Adobe (ADBE) reported that consumer e-commerce spending rose 8.2% year-over-year to $88.7 billion online in the month of October. Mobile continued to drive the majority of online spend, at 51.4% share, up 11.6% year-over-year. Additionally, ‘Buy Now Pay Later’ drove $7.1 billion in spending (up 7.6%), as consumers looked for greater flexibility in managing their budgets.
Online spending spiked during the Amazon (AMZN) Prime Day event on October 7-8, where discounts happened broadly across most major U.S. retailers. Across those 2 days, consumers spent a total of $9.1 billion online, driven in part by competitive discounts that peaked at 18% off the listed price.
Notably, holiday décor was a popular purchase, with online sales rising 130%, as were items for the home—with consumers taking advantage of deals to upgrade their living spaces. Online sales rose 83% for hand tools and 62% for power tools, an indication of more DIY projects, which could bode well for Home Depot (HD) and Lowe’s (LOW). Sales of refrigerators & freezers were up by 55%, which could help Whirlpool (WHR) and Best Buy (BUY), among other appliance-related stocks. Other categories with strong growth included e-readers (up 81%), headphones & speakers (up 52%), phone accessories (up 51%), and video games (up 41%).
The fresh data from Adobe shows that generative AI traffic is not only rising but also driving higher conversion (visits that become purchases) than non-AI traffic. In October, traffic from generative AI sources spiked by 1,200% from a year ago. Once AI-driven consumers landed on a retail site, they were 16% more likely to convert, according to Adobe. Additionally, shoppers who arrive from generative AI sources are 13.6% more engaged compared to non-AI sources. This means they are exploring more content on the retail site and are less likely to leave immediately, with a notable 31% lower bounce rate.
The Adobe report is positive for many retailers, including Amazon (AMZN), eBay (EBAY), Walmart (WMT), Target (TGT), Dick’s Sporting Goods (DKS), Macy’s (M), Wayfair (W), and Etsy (ETSY). However, some analysts have warned that holiday sales may have been pulled forward into October from the traditional Black Friday to Cyber Monday buying window in late November.