Spike in last-minute Labor Day travel bookings provide insight into future state of holiday travel

Blue suitcase against blue background

If Labor Day is any indication, consumers may be ready to travel during the upcoming holiday season, though bookings will likely come in last-minute.

In the two weeks preceding Labor Day weekend, consumers – many of whom stayed put this summer rather than vacationing – booked 60 percent more flights than the two weeks prior, according to the latest Adobe Digital Economy Index (DEI), which uses Adobe Analytics to track the state of e-commerce.

For the two weeks preceding Labor Day in 2019, growth was only 45 percent – suggesting that this year’s travelers are deliberating about booking flights until nearly the last minute, according to John Copeland, Adobe’s VP of marketing and customer insights.​

“This has potentially positive implications for holiday travel in November and December,” he says.​

Despite the last-minute uptick in flights, COVID-19 still heavily impacted the overall volume of travel bookings for Labor Day this year, Copeland says, with domestic flight bookings down 58 percent year over year (YoY) and hotel bookings down 20 percent YoY.

Of note, travelers from the Midwest were most willing to travel for Labor Day, with flights originating in that region down just 36 percent YoY, whereas flights from the Northeast — where people were most reluctant to travel — were down 61 percent YoY, the analysis found. ​

Labor Day drives muted sales impact

Labor Day online sales were below the expected forecast — even for a world without COVID-19 and lockdowns. E-commerce spend during the long weekend was $2.6 billion, up just 12 percent YoY, while the week leading up to it saw a 33 percent increase in growth YoY, according to the DEI.

Labor Day online spending graph

“The relatively low online turnout for Labor Day is a grand reversal of the pattern we’ve been seeing for the past few years. In the past, holidays have almost always grown faster than the average day,” Copeland says. “But what we are seeing is that the elevated online shopping levels due to COVID-19 are minimizing the impact of specific shopping holidays and events.”

​E-commerce sales continue to slowdown as states re-open

Not only were consumers more willing to travel in August, many more also flocked into physical stores as businesses continued to reopen. Consumers spent a total of $63 billion online in August. This represents a month-over-month decline in e-commerce growth for the last three months, while online sales were up 42 percent YoY in August compared to 55 percent in July and 76 percent in June.

Actual versus expected online spending in 2020

“Now, 42 percent YoY growth is a lot higher than what’s typical for August,” Copeland says. “But we are seeing online spend slip as states reopen. This could have interesting implications for the 2020 holiday shopping period — assuming that states continue to re-open and COVID-19 levels stay the same or improve.”

Less spending on apparel YoY, in particular, contributed to the topline decrease in e-commerce in August, DEI finds. A complementary study, which surveyed more than 1,000 consumers in the United States, found 52 percent of consumers said they did, in fact, spend less on apparel online in August.

Regardless of this month’s dip in e-commerce sales, 2020 online shopping levels are higher than ever before. While 2019 had only two $2 billion spending days outside of the holiday season, 2020 has already had 130 days. In addition, this year we’ve already had three nonholiday season days that passed the $3 billion mark: May 4, May 18, and May 25; there were none last year. ​

Mobile reigns supreme, BOPIS usage soars

More than half – 60 percent – of online retail website visits in August came from mobile devices, with mobile now accounting for 40 percent of all online sales. That means a staggering $190 billion has been spent via smartphone devices this year, and DEI predicts smartphones will surpass 50 percent in spend by September 2022.

Online spending using smartphone graph

Buy online/pickup in store (BOPIS) usage surged in August, with 59 percent growth over July and 259 percent YoY. Copeland attributes this growth to the fact that consumers continue to be more comfortable venturing out to stores, and retailers continue to improve the BOPIS experience.​ According to our survey, 30 percent of online consumers prefer using BOPIS or curbside over home delivery.​

“There may never be another holiday season quite like holiday 2020,” Copeland says. “Both in-store and online experiences will be different than in years past, as stores become more contactless to abide by social distancing rules and digital channels work harder to convert shoppers into buyers. And if you felt like the holidays came early last year, they will likely get here even earlier this year around. 2020 has been a difficult year, and consumers are looking forward to the comfort of the holiday season.”