Digital content helps holiday shopping hit record $35B

Bambi Francisco Roizen · December 28, 2011 · Short URL:

Fastest growth rate in four years, fueled by digital content, subscription purchases in 2011

Who says the economy is sluggish? If it is, it certainly didn't slow down the giving this Christmas. After we saw record-breaking sales of $1.2 billion on Cyber Monday, right after Thanksgiving, consumers continued on their shopping spree.

The latest figures show consumers spent $35 billion buying goods online this holiday season, up 15% from the same period last year, and faster than the 12% growth rate clocked in last holiday, according to comScore. In fact, the 15% growth rate is the fastest rate in holiday shopping sales we've seen since 2007, when holiday shopping sales jumped 19%.

The week ending December 25, saw a slightly bigger jump as consumers (not surprisingly) saved most of their shopping to the last minute. Some $2.8 billion in purchases were made in that week, up 16% from last year.

For the total holiday season (Nov. 1 through Dec. 31), shopping figures should come in at $37.6 billion, said Andrew Lipsman, a spokesperson at comScore, in an email. 

Even more impressive are the days that saw virtual registers ring up $1-plus billion in sales. In total, there were nine days in which online sales topped that threshold.

The trend that continues to play out this year is the significant increasing amount of purchases of digital content and subscriptions, like digital downloads of music, TV movies, e-books and apps. (ComScore only breaks out sales in this category for paying subscribers.)

If you're like my household (three sons and the biggest boy - my husband), in which Apple iTunes gift cards (for iPods, iPads) and Roku boxes were a big hit, it's not surprising. In other households, tablets and e-readers were popular. You may recall that 64% of shoppers said they'd buy a tablet this year. Kindle Fire sales on Black Friday were also up 4x from last year. By Christmas day, iOS and Android activations catapulted 353% from last year.

During the holiday season to-date (Nov. 1-Dec. 26), digital content and subscriptions accounted for 2.8% of retail e-commerce sales. But on Christmas day, this category made up more than a fifth of sales.  Digital content and subscriptions, which include iTunes, Amazon downloads and other digital content sales, was the No. 1 fastest-growing category, followed by electronics.

We've come a long way from when holiday shopping was just getting started about a decade ago and peak e-commerce sales occurred two weeks before Christmas, when shipping logistics were hardly as sophisticated as they are today.

But the growth isn't recent years has been sluggish. In 2005, online sales during the holiday season had already hit just under $20 billion. Growth rates were as fast as 26% in 2006, then down to 19% in 2007. Holiday shopping sales actually dipped 4% in 2008 and grew a modest 4% in 2009. 

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Bambi Francisco Roizen

Founder and CEO of Vator, a media and research firm for entrepreneurs and investors; Managing Director of Vator Health Fund; Co-Founder of Invent Health; Author and award-winning journalist.

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