The 40th edition of Deloitte’s annual Holiday Retail Survey reveals that American shoppers plan to spend an average of $1,595 in 2025, a 10% year-over-year decline, and the first notable dip since the post-pandemic recovery began. As economic expectations sink to their lowest point since 1997, 57% of U.S. consumers expect the economy to weaken in 2026, and nearly eight in ten anticipate higher holiday prices. Despite the cautious sentiment, a majority still plan to honor traditions by shopping for loved ones and celebrating the holidays — albeit with heightened focus on value and affordability.
Economic Pressures Reshape The Holiday Mindset
Deloitte’s Holiday Shopping Confidence Index (HSCI) signals that this season will be defined by restraint rather than splurging. Both key holiday categories, retail goods and experiences, are down (by 14% and 6%, respectively). Gen Z and millennials are cutting spending the most, down 34% and 13%, respectively, while only Gen X consumers buck the trend, planning a modest 3% increase. High-income earners (those above $100,000) are maintaining spending on experiences but trimming back on retail splurges.
Deloitte’s vice chair and U.S. retail leader Natalie Martini explains, “While the upcoming holiday season is marked by economic uncertainty, the pull of tradition seems to have many consumers doing all they can to spread holiday cheer. This includes seeking out value and expanding the shopping window to ensure they capture the best deals to make their holiday dollars go further. To meet and engage shoppers where they are, retailers that provide value, not just the lowest price could be positioned for a more successful holiday season and 2026.”
Value-Seeking Becomes a Lifestyle
Consumers are becoming more methodical in budget management. Nearly 9 in 10 (89%) say they are actively looking for deals, and 77% are prepared to trade down to lower-priced brands or retailers. 73% plan to recycle or repurpose gifts, while almost half (49%) will create DIY gifts to save money. Women (78%) and millennials (95%) lead the way in deal-hunting, while men trail at 58%. Loyalty programs are also increasing in importance — 26% of surveyed shoppers will use reward points to help finance their gift budgets, up six points from 2024.
Consumers are also pulling back on decorations and non-gift purchases, which are down 22% year-over-year, and the average budget for holiday gatherings has shrunk to $252, reflecting a 3% decline. Yet, one-quarter of respondents still intend to host family or friends, proving that the culture of togetherness remains strong, even under economic pressure.
Tech and Generative AI Drive Shopping Decision-Making
Technology remains a key enabler in 2025’s extended shopping season: 68% of consumers plan to use digital tools to compare prices and discover deals. Deloitte’s report notes that social platforms now power much of consumers’ purchasing inspiration, with 59% planning to use social media, particularly TikTok, Instagram, and Pinterest, for finding gift ideas.
A standout new development is the accelerating use of generative AI, which doubled year-over-year. One-third (33%) of holiday shoppers will leverage AI-based tools for product recommendations, gift ideas, and price monitoring. As a result, e-commerce remains dominant: 56% of intended gifts will be bought online, compared to 44% in-store. Shoppers continue to blend in-person experiences with online price-checking and click-and-collect convenience, underpinning the continued success of omnichannel retail models.
Timing and Channels: Thanksgiving Week Leads Once Again
Nearly 70% of respondents expect to shop during Thanksgiving week — a figure that has risen 23 percentage points over the past five years. While early promotions remain popular, half of consumers say they are spacing purchases out this year to better manage cash flow. One-quarter (24%) of consumers will have already exhausted most of their holiday budgets by the end of October, marking the earliest pre-season spend rate since 2019.
Large retailers and digital marketplaces are the clear winners this year, accounting for 75% of total planned spending (39% in big-box stores, 36% online). High-income shoppers remain the most likely to participate in Black Friday and Cyber Monday events, with 77% indicating active participation at some point between late November and early December.
Gifts Shift From Tech to Time
This year’s top gifting categories are gift cards and apparel, which tie for first place, while electronics have slipped downward. Notably, 47% of consumers plan to give experiences—like spa treatments, dining events, or concert tickets—rather than material goods. Self-gifting, a post-pandemic trend, has softened; only 32% of shoppers plan to buy for themselves, with younger generations preferring affordable private labels or “dupes.” Nearly half (44%) are open to gifting luxury items, though 25% are leaning toward pre-owned luxury, signaling the ongoing appeal of circular shopping models.
Retailer Takeaways Amid Uncertainty
Deloitte’s Brian McCarthy, principal and retail strategy leader, advises brands to innovate and adapt: “In a climate of economic uncertainty, retailers should recognize that traditional approaches may no longer be enough. To connect with today’s value-seeking consumers, it can be helpful to rethink strategies, embrace innovation, and tailor their strategies to engage consumers across generations and income levels. Retailers who adapt to these changing dynamics will likely be better equipped to navigate the season and foster lasting customer loyalty.”
Experts suggest that successful retailers this season will leverage promotions strategically, use AI to personalize digital experiences, and emphasize emotional connection instead of price competition alone. In many ways, the 2025 holiday shopper is more discerning than ever—balancing economic caution with a desire for meaningful celebration.
