Afterpay insights reveal early holiday shopping trends

Afterpay has published its latest Festive Insights report, revealing significant trends in holiday shopping for 2023 and projections for Christmas 2024.

The report highlights substantial consumer activity during the holiday season, with over 3.2 million Australians and New Zealanders using Afterpay services, resulting in 35.4 million orders. This equates to an average of 267 orders per minute during the period. Customers spent an average of AUD $1,400 each, engaging in 10.3 transactions on average. This contributed to a 25% increase in sales compared to the previous quarter.

Afterpay's research, conducted via the Ideally Insights Platform, suggests that 59% of Australians intend to spend the same or more on gifts this Christmas compared to last year. This demonstrates a resilient consumer spirit despite ongoing economic challenges.

The company observed a trend towards early holiday shopping, with 44% of consumers starting their gift purchases as early as October, leveraging sales events like Black Friday. Such planning helps to manage spending and avoid last-minute purchases.

Flexible payment options, such as Buy Now, Pay Later (BNPL), are becoming more popular. Of those planning to utilise BNPL services this festive season, 41% expect to purchase at least half of their presents using the service. The benefits cited for using BNPL include improved budgeting and money management.

Katrina Konstas, EVP and Country Manager for Afterpay APAC, noted, "This year's festive spending season is set to reflect a strong shift towards mobile commerce, with consumers increasingly seeking flexibility and convenience for their Christmas shopping. Our data shows that shoppers are planning ahead, starting their holiday purchases earlier than ever, and using Buy Now, Pay Later to spread the cost of gifts over four more manageable payments. Despite economic pressures, Australians remain committed to making the most of the festive season, and we're seeing a growing focus on self-care and the joy of shared experiences."

Mobile shopping is projected to surpass in-store purchases threefold this festive season, reinforcing the shift towards digital commerce. The report also forecasts an increase in BNPL usage, particularly among younger demographics, with 70% intending to use such services.

Gift preferences have been outlined, with a substantial interest in gift vouchers, travel and experiences, clothing, footwear, accessories, and electronics. Additionally, 31% of respondents indicated a focus on self-care spending for themselves during the festive period.

Early-bird shopping practices remain prevalent, driven by younger families targeting savings during periods like Cyber Week.

Afterpay's insights further suggest that omnichannel shoppers, those who engage using both online and in-store methods, tend to spend more than those sticking to a single channel. They propose strategic early advertising to retailers to build first-party audiences ahead of Cyber Weekend to maximise outreach.

Overall, a robust mobile-friendly e-commerce presence is underscored as crucial for capitalising on mobile commerce trends, with transactions noted to have increased by 20% year-on-year in Australia.