Online consumption is expected to grow at the slowest rate in at least eight years during the US holiday season due to product shortages, rising prices, and lingering uncertainties related to the COVID-19 pandemic.

AdobeAnalytics predicts that online sales will grow an average of 10% in November and December this year to $207 billion, compared to a record 33% increase last year.

Retailers spent most of last year grappling with the economic lockdown and are currently dealing with the consequences of a series of pandemics, including blockages in global supply chains, which could lead to product shortages during the holiday season.

Vivek Pandya, chief analyst at Adobe Digital Insights, said on Wednesday that due to a lack of clarity about which products may be out of stock and when, it is difficult to determine whether product shortages will encourage consumers to shop more online or in physical stores.

Pandya added that the expected shortage of products and the risk of a resurgence of COVID-19 cases are also part of the reason Adobe's consumption forecast range has expanded this time, which is expected to increase between 5% and 15%.

Consumption growth in 2021 is expected to be partly driven by rising product prices, which will be the smallest increase since Adobe began tracking holiday season consumption data in 2014.

Adobe said that due to soaring product and transportation costs, companies have raised product prices one after another, and it is expected that consumer payments will increase 9% between Thanksgiving and Cyber Monday this year.

The company said that by the end of July, out-of-stock information on retailer websites had soared 172% from pre-pandemic levels, with clothing inventory being consumed the fastest, followed by sporting goods, baby products, and electronics.

In response to potential inventory shortages, retailers have opted to offer fewer discounts this year and are hoping to extend holiday season sales by encouraging shoppers to start shopping early.