Holiday Online Retail Sales Projected to Rise 10% in 2021. Prices Will Climb, Too.

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Online U.S. holiday retail shopping will grow 10% in 2021 to $207 billion after soaring 33% a year ago during the worst of the pandemic, a new study predicts.

Published this morning by

Adobe
,
the study is based on a combination of more than 1 trillion visits to U.S. retail sites that run the company’s e-commerce software, and a survey of more than 1,000 U.S. consumers. 

It underscores that online retailing continues to make gains despite the reopening of physical stores this year as the Covid-19 pandemic eases. Adobe says 2021 online holiday shopping growth could range between 5% and 15%, depending on trends in Covid-19 cases and related store shutdowns as well as macroeconomic factors.

Adobe also sees inflation crimping consumer buying power this year. The study projects that consumers will pay 9% more during the Cyber Week period on average for comparable goods than a year ago. Adobe notes that online prices on average have increased for 16 consecutive months. 

This year’s shopping season–the period from Nov. 1 through Dec. 31–will be spread out more evenly than in past years, the study finds. Adobe sees sales on Cyber Monday (the Monday after Thanksgiving weekend) of $11.3 billion, up 4% from a year ago. It forecasts Black Friday sales (the Friday after Thanksgiving) of $9.5 billion, up 5%, and sales on Thanksgiving Day itself of $5.4 billion, up 6%.

Adobe expects consumers to see a “plague” of out-of-stock messages this year, as many retailers struggle with ongoing supply chain constraints. Adobe reports that out-of-stock messages are up 172% this year from the prepandemic period.

There may be less discounting this year. Adobe forecasts discounts will range from 5% to 25%, down from a historic range of 10% to 30%. It sees the biggest discounts in the PC and electronics categories, with the smallest discounts in furniture and tools.

Adobe also took a look at global retailing during the holiday season and predicts it will increase 11% to $910 billion.

And the company made some predictions on this year’s most popular gifts:

• Toys: Tamagotchi Pix, Pop Fidget, Got2Glow Fairy Finder, Baby Yoda, Gabby’s Dollhouse

• Gaming Hardware: Nintendo Switch OLED, PlayStation 5, Xbox Series S/X, Stream Deck from Elgato 

• Gaming Software: Metroid Dread, Battlefield 2042, Pokémon Brilliant Diamond & Shining Pearl, Halo Infinite, FIFA 22

• Others: Apple AirPods Max, smart mugs, Instant Pot air fryers, smart water bottles, drones, record players

Write to Eric J. Savitz at eric.savitz@barrons.com