With an Earlier Start, Holiday E-commerce Transactions Are Projected to Outperform 2020

E-commerce merchants can expect another strong holiday-shopping season this year as online transactions are projected to outpace those in the same period last year, according to ACI Worldwide Inc.

In the United States, the biggest surge in volume is expected between Thanksgiving and Cyber Monday, with e-commerce sales projected to grow 23%, compared to the same period in 2020, ACI says. 

Globally, e-commerce transactions for the entire holiday season, which spans October through December 2021, are projected to rise 14%. Industries projected to experience the greatest year-over-year increases in transactions are ticketing, which is expected to grow more than four-fold, travel, which is expected to more than double, telco (11%), and gaming (7%). 

While e-commerce transactions for the traditional holiday-shopping period are projected to be stronger than during the 2020 season, data from ACI indicates that consumers started their holiday shopping earlier this year, with global e-commerce transactions in September increasing 6% over the same period in 2020. 

Helping drive the increase in September was that merchants offered deals and discounts earlier than in previous years to promote early shopping, giving them greater flexibility to accommodate any supply-chain challenges, ACI says.

“The holiday-shopping season started in September this year with consumers looking for gifts and bargains early,” Debbie Guerra, head of merchant payments at ACI, says in a prepared statement. 

The earlier start to the 2021 holiday shopping season is good news for U.S. e-commerce merchants, which experienced the slowest rate of increase in sales during the second quarter of this year since the first quarter of 2018.

Other areas of commerce likely to show strong growth include buy online, pick up in-store transactions, which are expected to grow 98% during the holiday season period compared to a year ago.

When it comes to popular payment methods, buy now, pay later remains a favored option for consumers. BNPL transactions more than quadrupled during the first half of 2021, compared to the same period a year earlier, according to ACI. BNPL also has the highest acceptance rates (98% on average compared to 96% on credit/debit cards), indicating a continued upward trajectory.

“The surge in online purchases of higher-value items, such as home electronics, has, in part, driven the substantial increase in popularity of BNPL,” says Guerra. “Merchants offering this payment method have a real opportunity to attract new customers and improve the experience of existing ones. This holiday season could be a game-changer for merchants offering BNPL options for consumers.”