-month average on Thanksgiving. And it said that, on Black Friday, television prices could be 22 percent lower.

For online sales, the calendar might provide a bit of a boost: due to an extra day in the period spanning from Cyber Monday to Christmas, a $284 million rise in sales could occur.

The news comes as holiday sales for U.S. retailers are expected to increase 4.8 percent this year. The National Retail Federation (NRF) revealed in October that holiday sales growth will be higher than the average increase of 3.9 percent over the past five years. However, sales will grow at a slower pace than the 5.3 percent growth the retail market saw one year ago.

“Last year’s strong results were thanks to growing wages, stronger employment and higher confidence, complemented by anticipation of tax cuts that led consumers to spend more than expected,” NFR Chief Economist Jack Kleinhenz said, according to Reuters in October. “With this year’s forecast, we continue to see strong momentum from consumers as they do the heavy lifting in supporting our economy.”

He added that several factors played a role in the boost, including more jobs, improved wages, lower inflation and an increase in net worth. According to the NRF, sales for the last two months of the year are expected to hit between $717.45 billion and $720.89 billion, excluding autos, gasoline and dining out. Holiday sales in 2017 were $687.87 billion.



The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.