Holiday Shoppers Tighten Belts Embrace Value and Digital Tools This Season

This holiday season signals a notable shift in consumer behavior, as shoppers plan to spend less and adopt a more strategic approach, according to Deloitte’s 2025 Holiday Retail Survey. The report forecasts an average consumer spend of $1,595, marking a 10% year-over-year decline and the first significant pullback in spending since the pandemic. This reduction is particularly pronounced among younger demographics, with Gen Z shoppers expected to decrease their spending by 34% and millennials by 13% compared to last year.

Despite the anticipated decline in overall expenditure, consumers are still committed to celebrating, albeit with a keener eye for value. Forty-four percent of respondents expressed an interest in purchasing luxury items this season; however, a quarter of those surveyed are considering pre-owned luxury goods as a cost-effective alternative. To further maximize their holiday budgets, shoppers also intend to significantly cut back on non-gift purchases, such as hosting essentials, clothing, and décor, which are projected to see a 22% year-over-year decline.

Natalie Martini, vice chair and U.S. retail and consumer products sector leader at Deloitte, highlighted this strategic shift, stating, “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.” She added that this includes "seeking out value and expanding the shopping window to ensure they capture the best deals to make their holiday dollars go further." Martini advises that retailers who can provide genuine value, not just the lowest price, are likely to be better positioned for a successful holiday season and into 2026.

In terms of gifting trends, fashion and accessories continue to be among the most popular categories, alongside gift cards. A significant 47% of respondents plan to give experiential gifts, such as dining experiences or spa visits, indicating a preference for memorable moments over material possessions. Conversely, self-gifting is expected to soften, with only one-third of consumers certain they will buy gifts for themselves.

Digital tools are playing an increasingly crucial role in the holiday shopping journey. Two-thirds of consumers intend to use digital platforms to compare prices and products, while social media remains a key source of fashion inspiration for nearly 60% of shoppers. The use of generative AI has also doubled since last year, with one in three consumers planning to leverage this technology to discover and evaluate products, showcasing a growing reliance on advanced digital assistance.

Brian McCarthy, principal and retail strategy leader at Deloitte Consulting LLP, underscored the need for retailers to adapt to these evolving dynamics. “In a climate of economic uncertainty, retailers should recognize that traditional approaches may no longer be enough,” he noted. McCarthy emphasized the importance of rethinking strategies, embracing innovation, and tailoring approaches to engage value-seeking consumers across all generations and income levels. Retailers who successfully adapt to these changing behaviors will likely be better equipped to navigate the season effectively and foster lasting customer loyalty.