Data from Adobe Analytics revealed that online sales on Black Friday reached $9.8 billion, marking an increase of about 7.5% compared to the previous year, according to Bloomberg. This trend indicates encouraging signs of consumer spending despite dismal sales forecasts for the holiday season. Nevertheless, data showed consumers were putting more purchases on flexible payments.
Consumers were gobbling up electronics, smartwatches, TVs, and audio equipment last Friday, with sales of those electronics up 7.5% compared with the previous year. Data showed consumers were increasingly resorting to buy-now, pay-later options, which jumped 72% compared to the week before Thanksgiving.
The buy-now, pay-later option is surging because consumers are balancing other debt, such as student loans or credit cards, amid the highest interest rates in a generation. These short-term loans allow consumers to make installment payments over a few months.
According to the Federal Reserve Bank of New York, younger consumers struggling with access to credit cards are frequently turning to buy-now, pay-later options.
And none of this should come as a surprise to readers, as we pointed out in a recent note titled “Dear Santa, Can I Pay Later This Year?”
Like many retailers, Best Buy warned in the weeks ahead of Black Friday that consumer demand is ‘unpredictable and inconsistent.’ Retailers have been rolling out higher discounts in response to the increase in deal-hunting consumers.
In a separate report, Salesforce said online sales on Black Friday increased by 9% versus the same day last year. Sales data showed consumers mainly purchased footwear, sporting goods, health, and beauty.
Online sales data ahead of Cyber Monday (today) can give company executives an early indication of sales performance through the Christmas shopping season.
Some estimates suggest that Cyber Monday sales might see a 21% increase to $13.7 billion, potentially exceeding Black Friday spending. This trend could imply that a larger number of holiday shoppers are completing their purchases sooner this year.
This month, we pointed out the number of times execs in earnings calls for the third quarter used “choiceful” soared to a record. The word was used to describe ‘thrifty’ consumers.
For the cash market today, Bloomberg said to watch these consumer stocks: Amazon, eBay, VF Corp, TJX, Nike, Coach owner Tapestry and Lululemon, following the Adobe data.
Deal-hunting consumers search for stores with the highest discounts. Also, an increasing number of them are opting for buy-now, pay-later.
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