Although consumer spending remained steady early in the fourth quarter, new data from MasterCard and Adobe Analytics suggests the holiday season has delivered early gifts to online retailers.
This Black Friday, in-store shopping grew by 0.7% year-over-year, while online spending soared by 14.6%, according to MasterCard. Analysts from both firms found that as competition between brick-and-mortar stores and online retailers intensifies, consumers are prioritizing early deals, fueling a surge in spending compared to 2023.
Adobe reported that Black Friday spending reached a record $10.8 billion, marking a 10% increase from last year. Meanwhile, economists from MasterCard told Reuters that a surge in online spending highlights the growing trend of consumers favoring online shopping for the convenience of browsing and purchasing from home. Additionally, a Salesforce study revealed that mobile sales accounted for 69% of all purchases globally, signaling a shift toward mobile-first transactions.
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Despite strong digital sales, in-store retail showed mixed results. Pass_by’s report revealed a 1.85% year-over-year drop in foot traffic on Black Friday. However, categories such as grocery stores and jewelry experienced growth. Foot traffic at grocery stores (+2.18%) and bookstores (+2.08%) remained steady, driven by demand for essentials and affordable gifts. Jewelry stores saw a modest increase of 3.17%, fueled by demand for personalized gifts.
Conversely, apparel stores faced a decline in foot traffic, with drops ranging from 3.75% to 8%. This reflects a broader trend of consumers increasingly turning to e-commerce for clothing, as physical store apparel sales remain subdued while online sales grow.
Foot traffic at Foot Locker fell by 11%, according to Pass_by. However, Salesforce found that U.S. online sales grew by 7% to $17.5 billion on Black Friday, aligning with analysts’ expectations for consumer spending this holiday season.
A forecast from Adobe predicts the upward trend in consumer spending will continue through January as shoppers take advantage of Cyber Monday deals and last-minute promotions. As more retailers expand their digital offerings, it’s likely the shift toward online shopping will intensify, despite ongoing economic uncertainty and shifting consumer habits.
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