ROCHESTER, N.Y. — Online retailers saw a significant boost in sales over the holiday shopping weekend. Americans spent over $10 billion online on Black Friday and another $13 billion on Cyber Monday.

However, despite the increase in online spending, many retailers remain cautious about the holiday sales outlook. While online spending on Cyber Monday rose by 7% compared to last year, in-store spending increased by less than 1%. This is concerning for retailers without a strong online presence.

Experts from Adobe Analytics note that discounts on electronics, toys, cosmetics, and clothing are deeper this year. Retailers have used push notifications and emails to entice consumers to spend, but shoppers have become more selective, waiting for the right price before making purchases. The ability to compare prices online is a major factor driving consumers to shop online.

Retail analysts indicate that dollar stores are feeling the impact, with lower-income customers increasingly opting for retailers like Walmart. The lean staffing and low pay at dollar stores can result in disorganized aisles and a poor customer experience. While Dollar Tree attracts a more diverse customer base than Dollar General, it has also experienced a decline in customers.

Adding to the holiday spending challenges, some store credit card companies, such as Synchrony and Bread Financial, are raising interest rates. CNBC reports that rates on some retail cards have surged as high as 36%. These companies issue store brand cards for retailers like Lowe’s, JCPenney, and Ulta Beauty. The rate hikes are in anticipation of a new rule that would cap late fees at $8, although this rule is currently tied up in court.

The irony is that the rule may never go into effect, but the consumers it was meant to protect are ultimately paying the price.

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