Get ready, because the 2024 Christmas shopping season will be short and competitive, with mobile devices, elections, email and social commerce taking center stage.
Below are five holiday shopping predictions, input from the AI, and a report card of my predictions from last year.
54% on mobile
According to Adobe, just over half of all U.S. online purchases will be made on a mobile device between November 1 and December 25, 2023, amounting to approximately $113.5 billion. This year, 54% of holiday e-commerce sales will come from mobile.
There are three factors driving growth: age, market and postpaid options.
First, there’s the age factor: According to Emarketer, Gen Z shoppers (ages 18-25) are more likely to purchase from a mobile device, with roughly 15% of Gen Z consumers making a purchase directly from a social media site. And because social commerce is mobile-friendly, its impact is multiplied.
Second, Amazon and other large marketplaces accounted for more than half of all sales last holiday season, and these marketplaces offer native mobile apps that make it easy to shop from your smartphone.
Third, BNPL is becoming increasingly popular for Christmas shopping. It often works with larger retailers and marketplaces, which may offer a better mobile shopping experience.
E-commerce increased by 5%
Early forecasts from Emarketer, an e-commerce platform maker, and others had predicted that the 2024 Christmas shopping season would grow to $271 billion, up 23% from 2023’s $222.1 billion.
That’s overly optimistic, given the fierce US election, inflation and other economic issues. I’m predicting a 5% increase this year.
25% increase in email volume
2024 will see continued growth in email marketing.
For example, Sinch Mailgun, a provider of email infrastructure services, reported last year that email volume for the weekend between Black Friday and Cyber Monday increased 16% year-over-year. For the month of November as a whole, volume increased 22% year-over-year.
The 2024 Christmas shopping season is relatively short at just 29 days, which means digital advertising is likely to be more competitive and expensive, and marketers will turn to email to drive sales.
40% of Gen Z uses social media
A recent survey of Gen Z shoppers found that roughly 4 in 10 will use some form of social commerce during the 2024 Christmas shopping season.
TikTok Shop, launched in September, generated $11.9 billion in total volume in 2023. TikTok doesn’t typically release its performance results, but it’s reasonable to assume growth, and when you add in the rise of other platforms, social commerce in 2024 could be significant.
BNPL 9% of retail sales
For the second year in a row, BNPL is expected to account for 9% of all U.S. online holiday sales.
I overestimated BNPL growth last year, putting it at 7.4%, but a recent Experian survey found that roughly 25% of US consumers plan to use BNPL this year, so I project growth to be 9% in 2024.
Additionally, the mix of brick-and-mortar and e-commerce sales is set to plateau. In 2023, e-commerce will account for 34% of U.S. holiday sales, up one percentage point from the previous year. Brick-and-mortar and online retailers will find more ways to drive in-store shopping. One way to do this is by promoting BNPL offers in-store.
AI Prediction
After creating a list of five 2024 holiday predictions, we had three generative artificial intelligence tools do the same, using the following prompt:
“Based on historical data and recent forecasts, we challenge retail and e-commerce professionals to make five bold predictions for the 2024 holiday shopping season.”
ChatGPT 4.o (by Open AI)
ChatGPT 4 by OpenAI
Social commerce is expected to account for approximately 20% of online transactions during the holiday season. Sustainability will be a key factor for consumers during the 2024 holiday season. Retailers offering carbon-neutral shipping, recyclable packaging, and sustainably sourced products are expected to see a 25% increase in sales. Omnichannel fulfillment will become mainstream, with same-day delivery becoming the norm. Mobile shopping will surpass desktop and in-store experiences, with over 70% of e-commerce transactions occurring on smartphones during the holiday season. Grok-2 Beta (by X)
Grok-2 Beta (Made by X)
Mobile commerce goes mainstream. Over 60% of all e-commerce transactions during the holiday season will take place on a mobile device, driven by enhanced mobile payment solutions and an increase in mobile-first consumer behavior. Social commerce expands. Retailers that integrate seamless in-app purchasing experiences will see up to 30% increased sales directly through social media. Although the holiday season will be structurally shorter, the intensity of shopping activity will increase earlier and more sharply. Retailers will launch holiday promotions as early as late October, with an emphasis on pre-Black Friday sales. AI personalization and predictive shopping will blossom. Retailers will use AI not only to suggest products, but also to predict what consumers want before they explicitly search for them, potentially boosting conversion rates by offering personalized “surprise and delight” deals. This could lead to AI influencing over 25% of online purchases during the holiday season. As awareness of environmental issues increases, sustainability will become a key factor in purchasing decisions. Gemini (Courtesy of Google)
Google’s Gemini
Mobile devices will account for more than 60% of all online holiday shopping traffic and nearly 50% of all online sales. AI-powered personalization will become mainstream, with retailers using customer data and predictive analytics to create targeted product recommendations, offers, and experiences. Social media platforms will be major players in the holiday shopping space. Sustainability will drive purchasing decisions. Consumer awareness of environmental and social issues will reach new heights, leading shoppers to choose brands and products that align with their values. Supply chain disruptions will continue. Despite efforts to mitigate disruptions, ongoing challenges such as port congestion, labor shortages, and material shortages will persist, impacting product availability and pricing.
Last year’s predictions
Since 2013, I have been predicting ecommerce trends and sales for the upcoming holiday season. Here are my predictions for 2023.
Holiday spending will grow less than 5% — That’s correct. The National Retail Federation projects total holiday sales growth of 3.8% in 2023. Emarketer predicted 2023 holiday growth of 3.9%, but others predicted a higher rate of 4.9%, below the 5% forecast. By comparison, 2022 U.S. holiday spending increased 8.1% year over year.
Pay later accounts for 9% of retail sales, but that’s a mistake: According to Adobe Analytics, BNPL transactions grew 14% last year, but the total was just $16.6 billion, or 7.4% of sales.
Discounts drive sales — Correct. This prediction is easy, with some estimates suggesting that 60% of Christmas 2023 orders will include at least one sale item. Emarketer explains: “Deep discounts drove consumer spending across the Cyber Five in 2023.”
Shoppers wait for discounts — That’s right: Veterans Day (Nov. 11) sales in the U.S. remained roughly flat from 2022 to 2023, but Black Friday retail sales increased 7.5% year-over-year, with e-commerce up about 19%. Shoppers waited for Black Friday and Cyber Monday discounts.
Impact of generative AI on product discovery — Unknown. This prediction is hard to measure. We found no data on how generative search results affected holiday purchasing behavior.
