The 5 Trends Defining This Holiday Shopping Season

In the midst of inflation and rising interest rates—not to mention a second Prime Day—software giant Adobe released its annual holiday forecast, which found U.S. consumers will spend slightly more online this holiday season. That’s $209.7 billion to be precise, a growth of 2.5% from 2021 when they spent $204.5 billion (although growth then was 8.6%). As consumers grapple with tighter budgets, they will find a markedly different shopping environment in several key respects, while other trends will continue their slow and steady simmer. Here’s a closer look at the five trends that will define the 2022 holiday season. Will Consumers Greet Your Ads With “Ho Ho Ho” or “Ho Hum” This Holiday Season? Inflation According to Vivek Pandya, lead analyst at Adobe, the biggest storyline in 2022 is inflation and how consumers will make the most of their budgets. “The consumer also had stimulus dollars [in 2021] and they were kind of flush with savings coming into the holiday season,” Pandya said. “This year, we've seen their savings have really taken a hit as they've had to manage gas prices and travel costs.” In fact, when gas prices surged in March and April, he noted “a massive effect on consumers’ discretionary spending,” which resulted in “a real pullback” until Amazon’s Prime Day event in July and other coinciding sales, which offered a respite and resulted in 20% year-over-year growth for the month. Big discounts The good news for shoppers is discounts, which were slim in 2021, will abound in 2022. That’s particularly true in categories like electronics, where Adobe expects to see markdowns of 27% (up from 8% in 2021), and toys, which will see discounts of 22% (up from 9%). In fact, Adobe projects record highs for discounts this season—upwards of 32%—as retailers seek to get rid of surplus items. “They're going to want to incentivize consumers to spend because the purchase intent is going to be higher than it has been relative to other parts of the year,” Panday said. “And they're well aware they're going to have to really compete on price because we're dealing with a very price-sensitive consumer. So that's going to help drive down prices.” Earlier spend When Amazon delayed Prime Day to October in 2020, Adobe data shows overall ecommerce growth for the month was up nearly 44% year-over-year (YoY)—and it did indeed entice consumers to shop earlier for holiday gifts. Amazon’s second Prime Day event, coming Oct. 11-12, is once again expected to pull holiday spend even earlier and impact Cyber Week sales. While higher discounts will come later, consumers who don’t want to worry about must-have items going out of stock can expect to see discounts as high as 15% in mid-October. Cyber what? Nevertheless, Cyber Monday is once again anticipated to be the biggest shopping day of the year with $11.2 billion spent online. That’s up 5.1% YoY. Black Friday sales, on the other hand, are projected to grow just 1% to $9 billion while Thanksgiving sales will drop 1% to $5.1 billion. While these key shopping dates are not the definitive moments they once were, consumers have been conditioned to expect the best discounts then and will therefore still spend nearly $35 billion online between Thanksgiving and Cyber Monday. “We're expecting these days to start to really see very minimal growth as a factor of the discounts being spread out pretty heavily across the season,” Pandya said. “And also just an onus on the consumers who are trying to manage that cost through the season and through multiple months versus it hitting their bank accounts all at once.” BNPL While buy now, pay later (BNPL) saw significant growth in 2021, Adobe predicts usage will decline in 2022. In the first nine months of the year, BNPL grew just 5% compared to the same period in 2021. “In this type of inflationary environment where consumers are looking to spread out cost, we are seeing utilization grow year over year, but it's a lot less than the way it was scaling when online growth was up pretty heavily overall,” Pandya said. BOPIS Curbside pickup, on the other hand, is projected to “remain widely used.” Adobe predicts it will peak from Dec. 22 to 23 at 35% of all online orders. That’s up from about 25% through November 2022. (Curbside pickup was used in 25% of all online orders in December 2021.) “That's really a factor of consumers being able to save on shipping costs and have that peace of mind that they've locked down that product and just go pick it up,” Pandya said. “So that technology and that trend has continued to see strong utilization since it started growing a couple of years ago.” 4 Ways to Simplify Shopping for Your Customers This Holiday Season

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It's Beginning to Look a Lot Like the Holiday Shopping Season Will Be Defined by 5 Trends

How will inflation and a second Prime Day impact consumer behavior?

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Lisa Lacy

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Lisa Lacy