New data on U.S. commerce from Adobe sheds light on the specific factors leading to its resilient performance.
Based on Adobe Analytics data, the new study analyzes transactions online, covering over one trillion visits to U.S. retail sites, 100 million SKUs and 18 product categories. Adobe finds that in 2022, consumers spent over $126 billion online on home furnishings, a 10.2% increase year-over-year (YoY); as well as $86.8 billion online on groceries, a 10.8% increase YoY.
This strong growth contrasts with electronics, which remains the top category by total spending ($202 billion), but grew more modestly at 4% YoY. Similarly, though apparel was another major online category and drove $171.8 billion in 2022 spending, that total actually fell by 3.8% YoY.
These trends have persisted recently. In February 2023, the online home furnishings category grew 12.9% YoY, driving $9.4 billion in spending for the month. Groceries grew even more substantially at 26.7% YoY, driving $8.4 billion in online spending.
Meanwhile, online demand for electronics slowed following a record holiday shopping season, falling 5.4% YoY to $13.6 billion; while apparel fell 0.6% YoY, driving $11.3 billion in February spending.
“E-commerce demand has remained resilient in an uncertain economic environment, driven in part by lasting pandemic habits where consumers had no choice but to leverage online food and home furnishing shopping services,” said Vivek Pandya, lead analyst, Adobe Digital Insights. “Now consumers have embraced the rich e-commerce experiences that made them feel comfortable getting these necessities delivered to their doorsteps, making these categories new growth drivers in the Digital Economy.”
Buy Now Pay Later continues to grow
Adobe analysis also indicates that in 2022, the share of online purchases using buy now pay later (BNPL) services grew by 14% YoY, with revenue from BNPL growing 27% YoY. In the first two months of 2023, BNPL order share was up by 10% YoY, though revenue fell by 19% YoY,. Adobe say this indicates that consumers are using this payment method for smaller purchases.
To understand the types of goods online shoppers want to delay payment for, Adobe also looked at BNPL usage across major categories including groceries, home furnishings, apparel, and electronics. In the first two months of 2023, groceries’ share of BNPL orders grew 40%, while home furnishings grew by 38%.
By contrast, apparel only grew by 8%, and electronics fell by 14%.
[Read more: The top reasons shoppers use buy now, pay later are…]
Additional insights from Adobe Analytics
- The majority of sales (51%) during Cyber Week 2022 came through smartphones for the first time. In 2022, smartphones drove 45% of overall online sales, but on the current growth trajectory, Adobe expects that every month will see smartphones drive the majority (over 50%) of online sales by December 2023.
- Larger retailers (over $1 billion in annual sales) are seeing more success with mobile shopping, driving 38% more visits that result in purchases compared with smaller retailers (between $10 million to $50 million in annual sales). The share of revenue from sales through smartphones is also 8.6% lower for smaller retailers.
- In 2021, 23% of online orders leveraged the curbside pickup option (for retailers who offered the service); This fell to 19% in 2022, and in the first two months of 2023, this fell further to 17%. Consumers tend to leverage the service more for groceries, according to Adobe, as grocery saw its share of curbside pickup orders grow 8% YoY in early 2023.
[Read more: Adobe: Toys, Cyber Week, discounts helped drive record online holiday sales]
Adobe Analytics is part of Adobe Experience Cloud.