(Reuters) – Deep discounts on everything from beauty products and toys to electronics during the Thanksgiving weekend enticed U.S. shoppers to splurge about $38 billion online, signaling a strong holiday shopping season even as economic uncertainty swirled.
Online consumer spending jumped 7.8% during Cyber Week, or the five days from Thanksgiving through Cyber Monday, according to data from Adobe (NASDAQ:ADBE) Analytics, outstripping initial expectations for a 5.4% rise.
In the lead-up to the crucial shopping season, industry forecasters including Deloitte and retailers like Walmart (NYSE:WMT) and Macy’s (NYSE:M) warned of cautious consumer spending due to sticky inflation constraining budgets. But blockbuster deals across Thanksgiving Day through Cyber Monday helped spread the holiday cheer for bargain-hunters.
More than 200 million shoppers tapped into promotions both in-store and online during the Thanksgiving weekend, the National Retail Federation (NRF) said on Tuesday. That was a jump from the 196 million shoppers seen last year and trumped the trade association’s estimates of 182 million.
“Shoppers exceeded our expectations with a robust turnout. Retailers large and small were prepared to deliver safe, convenient and affordable shopping experiences with the products and services consumers needed,” NRF President and CEO Matthew Shay said.
Online shoppers rose 3.1% to 134.2 million, making up for a slight dip in the number of customers who visited brick-and-mortar stores. The weekend saw about 121.4 million in-store shoppers, down from 122.7 million in 2022, according to the retail body.
“The record online spending across Cyber Week … shows the impact that discounts can have on consumer demand, especially with quality products that drove a lot of impulse shopping,” said Vivek Pandya, lead analyst at Adobe Digital Insights.
On an average, consumers spent $321.41 on holiday-related purchases including toys, electronics and gift cards, compared with $325.44 last year, the NRF data showed.
Adobe said discounts peaked at 31% for electronics and at 27% for toys on Cyber Monday, which is typically the biggest online shopping day in the U.S.
In a bid to stretch their Christmas budgets, shoppers are also leaning on Buy Now, Pay Later (BNPL) services such as Klarna or Affirm to avoid the extra fees and interest that come with credit card payments.
A record $940 million worth of purchases were made through BNPL on Cyber Monday, surging 42.5% from last year and trouncing Adobe’s earlier estimate for an 18.8% jump.
Payments firm Block also noted BNPL transactions through Afterpay surged 19% over the weekend, while Klarna said it saw a 29% increase in orders placed by U.S. shoppers on Black Friday.
