Inflation Will Keep Holiday Online Sales Stagnant, Forecasters Say

Total online shopping orders this holiday season are expected to decline from 2021 as consumer budgets are pinched by inflation.

In the US, the number of online orders is forecast to drop 5% compared with the 2021 holiday season, according to data from Salesforce Inc., which develops software for companies. Globally, e-commerce orders are seen falling by 7%. Online sales in November and December are expected to remain “essentially flat,” Salesforce said, likely due to higher prices despite the predicted drop in units.

Prices for household necessities including rent, electricity and groceries have risen for months while inflation erodes US wage gains from the last year and a half. This is limiting consumers’ buying power -- an unwelcome development for retailers that depend on the year-end splurge to meet their financial targets.

Even so, demand has broadly held up this year. Retail sales rose unexpectedly in August, according to Commerce Department data on Thursday. The data aren’t adjusted for inflation, so the pickup could reflect price increases.