First Insight’s 2025 Holiday Shopping Report Reveals That 74% of Consumers Plan to Spend the Same or Less Than Last Year, Turning to Gift Cards and Discounts to Stretch Their Budgets

First Insight, the company that leverages AI to transform consumer feedback into profitable retail strategies, has released findings from its 2025 Holiday Shopping Report. The new report reveals that a majority of holiday shoppers plan to use social media (57%) and AI tools (39%) to make shopping easier this year—from researching gift ideas and discovering sales. While forty-two percent (42%) of consumers plan to checkout directly through social media, shoppers are increasingly looking to AI as their holiday “one-stop-shop,” with 68% of those using tools such as ChatGPT, Gemini and Claude purchasing directly through them. This shift towards AI-driven shopping is especially prevalent among Gen Z shoppers, with 73% saying they’ll use AI for everything from product discovery to purchase.

For many shoppers this holiday season, AI will work as a personal assistant, delivering tailored product recommendations and finding sales and promotions–which is especially important as many consumers approach their shopping with a stronger focus on budgeting. Nearly three-quarters (74%) of consumers say they will spend the same or less than last year, with 41% planning to buy fewer items overall and 23% actively seeking deals. Eighty percent (80%) of shoppers say they would need at least a 15% discount to consider buying a product this year.

First Insight works with major retailers and brands to help them understand consumer preferences, what shoppers value and the motivations behind their purchasing decisions. The company recommends that retailers engage directly with consumers to gauge how much they’d be willing to pay for products, what discounts or promotions would influence their holiday purchasing decisions, and predict how this will impact next year’s pricing, merchandising and product strategies. The 2025 Holiday Shopping Report based on responses from 1,145 U.S. consumers aged 18 to 80+.

Among the findings:

• Price and convenience continue to drive shopping behavior, both in-store and online. Consumers cite price/deals (58%) and ease of shopping/convenience (47%) as their top reasons for shopping in-store, with the same factors (55% and 47%, respectively) motivating online purchases.
• Consumers are worried packages may not arrive on time, and are willing to pay more to ensure they do. Nearly 6 in 10 (57%) consumers say they’re concerned about shipping delays this holiday season (up from 48% last year). Most consumers (86%) say they’re willing to pay for shipping, with 17% willing to pay over $20.
• Gift cards will be a go-to option to stay within budget. More than two-thirds (68%) consumers plan to purchase gift cards this year—up from 64% in 2024. Sixty-two percent (62%) say they’ll purchase more gift cards this year than last, as a way to manage spending.
• Consumers are leaning into essentials, purchasing more apparel and personal care items. In stores, shoppers plan to purchase athletic footwear (27%), casual apparel such as jeans and button-downs (26%) and beauty or personal care items (24%). Online, athletic footwear (27%) and casual apparel (29%) are the top categories, alongside entertainment and electronics items such as movies, music, books and board games (27%), and tech gadgets or video games (29%). Sixty-five percent (65%) of consumers say they do not plan to purchase luxury items at all this holiday season.
• Facebook and TikTok are the top social platforms used to discover and shop for gifts. For holiday shopping research, consumers turn to Facebook (59%), TikTok (54%) and YouTube (52%) the most. Facebook and TikTok lead the way (59% and 54%, respectively) when it comes to completing purchases, followed by Instagram (47%).
• Big-box retailers hold their lead as preferred stores for holiday shopping. More than one-quarter (26%) of consumers say they prefer to do their holiday shopping at big-box retailers like Walmart and Target, followed by ecommerce marketplaces (15%) and outlet stores (10%).

“This holiday season marks the moment AI truly enters the shopping aisle,” said Greg Petro, CEO of First Insight. “Consumers aren’t just using it to search — they’re buying through it. At the same time, they’re more cautious about spending, focusing on price, value and convenience. Retailers that listen to their customers and adapt quickly to these new buying behaviors will be the ones building loyalty that lasts long after the holidays.”

First Insight helps retailers and brands eliminate risks associated with getting merchandising wrong, overestimating product demand, pricing poorly and otherwise incorrectly guessing what consumers will want and pay to get it. By integrating consumer feedback into every decision they make, First Insight replaces even the best retail guesswork with insight-driven decisions. As a result, brands and retailers across industries can move quickly and confidently to optimize product decisions that drive loyalty and margin.

The full 2025 Holiday Shopping Report can be viewed here.

About First Insight

First Insight is a global retail platform that uses its native AI to turn real-time customer feedback into profitable strategies for more than 600+ brands and retailers. Companies like Under Armour, Woolworths and Family Dollar rely on First Insight to understand what consumers will buy, what they won’t, how much they’re willing to pay, and how these and other factors directly influence planning, inventory and margins. First Insight further transforms customer feedback into a Value Score™, assigned to every single product it gains insight on. These scores accurately predict the viability of and demand for products so that retailers can confidently make design, pricing and inventory decisions that will deliver measurable financial impact. The company’s Voice of the Customer Platform is central to its offering and boasts a network of 360+ million consumers spanning 180 countries and 67 languages and currencies. First Insight was founded in 2007.

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