The most comprehensive analysis of the U.S. year-end peak season e-commerce market! A must-read for sellers preparing for 2022

Adobe released its 2021 year-end peak season U.S. Digital Economy Index analysis, which covered more than 1 trillion visits to U.S. e-commerce sites, 100 million SKUs, and 18 product categories.

U.S. Consumers' Holiday Online Shopping Spending

U.S. consumers spent a total of $204.5 billion during the 2021 peak season, up 8.6% year-over-year. During the holiday season, there were 38 days with record daily online shopping spending, averaging more than $3 billion, compared to 25 days in 2020.

This year, consumers started holiday shopping earlier and spread out their shopping time. Online shopping spending increased 19.2% year-on-year in the weeks before Thanksgiving (November 1 to November 24), but fell 1.4% year-on-year during Cyber ​​Week (the five days between Thanksgiving and Cyber ​​Monday). The following weeks (November 30 to December 31) increased 5.6% year-on-year.

Online shopping discounts during the US holiday season

Retailers are facing ongoing supply chain challenges, dealing with port congestion, cargo delays and overseas manufacturing disruptions. During the holiday season, there were more than 6 billion out-of-stock notices in the U.S. e-commerce market, an increase of 253% from the 2019 holiday season and a year-on-year increase of 10%.

Due to stock-outs, some categories had weaker discounts throughout the season: in electronics, discount levels were -8%, compared to -21% in 2020; computers were -10% (-22% in 2020); appliances were -4% (compared to -14%); sporting goods were -6% (compared to -14%); furniture/bedding were -2% (compared to -4%); and discounts were relatively large in apparel (-13% vs. -11%) and toys (-19% vs. -14%).

US Holiday Season Category Sales

Category Growth: This holiday season, categories such as toys (online sales increased 5.4 times compared to pre-season levels in September 2021), video games (4.5 times), and gift cards (3.6 times) saw the largest sales growth.

Other categories include groceries (2.7 times more, driven by holiday meals), jewelry (2.2 times more), electronics (2.2 times more), baby/toddler products (2.1 times more), and appliances (2 times more).

Major purchasing channels during the US holiday season

During the holiday season, 43% of online sales came from smartphones, totaling $88 billion in revenue. This is a slight increase from 2020 (40%), and consumers still use desktops and laptops as the primary devices for online shopping.

Notably, there were 6 days when more than 50% of sales came from smartphones: 11/25 (Thanksgiving), 12/18 (Super Saturday), 12/19, 12/24 (Christmas Eve), 12/25 (Christmas), and 12/26. In 2020, only one day (Christmas) exceeded 50%.

The main payment methods during the US holiday season

Buy Now Pay Later (BNPL) achieved double-digit growth in the quarter, with revenue up 27% year-over-year and orders up 10% year-over-year. On average, online shoppers spent $224 per order using BNPL, with about three items in their carts. However, growth has slowed, indicating the challenges of gaining mass adoption.

Main delivery methods for the US holiday season

Curbside/in-store pickup (BOPIS) accounted for 23% of all online orders this season. Despite weak growth, demand for curbside service remains persistent, with usage peaking at 40% the day before Christmas Eve (December 23).

On average, the average order value for curbside pickup is $91, with about 2 items in each shopping cart using the service.

Price increases by category during the U.S. holiday season

Online prices rose 3.1% year-on-year (YoY) and 0.8% month-on-month (M/M) in December 2021. Meanwhile, online consumer spending for the full year 2021 reached a record $855 billion, up 9% year-on-year, demonstrating the overall strength of the digital economy.

December's price increase marked the 19th consecutive month of year-over-year price increases online and follows the previous all-time high set in November 2021, when online prices rose 3.5% year-over-year. Groceries and apparel were the standout categories in December, with groceries seeing their highest annual price increase in more than a year (4.9% year-over-year, 0.7% month-over-month) and apparel up 16.6% year-over-year (up 0.6% month-over-month).

In December 2021, prices rose year-over-year in 12 of the 18 categories tracked by the DPI, with apparel rising faster than any other category, and prices fell in six categories: electronics, office supplies, jewelry, books, toys, and computers.

On a month-on-month basis, prices of 13 out of 18 categories increased in December, while prices of five categories, including toys, pet supplies, home/garden, computers, and flowers/related gifts, decreased.

Categories worth noting

Groceries: Prices rose 4.9% year-over-year (up 0.7% month-over-month), the largest annual increase since October 2020, for an index that reflects prices consumers pay in physical stores.

Apparel: Prices increased 16.6% year-over-year (+0.6% month-over-month), marking the ninth consecutive month of online price increases in a category that typically sees a period of sustained deflation when seasonal discounting begins.

Home Appliances: Prices rose 4.1% year-over-year (3.0% month-over-month), marking the 20th consecutive month of inflation in this category, with prices in December 2021 rising 3.3% year-over-year and 0.8% month-over-month.

Tools & Home Improvement: Prices increased 7.1% year-over-year (an all-time high for the category) and 1.0% month-over-month, marking the 13th consecutive month of online inflation as consumers continue to spend more in the category.

Electronics: Prices fell 2.6% year over year (up 0.4% month over month). This is a larger drop than in November 2021 and is almost in inflation territory for the first time since Adobe began tracking price trends in 2014.

Challenges and opportunities in 2022

This year will continue to be challenging as the COVID-19 pandemic once again brings a lot of uncertainty into 2022. From the outbreak impacting manufacturing, further expanding supply chain challenges, and other major changes to Apple's latest push for more privacy and digital marketing, there will be a lot of headaches and new problems to overcome.

However, logistics operators including the U.S. Postal Service proved to have a much smoother peak shipping season in 2021, so the shipping industry is in much better shape now. Social commerce will become one of the most lucrative opportunities in the e-commerce market in 2022. But there may be other opportunities, such as finding the right trends, products or product categories to grow an online business.

The key for sellers is not to become complacent and always look for new directions. E-commerce is an ever-evolving and changing business that requires flexibility and a lot of problem-solving skills to increase sales and repurchase rates.

Editor ✎ Xiao Zhu/

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