Inflation means US deal-hunters on track to spend $12bn in Cyber Monday shopping spree
Business
Retailers offered massive discounts to boost sales by attracting customers
NEW YORK (Reuters) – Spending online on Cyber Monday is on track to reach a record $12.4 billion, according to preliminary estimates from Adobe Digital Insights, as bargain hunters turned out in force to snag deals on items from Barbie dolls and Lego sets to headphones and smart watches.
The estimate from Adobe Analytics, which does not account for inflation, predicts an increase of more than 9 per cent from the $11.3 billion that shoppers spent during Cyber Monday last year.
Retailers have been coaxing inflation-weary US shoppers to open their wallets on Cyber Monday with push notifications, text messages and video streaming ads touting heavily discounted cosmetics, electronics, toys, clothing and other products.
The push seems to have worked with US shoppers spending $8.3 billion online as of 6 pm EST (2300 GMT), according to Adobe Analytics, which tracks data through Adobe's Experience Cloud service for e-commerce platforms. Last-minute shoppers on Monday could spend $4 billion between 6 pm and 11 pm EST alone, it said.
"Whether the consumer is going to continue at this pace or not, we'll continue to see them spend. I think this is going to be a much better-than-advertised Christmas," said Nancy Tengler, CEO of Laffer Tengler Investments in Scottsdale, Arizona.
Shoppers have been hunting for deals since 12 am on Monday with transactions during the first 12 hours of the day exceeding those during the same time frame in 2022, according to data firm Criteo, which tracks sales from more than 700 brands and retailers in the United States made on all devices.
"Consumers are quite resilient and have found ways to buy presents and experiences for their kids and their pets," said Matthew Katz, Managing Partner at consulting firm SSA & Company.
Still, Walmart, Target, and Home Depot are among firms to raise caution on the strength of the consumer, citing higher interest rates and depleting household savings.
Charles Sizemore, chief investment officer at Sizemore Capital Management, said he expects retailers to have to discount more in the weeks ahead.
This makes him worried about profit margins at a time input and labour costs have not come down and shoppers continue to be picky. "I really think margins are going to be depressed," during the holiday season, said Sizemore, whose firm holds about $2 million of shares each in Walmart and Target.
Amazon began marketing Cyber Monday Deals as early as Saturday, including discounts of up to 46pc on some Instant Pot kitchen appliances, 37pc off certain Vitamix blenders, and 35pc on Amazon devices including a 55-inch Amazon Fire TV.
Walmart, eager to capture market share, slashed prices on Sunday night, joining the trend of retailers' early discounts on major shopping days. On Monday, Walmart stepped up discounts on some clothing to 60pc, up from the 50pc it offered on Black Friday.
