Festive and Focused: The Spending Habits Defining This Holiday Season

For many consumers, the 2025 holiday season arrives in the middle of an uneasy economic moment. Inflation has cooled but not disappeared. Wage growth has stabilized but isn’t stretching as far as many hoped. 

And, while consumer confidence is holding, household budgets remain tight. In fact, new research shows 64% of Americans are decreasing their household spending in at least one category heading into the holidays, reflecting a cautious but pragmatic mindset.

This holiday season consumers are embracing new tools, leaning on flexible payment options, and making highly intentional choices about where and how they shop. 

Check out these key themes this holiday season and how they impact consumer financial health.

1. Consumers Are More Strategic with Spending Than Ever

Even in a tough economy, shoppers are still showing up for major retail moments. Black Friday and Cyber Monday both saw meaningful year-over-year increases. Adobe Analytics reported consumers spent a staggering $25 billion between these two days — up between 6% and 9% from 2024. 

Overall, it’s clear consumers are still participating in seasonal shopping milestones. And, further analysis shows many are  doing so more strategically, when deals and sales are at their height.  

2. Stockings Filled by AI with Care

AI-generated gift recommendations, price monitoring, and intelligent checkout experiences are shaping a large portion of this year’s online shopping growth. In fact, retailers using artificial intelligence drove record-breaking online shopping numbers over Black Friday and Cyber Monday. AI-driven traffic to U.S. retail sites increased 805% on Black Friday and 670% on Cyber Monday, according to Adobe Analytics.

In addition, PYMNTS reports that 1 in 2 consumers actively used AI at least once during their Black Friday shopping. And, while nearly 1 in 3 (30%) consumers said AI was helpful for generating gift ideas, the top use centered on getting the best deals. Thirty-five percent of consumers said AI was helpful in price tracking and 42% said AI was helpful in finding discount codes or deals. 

3. Presents Now, Pay Later Continues to Surge

This holiday season, Buy Now, Pay Later (BNPL) transactions surged, driving over $1.03 billion in online sales on Cyber Monday alone. 

For many, BNPL likely wasn’t about being able to buy more stuff. It was helping them make spending more manageable by spreading the cost out over time. In fact, approximately 37% of consumers say they bought fewer items than last year. 

Indeed, among shoppers living paycheck to paycheck, use of fixed credit-card installment plans and BNPL rose sharply — up 9 points in the last year. 

Used wisely, BNPL can serve as a powerful budgeting ally for consumers in their holiday spending. 

Looking Ahead: A Holiday Season Shaped by Awareness and Adaptation

Holiday spending is definitely here. But, data across the industry shows thoughtful, informed choices can help people stay grounded — and financially strong — during the holidays and beyond.