The 2020 election is understandably expected to distract American consumers from holiday shopping this week—much as it does every election year—as they pause to see whether Donald Trump can repeat his surprise 2016 victory.
Adobe, which is forecasting a banner holiday season overall, said online sales will take a temporary hit, dropping $300 million on Nov. 4, or 13% compared to the week of Nov. 1-7, which is expected to bring in $16.3 billion in holiday sales.
This aligns with previous years when online sales dropped until the outcome of an election was known. Ecommerce was down 14%—or nearly $160 million—the day after the 2016 election, for example. And online sales dropped 6% the day after the 2018 mid-terms, per Adobe’s figures.
Generally speaking, Jason Woosley, vice president of commerce product and platform at Adobe, said there’s “almost a collective national sigh” after an election, and then holiday shopping picks back up again.
But this is no typical year, right?
And in the wake of a particularly divisive election, the question remains how long this distraction will last—and, for brands and retailers, what impact it will have on the holiday season. That’s especially true after analysts repeatedly said consumer distractions like the election hurt Prime Day 2020.
Pointing to pre-Election Day chatter about a contested result that could potentially replay the 2000 matchup between George Bush and Al Gore, which took more than a month to decide, Gartner director analyst Claire Tassin noted that any prolonged uncertainty would be a continued distraction for consumers—and likely impact holiday spend.
“If we don’t get that closure in the normal window that Americans expect, then there could very well be a continued decrease [in spend],” Woosley added. “I think we’d call that out as a potential area for softness if there’s uncertainty that sustains itself for longer than the traditional one or two days.”
That’s because consumers want certainty about the future. And when it seems unpredictable, they have a tendency to cut back on spending and increase their savings. (Adobe said it’s hard to quantify the actual amount, however.)
And this election in particular is noteworthy for multiple reasons. For one, it is reportedly expected to generate the highest voter turnout since 1908 when William Howard Taft defeated William Jennings Bryan. For another, emotions are high as an August study from Pew Research found that 83% of registered voters say it really matters who wins the presidency this year—the highest since 2000—and the American Psychological Association found that 68% of U.S. adults said the 2020 election is “a significant source of stress in their life.”
Research also shows the outcome could further impact consumer behavior, according to an Adobe survey in which 26% of consumers said the outcome will impact their holiday spend. And, in its own survey, Shopkick found that 32% of consumers feel the same way.
An election does indeed influence consumer confidence for better or worse.
“A change in administration means that there will be a change in policy, which will impact people’s lives,” Tassin said. “So if you’re having a good time right now, that might ding your confidence. And if you’re having a bad time right now, that might boost your confidence. So that’s also going to have an impact on the sentiment that people are approaching with this holiday season.”
Dave Nielsen, president of retail at Overstock.com, agreed.