Attention, nostalgic holiday shoppers: Toys ‘R’ Us is back! The beloved retail chain is opening 30 physical stores just ahead of the most wonderful time of the year. This is just one reason the National Retail Federation is projecting holiday sales to surpass $1 trillion for the first time in 2025.
This year, consumers’ shopping habits are becoming more thoughtful, blending online convenience with the sensory experience of brick-and-mortar retail to find the best deals possible for the loved ones on their lists. To succeed this season, retailers must create a seamless experience across digital and in-person channels, aligning their offerings with consumers’ evolving priorities: value, convenience and meaningful connection.
Here are five tips and trends retailers should pay close attention to this holiday season:
1. Shoppers Plan on a Mix of Online and In-Person Spending.
Consumers are turning to e-commerce for convenience, price comparison and shipping flexibility, and many more will also seek the physical experience of visiting stores. Most shoppers plan to research and purchase across both channels, ordering some gifts online while heading to brick-and-mortar locations for décor, last-minute items and deals.
According to Shopify’s 2025 Global Holiday Retail Report, 43% of shoppers said they are more likely to make a purchase by discovering products in-store than last year. They plan to shop online for smaller items online but shop in person for larger purchases. In fact, according to Capital One Shopping research, most retail transactions (more than 80%) occur in physical stores. And according to PCW’s Holiday Outlook 2025, 39% say they’ll buy online and pick up in store.
Retailers that integrate online tools with a physical footprint give customers the best of both worlds: the efficiency of digital with the magic of the in-person experience. One example of a retailer doing this particularly well is Glossier. The brand frequently posts social content that reminds customers of multiple ways to purchase its products across channels.
2. Advertising Promotions Early are Critical.
Economic uncertainty has made consumers uneasy this year. Deloitte’s holiday survey found that three-quarters of surveyed shoppers (77%) expect higher prices on holiday goods and over half (57%) expect the economy to weaken in the next six months. Gen Z is especially cautious, planning to spend 34% less than last year.
According to PWC, 39% of total planned holiday gift spending will happen in the five-day period between Thanksgiving and Cyber Monday, and almost 80% of holiday gift budgets will have been spent by the end of Cyber Monday. This means that retailers should be mindful of getting their items on shoppers’ lists early.
The competition to give consumers the best deals is also intensifying. Target, Kohls and more started promotions in October, so to compete, other retailers should consider promoting and releasing deals earlier than Black Friday (and make sure those offers are visible across both digital and physical channels). With consumers carefully budgeting and comparing prices online before heading to stores, and the retail industry’s competition to attract and retain customers increasing, brands that create seamless experiences and provide good deals across shopping channels will have an advantage.
Families are a key audience that folks must keep in mind. Households with children under the age of 18 are “powering the holiday spend,” spending more than double compared to those without kids.
3. Shoppers are Turning to AI as a “Helpful Concierge.”
According to Shopify’s holiday report, consumers are turning to AI tools for holiday shopping inspiration, with 64% planning to use them this season. Nearly one-third of all shoppers say they’ll use AI to find deals, while 20% will use it to discover new products.
Consumers are also using AI tools to summarize product reviews, generate shopping lists and curate personalized gift recommendations based on recipients’ interests and budgets. A report from Customer Experience Dive details how “Consumers are more comfortable asking questions like they would speak to a friend rather than trying to find the right search terms,” with many shoppers preferring the manner in which chatbots conduct shopping research, like a “helpful concierge,” to a traditional search engine.
4. Think Beyond Gifts.
Retailers should think beyond sales of gift items this year to everything from food to experiences. According to PWC, almost three-quarters (72%) of Americans plan to gather over a home-cooked meal this year. Importantly, even amid economic uncertainty, 45% of respondents say they expect to spend more on grocery items for celebrations than last year.
Retailers also can’t overlook travel. Americans will spend nearly $311 billion on flights and hotels this holiday season, according to NerdWallet’s annual analysis of holiday spending.
When considering holiday promotions, retailers should think about products that can enhance travel (travel-friendly wardrobes or packable blankets), meals (dishware and decorations) or experiences. Nearly half of consumers plan to give experiential gifts like restaurant, event and spa outings.
5. Small Businesses are Having Their Moment.
According to the Intuit QuickBooks Holiday Shopping Survey 2025, U.S. customers plan to focus on small businesses this year, predicting a spend of around $109 billion, up 44% from last year. Meanwhile, 93% of small business owners say holiday sales are vital to their 2025 success as they face tariffs and inventory challenges.
With positive sentiment for small businesses on the rise, major retailers should consider promoting or partnering with smaller, local businesses this holiday season. Retailers who have done this particularly well include:
- Target, whose Target Takeoff and Forward Founders initiatives have helped thousands of small businesses;
- Amazon, where independent sellers have made an incredible $2.5 trillion in sales since 2000; and
- Dollar General, which issued a public call this summer for small business vendors and service providers.
The Bottom Line
Shoppers are spending more mindfully this season, seeking value, comparing prices and using technology like AI to make smarter decisions. But they’re still craving the sensory experience and emotional warmth of in-person shopping. With competition in retail heating up, brands must keep the benefits to their customers in clear focus. Families and small businesses will play an outsized role in driving this year’s retail momentum, and the retailers that succeed in this environment won’t just discount early or market louder; they’ll offer experiences across channels and genuine connections to shoppers.
Image via Unsplash.