For all Donald Trump’s talk about boosting the U.S. economy, the president-elect has already had an adverse effect on the booming e-commerce sector.
Per an Adobe Digital Insights report released Thursday, retailers lost nearly $1 billion worth of online sales in the first 14 days of November, with the biggest drop happening in the aftermath of Trump’s Nov. 8 victory, when sales growth trickled to 1.3% compared to the expected 7.8% surge.
“Consumers are distracted,” Becky Tasker, a managing analyst at Adobe Digital Insights, told Glossy. “They’re following public events and they haven’t quite flipped the switch to holiday shopping.”
Adobe’s data, aggregated from more than 18 billion visits to e-commerce sites, flies in the face of National Retail Federation (NRF) predictions that advised retailers to prepare for “a rush of consumers in the weeks following the presidential election as they get more economic and political certainty,” though that report came out in late October.
In fact, Adobe said the post-election plunge was the slowest growth for U.S. retail sales since 2012 and that the current collapse has persisted longer than the last one did. Tamara Gaffney, principal analyst and director at Adobe Digital Insights, likened it to the U.K.’s slip in consumer spending earlier this year caused by the country’s decision to leave the European Union, which sparked waves of economic uncertainty.
“Similar to Brexit and its negative impact on consumer spending on durable goods in the U.K., U.S. consumers seem to be holding off spending more online,” she told Glossy. “Instead of the expected 11 percent year-over-year increase, we expect growth to fall to single digits this year.”
With Black Friday and Cyber Monday mere days away, retailers hoping to make up for recent shortfalls in revenue by enticing consumers to spend big on limited-time promotions could be in for a rude awakening.
“Sales on Thanksgiving Day and Black Friday [this] week will be an important indicator of how much sales expectations need to be adjusted this shopping season,” Gaffney said.