Americans’ holiday spending is expected to peak despite macroeconomic uncertainty, against a backdrop of record-high inflation, tariffs and post-budget closures. “Consumers are still quite concerned about inflation,” said Mark Mathews, chief economist at the National Retail Federation (NRF).
According to him, we would have to go back – without taking the pandemic into account – to the early 1980s “to find morale low”. However, “over the years we have seen consumers shop regardless of their mindset.”
Therefore, the NRF estimates that purchases during the festive period – from November 1 to December 31 – will exceed $1,000 billion for the first time, with an increase of 3.7% to 4.2% year-on-year (+ 4.3% in 2024).
The 43-day budget paralysis, which left hundreds of thousands of civil servants on technical unemployment, led to a decline in private sector demand and revenues that is expected to reverse as soon as the policy is lifted on November 12.
On the other hand, massive import duties imposed by Donald Trump may affect certain products although, according to experts, intense competition will weaken these products. “We see a deliberate and determined approach to avoid passing on rate increases to consumers,” said Matt Shay, NRF president.
Competition, especially from the Internet, should prevent massive price increases. Price and free shipping are two “very important vectors” for buyers, emphasized Vivek Pandya, analyst at Adobe Digital Insights.
The share of online commerce is expected to continue increasing, according to Adobe Analytics, reaching $253.4 billion (+5.3% year-on-year), including a daily record of $5 billion during the ten-day “Black Friday” and “Cyber Week”.
AI is increasingly being used
“Considering the macroeconomic environment (…), a rise of 5.3% is not that bad,” estimates Vivek Pandya, emphasizing that buying started in October (+8.2%) to take advantage of operations such as Amazon Prime Day. But the peak is Friday, when the biggest discounts are expected (on average -28%), and Monday – “Cyber Monday” – for electronic products.
For Stéphanie Guichard, an economist at the professional association Conference Board, American consumers will “show some restraint, after several years of quite high inflation.” From its annual study, it appears that Americans have reduced the number of envelope packages (gifts and decorations) for end-of-year celebrations to an average of $990, or -6.9% over one year.
When adjusted for inflation, “these numbers are well below pre-pandemic levels,” the economist stressed, adding that Americans aim to offer their loved ones what they “need,” not what they want.
Watch the rise of generative artificial intelligence (AI), such as ChatGPT or Gemini, to find gift ideas and/or find the most attractive prices.
In October, traffic generated by AI agents to e-commerce sites jumped 1,200% year over year and these Internet users were 16% more likely to complete a purchase, according to Adobe. “This shows that with AI tools, consumers are better informed and able to identify the sellers that best suit their needs,” the company analyzed.
Another strong trend: “social commerce” (in English), which is emerging from social networks, especially influencers. This is a “particularly important” phenomenon this year, explains Vivek Pandya, especially in light of the fact “that influencers have become very effective in providing huge promotional codes or benefits”.
As for flagship products, experts mentioned not only the new Nintendo Switch 2 and iPhone 17 consoles, but also home appliances and renovation equipment as economic uncertainty deters many Americans from moving.
