Spending rebounds, shoppers embrace AI: Insights from our 2025 Global Holiday Retail Report

As pumpkin spice weather gives way to eggnog season, shoppers have already begun their holiday shopping—and 26% start by the end of September. The holiday rush looms, with merchants facing their greatest challenge of the year: cutting through when marketing noise peaks. 

This battle for attention unfolds as consumer behaviors shift beneath the surface.

Consumers are spending more—but sticking to stricter budgets. They're shopping with AI discovery, bouncing between screens and stores, and expecting nothing less than seamless experiences, instant checkout, and brands that feel authentic. 

Shopify’s 2025 Global Holiday Retail Report* uncovers how brands can thrive in this reality and turn these insights into action during the make-or-break holiday rush.

Here are the highlights.

Holiday spending bounces back—budgets hold firm

Globally, shoppers report a $37 increase in planned spend this Black Friday Cyber Monday sales season—up from $155 in 2024 to $192 this year. But this isn’t an indication of impulsive buying. Shoppers want to stretch their dollars this year with 51% poised to set clear spending caps and 23% establishing stricter budgets.

The early adopters

Blume, known best for its gut health products, is not only benefitting from a boom in wellness supplements. The brand is also set to capture this season’s extra spending dollars by appealing to the value hunters. Its bundles and starter kits offer big savings for customers, with many meeting Blume’s free shipping threshold. Even in 2024, bundle deals dominated the brand’s Black Friday Cyber Monday strategy.

Discounts will go a long way for shoppers looking to extend their dollars. MeUndies offered deep reductions across its collections for BFCM 2024. And the brand has started the deals early this year—catching those advance shoppers—with bestsellers marked 50% off on the site.

The takeaway

Merchants appealing to holiday shoppers should emphasize value during BFCM promotions. Think discounts, gifts with purchase, shipping deals, or bundled products.

AI goes mainstream for holiday shopping

Shoppers are increasingly turning to AI for holiday shopping inspiration with 64% planning to use AI tools this season. Adoption varies by demographic: this number jumps to 84% among shoppers aged 18 to 24. Almost a third of all shoppers will use the tech to find deals while 20% say they’ll tap it for product discovery. 

Merchants are already responding to the demand: Nearly nine in ten businesses globally are investing in AI-powered discovery.

The early adopters

Children’s apparel brand Brave Little Ones is already ahead of the curve, migrating to an AI-powered theme ahead of last year’s BFCM. The team also plans to use Sidekick to develop custom banners for this year's promotional campaign.

The takeaway

Personalization at scale drives incremental purchases, especially for brands with younger target demographics. Shopify merchants already have an advantage, with Sidekick built into every store and access to AI-powered apps to boost discovery.

Discovery happens everywhere

While some shoppers plan to use AI for their shopping this holiday season, it’s not the only way they’ll discover brands. Compared to last year, 43% say they’re more likely to discover and purchase products in store this year (versus 40% online). Merchants offering a hybrid experience stand to outperform both as 44% say they’ll shop smaller items online but head to stores for larger purchases. 

The early adopters

Glossier is one example of a brand going big on unified customer experiences. It offers a buy online, pick up in store delivery option and posts social content that reminds customers of multiple ways to purchase across markets.

Glossier also runs pop-up events, promoted across social channels and the brand’s website. When shoppers turn up to shop in person, Glossier’s stores look just like its website. The seamlessness builds brand affinity and trust.

The takeaway

A consistent experience across channels captures more sales. Merchants can close the browse-buy gap with inventory and pricing synced across channels, convenient delivery and pickup options, and surprise-and-delight campaigns. Those using Shopify POS already benefit from a consolidated back office and an uninterrupted experience for customers.

Trustworthy experiences and authenticity drive loyalty

Trust and loyalty are earned. And once a brand gains trust with customers, it’s an easy thing to lose. Almost half of shoppers (48%) have abandoned a purchase in the last year due to a complicated checkout process. 

Aside from ensuring a smooth customer experience online, there are other ways brands can build trust over the holiday season. Values-driven businesses resonate with more than one in five shoppers while almost a third prioritize supporting local businesses. 

Capturing shoppers' attention with strong values and a local presence is just the first step. Retaining them relies on meeting their needs all year long. Among the factors shoppers say will earn their loyalty are: 

• Discounts 49%
• Free shipping and returns 41% 
• Loyalty programs 29%

The early adopters

Family sleepwear brand Little Sleepies offers free shipping on domestic orders over $25—a threshold that covers most orders. Returns for store credit are free too. The brand goes a step further to gain trust, with its values woven into site content.

Death Wish Coffee rewards loyalty in a big way. Its subscription program—dubbed The Society of Strong Coffee—boasts member perks like exclusive merch, discounts, and loyalty rewards.

And tea company Apolis Tea appeals to local shoppers both in its home state of Washington and across the country. The brand promotes “made in USA products” and tailors social messaging to local happenings and values. 

The takeaway

Balancing a unified shopping experience with clear, visible values and customer perks can earn trust and lasting loyalty in a modern market. Shopify merchants already benefit from the world’s highest converting one-click checkout. 

Wrapping up

The 2025 holiday season will reward merchants who embrace both technology and authenticity. As consumer spending increases alongside AI adoption, the opportunity has never been greater to deliver value and connect with shoppers in meaningful ways. 

Packed with actionable insights, Shopify's 2025 Global Holiday Retail Report positions merchant’s businesses for their strongest holiday season yet.

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*Methodology: Survey of 18,000 shoppers and 7,500 businesses across 9 countries (Australia, Canada, France, Germany, Italy, Japan, Spain, the UK, and the US) conducted by Sapio Research, August-September 2025.