2024 Holiday Retail Recap: Unwrapping the Results of the Season

Holiday season sales beat expectations

Declining inflation, increased spend, and improved consumer optimism set the stage for a record holiday shopping season. While Deloitte forecasted an annual total sales increase of 2.3% to 3.3% year over year (YoY) during the holidays, the observed growth beat expectations with total retail sales increasing 3.8% to 4.0%.

For online sales specifically, Deloitte forecasted a 7.0% to 9.0% increase YoY, and the observed growth was right in line at 6.7% to 8.7%.

In-store shopping made a comeback

This holiday season, customers showed a slight preference for brick-and-mortar shopping over online based on total traffic, which peaked on key shopping days. During ‘Cyber Week,’¹ in-store traffic exceeded that of online, which was a reversal of last year’s trend. On Super Saturday (the Saturday before Christmas), retail foot traffic increased 58% compared to the year-to-date (YTD) daily average. The increased brick-and-mortar traffic may be attributable to renewed customer excitement about in-store shopping experiences.

Spend increases were driven by Club and Discount

In terms of retail spend, price conscious subsectors (e.g., Discount, Club) grew or stayed flat, while specialty subsectors (e.g., Office, Toys & Games, Home Improvement) continued to see sales decline. Club outpaced other retailers with 5% YoY holiday sales growth followed by Discount at 4% when compared to last year².

Club, Discount, and Jewelry & Watches were the only subsectors that saw increased spend YoY².

Artificial intelligence reached new heights this holiday

Web traffic from generative AI-powered chat bots increased 1,300% compared to prior year during the holiday season. Cyber Monday saw the biggest increase at 1,950% YoY. Consumers primarily used Generative AI for bargain hunting with 20% of shoppers surveyed indicating that they used Generative AI to find the optimal prices across online retail sites. AI also provided gift inspiration with 19% of holiday purchases influenced by AI, a 6% increase from 2023.

Social media lit up the season

Social media inspired gifting this year. 89% of customers surveyed earlier in the season said social media would influence their purchases.

Even more notable is the emergence of in-app shopping. In the Deloitte Holiday Retail Survey, 13% of consumers stated they were more likely to make purchases directly within social media apps this year, with Gen Z driving that trend. That prediction proved correct: TikTok Shop saw sales increase 223% YoY between November 1 and December 31, 2024.

Retailers relied on seasonal workers at the last minute

Only 280,500 seasonal jobs were added in November, which was down 5% YoY and the second-lowest number of seasonal workers hired in the past decade. However, the number of jobs added in December was the highest in a decade, likely due to the shortened Cyber Monday to Christmas shopping window.

Overall, carrier performance improved. There was a 27% YoY improvement in the amount of time it took to deliver a package in November, driven by operational investments including in artificial intelligence.

That’s a wrap on the 2024 holiday shopping season

Technological innovation, artificial intelligence-driven efficiencies, and supply chain stability provided the strong foundation for a record-breaking holiday retail season. Until next year!