Expecting higher costs, Americans choose to spend on themselves and travel this holiday season

• Expected winter 2025 spending is up for essential categories like groceries (+23%), automotive (+12%), and personal care (+7%), though increases are less than last year; consumers also expect to spend more on apparel (+3%) and personal care products (+2%).
• Consumers expect to spend less on toys (-15%), furniture (-12%), and hobby supplies (-9%).
• Despite their cautious outlook, holiday shopping is set to increase, with consumers planning to spend approximately 4.6% more on holiday shopping compared to last year. 

• The top gifts people want to receive are money (57%), gift cards (48%), and apparel (39%).
• 57% plan to shop for themselves this holiday season, with expected spending on oneself up 20% year-over-year for an average of $379.
• Self-care is not only limited to self-spending this year. Of the consumers who plan to participate in “Dry January” (30%), nearly half (48%) cited improving their overall health and well-being as the primary reason.
• Expected holiday travel spending is up 10% year-over-year with Americans expecting to spend an average of $1,127 on travel alone. This is driven by more consumers making bigger ticket travel purchases of $1,000 or more.

• 41% report using AI to research purchases, with another 22% indicating they’re interested in using it in the future.
• GenAI use is even more pronounced among younger demographics, with more than half of Gen Z (56%) and Millennials (62%) using it for research purchases.
• Nearly 70% of shoppers report making a purchase after seeing something on Amazon. One-third reported making a purchase after seeing something on YouTube, and one-third reported making a purchase after seeing something on Instagram.

“AI shopping assistants are setting new standards for what personalized retail service can look like. When AI can make tailored gift recommendations, offer immediate style consultations, and support virtual try-on experiences, consumers receive a new level of attention and care that may have once seemed impossible to scale,” said Julia Wilson, Principal, KPMG U.S.