US Holiday Shopping Starts Strong With Record Online Sales
Black Friday and Cyber Monday data reveal resilient consumer spending, though a surge in 'buy now, pay later' services points to a budget-conscious shopper.
The U.S. holiday shopping season kicked off with a record-shattering burst of online activity, as resilient consumers took advantage of steep discounts and flexible payment options, providing an early sign of economic strength heading into the end of the year.
American shoppers spent a landmark $38 billion online during the five-day stretch from Thanksgiving through Cyber Monday, an increase of 7.8% from the previous year, according to data from Adobe Analytics. The period was capped by Cyber Monday, which became the single biggest e-commerce day in U.S. history with $12.4 billion in sales, a 9.6% jump year-over-year.
The robust digital numbers suggest that despite persistent inflation and higher interest rates, the American consumer remains willing to spend. Black Friday also saw a significant digital push, with online sales reaching $9.8 billion, up 7.5% from 2022, Adobe reported.
While e-commerce drove the bulk of the growth, overall retail activity also saw a modest increase. Total retail sales, excluding the automotive sector, rose 2.5% on Black Friday compared to last year, according to Mastercard SpendingPulse, which measures both online and in-store transactions across all payment types. The Mastercard data highlighted the widening gap between shopping channels, with e-commerce sales climbing 8.5% while in-store traffic saw a much more subdued 1.1% increase.
Beneath the headline figures, however, is a more nuanced picture of a calculated and budget-conscious consumer. A key driver of the record spending was the surging popularity of 'Buy Now, Pay Later' (BNPL) services. On Cyber Monday alone, these flexible payment plans accounted for $940 million in online spending, a staggering 42.5% increase from the prior year, indicating that shoppers are actively seeking ways to manage holiday expenses over time.
"The American consumer has been resilient, but they are being strategic with their dollars," noted Michelle Meyer, Chief Economist for the Mastercard Economics Institute. Heavy promotional activity from retailers, with discounts peaking on popular items like electronics and toys, was critical in persuading shoppers to open their wallets.
The strong start to the holiday season offers a dose of optimism for the U.S. economy, as robust consumer spending is a primary driver of Gross Domestic Product (GDP). The figures may ease concerns that the Federal Reserve's aggressive rate-hiking cycle would trigger a sharp pullback in consumption.
Investors and economists will now watch closely to see if this early momentum can be sustained through December. While the record-breaking Cyber Week provides a strong foundation, the full-season results will offer a more complete verdict on the health of the consumer and the profitability of a retail sector that has relied heavily on discounts to drive traffic.