Small shopping cart on top of a laptop keyboard.

The 2023 Holiday Shopping Season Recap: Top Takeaways for Ecommerce Brands

Ryan Faist

Ryan Faist, Channel Key

January 12, 2024

The 2023 holiday shopping season set a new ecommerce record. According to data from Adobe, U.S. consumers spent $222.1 billion online during November and December, a 4.9% increase from 2022.

This growth is due partly to a better-than-expected Cyber Week, which grew 7.8% YoY to reach a whopping $38 billion. Shoppers spent a total of $12.4 billion on Cyber Monday (up 9.6% YoY), slightly surpassing Adobe’s initial projection and making November 27, 2023, the biggest online shopping day in history.

The success of Cyber Week also bolstered sales in December. Adobe reports shoppers spent $98.6 billion online (up 3.7% YoY), driven in part by discounts that lingered past Cyber Monday.

Below are four additional callouts from the 2023 holiday season, based on Adobe’s analysis of over one trillion visits to U.S. retail sites, 100 million SKUs, and 18 product categories.

Discounts Reach All-Time Highs

More than half (65%) of all holiday shopping revenue was driven by five categories: electronics ($50.8 billion), apparel ($41.5 billion), furniture ($27.3 billion), groceries ($19.1 billion) and toys ($7.7 billion).

According to Adobe, these categories offered the most competitive discounts, attracting more shoppers and conversions. The following is a breakdown of the average peak discount for each category compared with the 2022 holiday season.

  • Toys: 28% (2023) vs. 34% (2022)
  • Computers: 24% (2023) vs. 20% (2022)
  • Apparel: 24% (2023) vs. 19% (2022)
  • Televisions: 23% (2023) vs. 17% (2022)
  • Furniture: 21% (2023) vs. 8% (2022)
  • Appliances: 18% (2023) vs. 16% (2022)
  • Sporting Goods: 18% (2023) vs. 10% (2022)

Shoppers Like Buy Now, Pay Later

In October, Adobe predicted Buy Now, Pay Later (BNPL) would generate $17 billion this season, a 16.9% increase over last year. The actual BNPL results reached $16.6 billion in online spending, almost hitting the forecast on the mark. This is an all-time high for BNPL, and a massive 14% YoY increase.

Not surprisingly, November was the biggest month for BNPL ($9.2 billion, up 17.5% YoY), while Cyber Monday was the biggest day ($940 million, up 42.5% YoY). Adobe attributes the popularity of BNPL to continued economic uncertainty, including the rising cost of living.

Mobile Shopping is King (Barely)

Mobile shopping finally surpassed desktop shopping this holiday season, accounting for 51.1% of all online sales. Interestingly, mobile shopping was highest on Christmas Day, driving 63% of online sales for the 24-hour period. According to Adobe, customers used their phones to take advantage of final deals or redeem gift cards while spending time with friends and family on Christmas Day.

Advertising Drives Most Online Sales

The 2023 holiday shopping season proved again that you must spend money to make money. Paid search remained the biggest driver of sales for retailers across major marketing channels, driving 29.4% of all online sales for the season. Below is a breakdown of holiday sales across other channels:

  • Direct Website Visits: 19.3%
  • Affiliates/Partners: 16.6%
  • Organic Search: 15.9%
  • Email Marketing: 15.3%
  • Social: 5%

Channel Key Takeaway

Above all, the 2023 holiday shopping season demonstrated that shoppers are motivated by deals and payment options. Combined with the increased cost of advertising, this means lower profitability for brands. Gone are the days when the holiday shopping season was a surefire path to windfall profits. However, there is a silver lining to the way holiday shopping has changed. While brands may see lower margins during November and December, they also have a powerful opportunity to reach new (potentially lifelong) customers. Instead of measuring the success of your holiday marketing performance by total sales and profitability, consider the lifetime value of the new customers you gained. Offering steep discounts with aggressive advertising may lower your margin temporarily, but it can also set your brand up for greater success in the long run.

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