Holiday Trends in Retail for 2025

The 2025 holiday shopping season will be marked by cautious consumer spending, retailers such as Target Optical, Walmart, etc. reducing prices on many of their products, the ongoing rise of AI-powered shopping, and evolving payment preferences. Here are some of the key predictions Off The Wall was able to find on various Websites tracking what to look for this approaching holiday season.

Target Optical - various locations by Off The Wall

Economic Outlook: Slower Growth, Tighter Budgets

Even though the National Retail Federation forecasts sales exceeding $1 trillion this year (for the first time), growth will still be only between 3.7% and 4.2%. National Jeweler quotes the NRF in an interesting article titled "Five Things Retailers Should Know About Holiday Shoppers This Year."    

Deloitte is projecting that Holiday sales will grow only between 2.9% and 3.4%.

Another website supporting this view is Avison Young, which says this season will move at the slowest pace in years. Consumer confidence sits at its lowest level since the early 1950s Avison Young, with households tightening budgets amid persistent inflation and economic uncertainty.

The AI Revolution in Shopping

The most dramatic shift this season is the mainstream adoption of artificial intelligence:

• Talkdesk predicts that three out of four consumers (75%) will use AI to find deals this season, up from 66% in 2024

• Avison Young believes that traffic from generative AI platforms like ChatGPT and Perplexity surged 4,700% year-over-year during Amazon Prime Day in July 2025,

• According to Accenture, 46% of US shoppers plan to use conversational or generative AI tools in preparation for Black Friday,

• And in the same article noted above, Talkdesk is predicting 67% plan to use AI for gift ideas, up from 54% last year

• About 70% of Gen Z consumers discover products on TikTok, writes eMarketer, and this highlights how younger shoppers are blending social media with AI-powered discovery tools.

Extended Shopping Season & Early Start

CEOWORLD magazine writes that 80% of all planned holiday gift shopping is expected to occur by the end of Cyber Monday, before December even begins. And in the same article we have been qouting Avison Young , they write that the holiday cycle has stretched into six months, beginning with summer deals like Amazon Prime Day in July and extending through mid-January promotions

Avison Young continues, "A new phenomenon called 'Q5' (December 26 through mid-January) has emerged as a powerful growth driver, capturing high-intent spending through gift card redemptions and resolution-driven demand."

Mobile Shopping Dominance

Mobile revenue share is forecast to hit a record 56.1% this holiday season, with 7 in 10 retail site visits taking place on mobile devices, according to an article in Adobe.

eMarketer states that Mobile commerce will drive over 90% of the net increase in holiday ecommerce sales this year .

Buy Now, Pay Later (BNPL) Growth

Half of consumers plan to use BNPL as a flexible payment option for holiday shopping this year, with 52% saying they're more likely to make a purchase when BNPL is available ( PayPal Newsroom). 78% of shoppers who use BNPL intend to use it this holiday season (Applause).

Value-Seeking Behavior

Consumers are becoming more strategic and price-conscious:

• An article in Retail Dive states that well over a third of holiday shoppers plan on buying more on sale, with many waiting for promotions before making purchases

• Lower- to middle-income households face mounting cost-of-living pressures, leading to increased traffic at value-oriented grocers, dollar stores, and off-price apparel chains, according to Placer.ai

• And PayPal Newsroom writes about how rewards will drive decisions, with 74% more likely to shop with merchants offering cash back or rewards

Omnichannel Shopping Returns

64% of shoppers plan to shop in-store this holiday season, with 41% planning to shop both online and in-store (PayPal Newsroom). 92.2% plan to shop online and 90.2% plan to shop in physical stores (Applause), demonstrating that successful retailers must excel across all channels.

Key Takeaways for Retailers

To succeed this holiday season, retailers should:

• Embrace AI tools to personalize recommendations and streamline customer service

• Offer flexible payment options, especially BNPL

• Start promotions early and maintain momentum through January

• Ensure seamless mobile shopping experiences

• Provide clear value propositions and competitive pricing

• Integrate online and in-store experiences with accurate inventory visibility

The 2025 holiday season represents an important moment where technology meets traditional retail, requiring adaptability and a deep understanding of increasingly sophisticated, price-conscious consumers.