Top 5 themes making retail headlines for holiday 2025

The retail holiday season is essentially here. Merchandise is in transit, promotional calendars are set (for now), and the technology freeze is quickly approaching. So, how will things play out this year?

We know consumer spending will be higher, but that’s only a part of the story. Salesforce data, which my friend Caila Schwartz has been reporting on for the last ten years, shows that “November and December digital sales are expected to reach an unprecedented $1.25 trillion, marking a 4% year-over-year (YoY) increase. In the U.S., digital sales are forecasted to grow 2% for a total of $288 billion.” Beyond this headline, here are five key themes that we’ll all be talking about throughout the end of the year.

1. Tariffs hit shelves: Tariffs are finally hitting the shelves and, along with inflation, are creating a ripple effect across the entire retail ecosystem. People will be very conscious of rising prices and seeking value this holiday season. Research that Cordial conducted in late spring shows that 70% of U.S. adults were anticipating higher prices. Consumers will especially feel the pinch from imported gifts due to the US suspending the de minimis exemption—with all goods valued at $800 or less now subject to duties and tariffs. Interesting fact…39% of respondents from the same survey stated that a product’s country of origin has an extremely or very important factor on their purchasing decisions. Retailers are already leaning into this message with their marketing.

How to win: Don’t compete on price alone—earn attention through meaningful value stories. Segment customers by price sensitivity and craft targeted messages around quality, craftsmanship, and origin. The 39% who care about sourcing represent a prime audience tuning in to authentic brand narratives.

2. A tail of two consumers: While the upper class is experiencing a historic increase in their investment portfolio, leading to financial confidence and healthy holiday spending, many people are dealing with uncertainty and tightening their purse strings on discretionary items. In fact, 75% of respondents said that recent trade policies and tariffs (such as import taxes on goods from other countries) are influencing their overall spending—with 32% delaying product purchases until there’s some stabilization. This all influences the recent ~30% year-over-year decline in consumer sentiment and reflects growing spending shifts, particularly among the Boomer and Gen X demographics.

How to win: Capture attention through precision targeting, not broad messaging. Analyze customer data to identify confident versus cautious spenders, then develop parallel campaigns—exclusivity for the confident, smart value for the cautious. Those 32% delaying purchases aren’t tuned out; they’re waiting for the right moment.

3. Scarcity drives demand: Only 16% of retailers we surveyed in the spring are willing to lower profits, so that means margins will be managed more closely than ever before. A key lever to pull is merchandise. The industry is seeing more assortment rationalization and shallow allocation than typical to lower inventory risk and carrying costs. I wouldn’t be surprised if we see in the neighborhood of 20% less product on the sales floor. Why risk customer satisfaction? Retailers would rather be out-of-stock than sit on piles of inventory that require deep markdowns to sell through it.

How to win: Turn scarcity into a competitive advantage for attention. Reframe limited inventory as curated exclusivity. Use waitlists to maintain engagement when items sell out, and leverage customer data for compelling cross-sells that feel personalized, not desperate.

4. Discount chicken is back: What will promotions look like this holiday? It’s not a question about if retailers will be more or less promotional than last year, it’s a question of when will the promotions be played. While retailers will once again try to squeeze out margin, consumers will likely be patient and win the game. Here’s the likely anatomy of the season:

• Retailers will hold off on deep discounts through September and October—aside from the annual PrimeDay event where many will draft off of the increased awareness and demand that the manufactured holiday creates.
• Retailers will get nervous that their runway is closing and become very promotional as CyberWeek approaches. This won’t necessarily include higher discount rates than last year, but certainly a heavy promotional cadence.
• As the holiday weekend comes to an end, and with five fewer days between Thanksgiving and Christmas, retailers will be under pressure to lock in transactions, particularly before the shipping cutoff date for online orders.

How to win: Win through timing and relevance, not deeper discounts. Create VIP early access for loyal customers and use purchase history to identify who waits for sales versus who buys at full price. With five fewer shopping days, start urgency messaging earlier—but make it feel exclusive, not panicked.

5. Personal agents become a shopping mall: Consumers will ask ChatGPT, Perplexity, and Claude for gift ideas this holiday. Our research shows that one-third of people are using these personal AI agents today to research, discover, and ultimately buy products and services. Similar to shopping malls, these destinations provide convenience, assortment, and ease. Personal agents can also provide memory and context, similar to great store associates who remember loyal shoppers and understand their intent. Will brands be discoverable where consumers are finding inspiration during the most important time of year?

How to win: Be where attention is shifting: AI recommendation engines. Optimize product information across all touchpoints so AI can easily find and recommend your products. Think of this as the new way consumers discover brands when they’re actively seeking solutions.

We continually talk to our clients at Cordial about the fact that the holiday season ahead will reward retailers who understand that winning isn’t about shouting the loudest—it’s about staying tuned in to what consumers actually want and delivering it with precision. As consumers become increasingly selective about where they spend their attention and dollars, the brands that succeed will be those who earn engagement through relevance and ease. The battle for attention is intensifying, but the smartest retailers will win by fighting smarter, not harder.