What holiday shopping tells us about 2025 spending trends

In October, we shared insights and predictions about retailer spending ahead of 2024 holiday shopping. Now that the season has wrapped, we can review year-end consumer data and consider what it may mean for the coming year. 

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The headline: U.S. consumer optimism and spending intent are generally healthy, with huge online sales during Black Friday and Cyber Monday (BFCM). However, economists see tentative warnings of a consumer spending slowdown in 2025. Here, we look at the data and how it may impact retail spend in Q1.

Cyber Monday was the biggest shopping day—ever

Cyber Monday broke records as the biggest shopping day of all time. U.S. consumers spent $13.3 billion online on Cyber Monday, up more than 7% year-over-year. During the peak hours of 8 p.m. to 10 p.m. Eastern Time, data indicates that consumers spent $15.8 million online every minute. 

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This spending may be a result of increased consumer optimism. According to a report from McKinsey, U.S. consumers felt more optimistic about the economy this holiday season. Optimism increased six percentage points from last year, the highest it’s been since the start of the COVID-19 pandemic. While the report also notes that fewer Americans intended to splurge this year, this clearly didn’t impact sales on Cyber Monday.

In-store shopping declined as e-commerce and mobile sales soared

This news isn’t surprising. E-commerce sales have consistently risen year-over-year in the last 10 years and are forecasted to rise another 39% by 2027.

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According to data published by Forbes, in-store Black Friday shopping dropped by 8%, while online sales increased by 10% over last year. 

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Using Adobe Analytics data, retail publication CSA reported that over half of BFCM online sales came from mobile purchases, up 13% year-over-year. Over 75% of “buy now, pay later” (BNPL) purchases—accounting for nearly $1 billion in sales on Cyber Monday alone—were done on a mobile device.

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This year, AI emerged as a major contributor to online sales. Consumer GenAI tools like Open AI’s ChatGPT and Anthropic’s Claude drove 1,800% more traffic to retail sites than last year. Additionally, as we reported in October, e-commerce retailers are increasingly investing in AI customer service chatbots. Salesforce data shows that retailers using chatbot tools on Black Friday saw a 15% higher conversion rate than those who didn’t.

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Middle-income earners spent more, while high-income consumers spent less

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Bain & Company reported that this holiday shopping season was better overall than last year. However, spending was distributed differently across socioeconomic demographics—which could tentatively signal a warning for the economy.

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Spending intent among middle-income earners ($50-100k) jumped 7.8 points in the Consumer Health Indexes (CHI), continuing a trend that began mid-2024. However, because debt among this group is trending upward, increased spending may not be a good thing. It suggests that more middle-income consumers intend to use debt for purchases, which worries economists.

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Meanwhile, spending intent among upper-income earners ($100k+) dropped by 3.2 points in the CHI. This group accounts for most discretionary spending, so economists are concerned this drop may signal a slowdown in consumer spending before Spring.  

What it could all mean for retailer spend

Based on our earlier data and what we now know about consumer spending, we have hunches about what we’ll see in Q1 2025.

Ramp’s 2025 retail spend predictions:

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• Spending on AI tools will continually increase. Given the proven impact of AI chatbots on conversion rates during BFCM, we expect retailers to continue adopting and implementing these tools.

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• Retailers will invest more in e-commerce offerings, including mobile optimization, BNPL features, and blending of online and in-store experiences. 

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• Ad spend will continue to focus heavily on digital channels. We expect retailers to continue prioritizing advertising generally, but if a consumer spending slowdown occurs, retailers may become more conservative with their advertising dollars. We’ll keep an eye on this—only time will tell.

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