Analysts have recently forecasted that Cyber Monday spending may slow down this year, as American consumers are seemingly less interested in the amount of fewer discounts and low inventory retailers offer. Currently, retailers in the United States are estimated to hit $10.2 billion to $11.3 billion in online sales for this year’s Cyber Monday. Last year, Cyber Monday sales hit about $10.8 billion, which was a 15% surge in sales from 2019. This years anticipated sales, therefore, signals that the sales will likely stay the same from a year ago, signaling no growth.
This lack of growth can likely be explained by many factors. Many United States retailers currently lack the inventory that is normal to have during mass sales towards the end of the year. The COVID-19 pandemic has caused massive global supply chain bottlenecks and problems, which has hindered many businesses and disallowed them to really build up their inventory. As a result, many companies have less stock, which in turn can also lead to fewer discounts being offered to consumers.
On average, discount rates offered during Cyber Monday were lower by about 8% this year, when compared to last year’s rates. Consumers are seeing less deals, and therefore not spending money during these big holiday sale events. Consumer spending also decreased for Black Friday this year, especially online sales offered during Black Friday.
Many consumers have started to shop for the holidays earlier this year, which has also impacted how consumers spend money during Black Friday and Cyber Monday. Because consumers have been worried about the global supply chains keeping them from purchasing the exact items they want, they’ve started buying for the holidays much earlier than expected. As a result, retailers have had to spread out certain promotional deals across the past few months and weeks, which has also helped these companies manage their inventories and keep supply chain costs from surging.
Overall excitement for Cyber Monday has also slowed down a bit on social media. While many consumers still anticipate this huge day of sales — and while retailers obviously still have a lot of sales — the overall buzz for this day has been dampened a bit this year.
Cyber Monday and Black Friday both occurred this year right as the news of the new Omicron coronavirus variant spread around the world. While this may have affected consumers in some way, there has yet to be any data to clarify this. Consumers may have grown concerned upon hearing this news and elected to not spend as much on sales this year. Likely, the lack of sales and low inventory offered is what is mainly keeping consumers from becoming excited about the Cyber Monday sales.
While Black Friday and Cyber Monday may not experience any growth this year, economists still believe that fourth quarter spending will surge as people continue to buy for the holiday season. As many consumers have already started to buy gifts and items for the holidays, many retailers have already seen a surge in sales and anticipate that sales will continue to increase until the end of the year.