Consumers are expected spend more on holiday shopping this year—as usual—but much of that apparent gain will be offset by inflation.
Shoppers plan to spend an average of $736 on holiday gifts, according to data from Visa’s 2025 Holiday Spending Outlook. Nominal holiday spending is expected to reach 4.6%, but after adjusting for inflation, real growth is just 2.2%—down from last year’s 2.5% increase. In other words, inflation is driving most of the apparent sales growth this season.
To evaluate this trend, Visa developed a “holiday CPI,” a tailored index that reflects the typical basket of goods sold during the season. According to the index, inflation for holiday-related items is just slightly below the overall inflation rate. Prices for recreational goods, which make up about 30% of the holiday CPI basket, are up 3.1% over the past year.
The good news for retailers: despite inflation and waning consumer confidence, shoppers are still spending. In April, consumer confidence fell to its lowest level since the pandemic, yet Visa reports that real spending growth continued to rise, reaching 2.7% in August, the latest month with available data.
In a potentially related development, the holiday shopping season is kicking off earlier than ever, and Visa is now tracking it across the entire fourth quarter to capture the extended buying period. As a result, Visa found that more than 15% of consumers started their holiday shopping in September or earlier, with an even higher share among millennials. It found that more shoppers are looking to secure gifts before prices climb further.
At the same time, holiday spending continue to shift online, particularly to mobile devices. More than 45% of consumers say they plan to use their mobile devices for most or all of their holiday shopping, per Visa.
That aligns with an earlier forecast from Adobe for Business, which estimates that mobile revenue will reach a record 56.1% share of total holiday sales—the first time mobile will account for more than half of overall spending. Roughly $142.7 billion is expected to be spent via mobile this season, up 8.5% from last year, with seven in 10 online retail visits occurring on mobile devices.
