As the 2025 holiday season approaches, U.S. consumers and retailers alike are bracing for a unique blend of economic anxiety and evolving shopping habits. A pair of new reports—one from Monetate and another from Sensormatic Solutions—shed light on how Americans plan to shop, what they're worried about, and how retailers are responding to shifting priorities in a year marked by inflation, technological change, and a calendar quirk that puts Christmas on a Thursday for the first time in over a decade.
According to Monetate's first annual Holiday Shopper Survey, which polled 1,500 U.S. consumers in late August, a striking 67% of respondents say they're concerned about rising prices, tariffs, and inflation affecting their holiday shopping. It's no wonder, then, that 76% are actively hunting for discounts and promotions to keep spending in check. "Our survey data shows that over half of consumers anticipate spending the same amount or more on holiday gifts compared to last year," Monetate CEO Steve Maher told reporters. "And while many are bargain-hunting, over 60% still plan to splurge on themselves or others this season. This balance between bargain-hunting and selective splurges presents a strategic imperative for retailers to deploy AI-driven personalization to deliver targeted value in real-time."
The survey paints a picture of measured optimism. Despite widespread economic jitters, Americans are not planning to slam the brakes on holiday spending. In fact, over half expect to spend as much—or more—than they did in 2024. The top spending priorities? Apparel and footwear lead the pack, with 46% of respondents putting them at the top of their lists. Electronics follow at 35%, and groceries or household items come in at 34%. But the "treat yourself" ethos is alive and well: 40% of shoppers plan to splurge on electronics, 37% on travel and experiences, 34% on dining and entertainment, 28% on beauty and personal care, and 35% on luxury goods.
How people shop is changing, too. The traditional dash to the mall is being replaced—or at least complemented—by a more seamless, omnichannel approach. Monetate's survey found that 65% of consumers plan to rely more on retailer websites and apps, while 58% still favor in-store visits and 21% opt for buy-online-pickup-in-store (BOPIS) options. Loyalty to local businesses remains strong, valued by 62% of respondents, but online stores (63%) and mobile devices (43%) now edge out physical stores (42%) as the preferred shopping channels. Social media also wields growing influence, affecting 32% of purchases.
One of the most significant shifts is the rising role of artificial intelligence (AI) in the shopping process. Nearly 69% of those surveyed say they're interested in using AI tools to find gifts, deals, and recommendations. In fact, 46% would use AI specifically to hunt for gifts and bargains. However, this embrace of technology comes with a note of caution: 53% of respondents expressed reservations about using AI for shopping, with 30% citing privacy concerns. Retailers, for their part, are responding by leveraging behavioral data to surface tailored promotions—an approach that Monetate says can boost conversions by 15-20%.
This year, retailers are advised to deploy a suite of strategies to engage cost-conscious consumers. Among the recommendations: deliver real-time, price-sensitive promotions via AI; optimize discounts through dynamic A/B testing; bundle essentials with indulgences (like electronics and apparel) to elevate order values by up to 25%; and spotlight gift cards with targeted pop-ups. Creating seamless omnichannel experiences is also key, as is leveraging geo-targeted offers and BOPIS reminders, which can boost comparison shopping by 30%. The report emphasizes the importance of building trust with ethical AI and using consent-based personalization to enhance engagement, especially as privacy remains top of mind for many shoppers.
Meanwhile, the calendar is throwing an extra wrinkle into this year's holiday shopping landscape. According to a Sensormatic Solutions report published on September 23, 2025, Black Friday will once again reign supreme as the busiest shopping day of the season. The last two Saturdays before Christmas are expected to follow closely behind. "The holiday rush is right around the corner, and competition for customer attention this year will be fierce," said Tony D'Onofrio, president of Sensormatic Solutions. "Our busiest days predictions can help retailers get a sense of what's to come and—when paired with source-to-store visibility into their supply chains—guide the path to the convenient, seamless in-store experiences shoppers crave."
Yet, in-store traffic tells a story of its own. Sensormatic predicts that U.S. in-store traffic for the 2025 holiday season will be relatively flat to down by as much as 3% compared to last year. So far in 2025, in-store traffic has already dipped by about 2.5% on average. Early promotions and mounting concerns about product availability are pushing shoppers to get their gift-buying done earlier, and the late-week Christmas holiday may result in a sustained high-traffic period in the week leading up to December 25. Grant Gustafson, head of retail consulting and analytics at Sensormatic Solutions, noted, "To no one's surprise, our predictions show that Black Friday will still be the highlight of the U.S.' holiday shopping season, but retailers are likely to see some interesting deviations from recent years thanks to the calendar and changing shopper preferences."
Retailers are keenly aware that the stakes are high. With in-store traffic slightly down and shoppers more digitally savvy than ever, the challenge is to create experiences that are not only convenient and seamless but also personalized and trustworthy. The Monetate report suggests that continuous experimentation—through A/B testing and scaling personalization variants—can fuel a virtuous cycle of insights, refining strategies for better conversions and greater value. Bundling essentials with indulgences, for example, can lift order values by up to 25%, while geo-targeted offers and timely reminders can keep shoppers engaged and drive last-minute sales.
For consumers, the 2025 holiday season is shaping up to be a balancing act between caution and celebration. They're watching prices closely, hunting for deals, and increasingly open to AI-driven recommendations, but they're also ready to indulge a little—whether that's splurging on a new gadget, booking a memorable trip, or treating themselves to a luxury item. Retailers who can meet them where they are—online, in-store, or somewhere in between—stand to benefit most.
With Christmas falling on a Thursday, the final days before the holiday are expected to see a sustained surge in shopping activity, as last-minute buyers scramble to check off their lists. Whether this season ultimately lives up to retailers' hopes may depend on how well they adapt to consumers' evolving expectations: more value, more convenience, and just the right touch of technological magic.