Consumers to cut back on essentials to cover holiday purchases

Dive Brief:

This holiday season, 82% of consumers say they will try to save on groceries and other essentials to cover their holiday expenses, according to Inmar Intelligence’s 2025 Holiday Commerce Forecast released Friday.
Some categories are non-negotiable for the holidays, even if it means cutting back elsewhere, per the report. Those categories include gifts for family (45%), gifts for children (35%) and holiday traditions or experiences (28%), among others. 
Holiday shopping is expected to be almost equally split between physical and digital channels this year, with over 70% of U.S. consumers shopping online and 65% visiting stores in person. 

Dive Insight:

The upcoming holiday season will be shaped by economic pressures. Last year, inflation caused the majority of Americans (85%) to cut back on discretionary holiday spending, with 50% of people saying they are still experiencing economic difficulties, per the report. However, consumers are not going to abandon the holidays, but will instead pick their priorities when it comes to spending. 

“Higher costs and holiday pressures mean shoppers will make more intentional trade-off decisions in every category,” according to the report. “Every dollar will be scrutinized — but spending won’t drop.” 

Consumers will use a mix of savings formats, including digital and paper coupons, instant redeemables and direct-mail discounts to make their budgets stretch, per the report. Over half (55%) of survey respondents said that discounts, coupons or promotions influence their purchasing decisions, while 43% pointed to conveniences like curbside pickup and fast shipping. 

Additionally, consumers won’t shop through one channel, but will use several as decisions are being made. Four in 10 survey respondents said they will use their phone to check prices or reviews while in-store, and nearly the same proportion (38%) will look at products online before buying in-store.  

“Today’s purchase journey is increasingly nonlinear, and for the holidays, discovery and purchase will not happen in the same channel or at the same time,” according to the report. 

While more than half (59%) of respondents said they plan to buy their gifts in-store, 50% said they also plan to buy their gifts via mobile devices. Shoppers are also turning to their computers (31%) and social media platforms (15%) to purchase gifts. 

It remains to be seen whether this year’s shopping behaviors will mirror the 2024 holiday shopping season. Between Nov. 1 and Dec. 31, 2024, online retail sales saw an 8.7% jump year over year to $241.4 billion, according to an analysis from Adobe Analytics. By contrast, Mastercard’s SpendingPulse report, which reviewed purchases between Nov. 1 and Dec. 24, noted that in-store sales saw a 2.9% bump from the previous year, but online sales grew by 6.7%.