Average holiday budgets in US drop 10.2% in 2025: JLL

In a recent insights report, the Chicago-headquartered global real estate services company said as American households dramatically scale back their spending plans this year, and average holiday budgets have dropped by 10.2 per cent from $1,261 to $1,133 per person, marking a significant retreat from last year's more optimistic spending levels.

“This pullback represents more than just belt-tightening. It signals a shift toward more thoughtful, strategic holiday spending. Consumers are no longer willing to stretch their finances for holiday excess, instead choosing to focus their limited resources on what truly brings joy during the season,” JLL said in a release.

Spending patterns during the 2025 holiday season reveal a deeply divided consumer landscape. Higher-income households earning over $150,000 are actually increasing their planned spending by 26 per cent to $1,963, while lower-income households under $50,000 are cutting back severely to just $699—a steep 24 per cent decrease from $915 last year.

This growing divide indicates a holiday season that's increasingly bifurcated: budget-conscious and constrained among lower earners, but indulgent and experience-focused at the top, JLL noted.

A notable 25 per cent of American shoppers plan to skip personal purchases entirely, up significantly from just 17.3 per cent last year.

Meanwhile, spending on gifts for others remains virtually unchanged at $580 compared to $582 last year, demonstrating that the spirit of giving endures even as discretionary spending wanes.

Despite the continued dominance of e-commerce, the 2025 holiday season confirms that physical retail remains central to the American shopping experience. Only 16.3 per cent of consumers plan to shop exclusively online, meaning over 83 per cent will incorporate physical stores into their holiday journey in some capacity.

Nearly three-quarters of consumers plan to use multiple channels to complete their holiday lists, though enclosed mall shopping has declined to 49.9 per cent from previous highs.

The data reveals that while online ordering for home delivery captures 83.9 per cent of consumers, the vast majority still value the tangible experience that physical retail provides, whether for browsing, immediate gratification, or the social aspects of holiday shopping, JLL said.

Economic pressures are driving consumers toward value-oriented, efficient shopping destinations over more premium retail experiences. Mass merchandisers bounce back to capture 62.2 per cent of holiday shoppers' plans, reclaiming their position as the most popular shopping destination after falling in popularity last year.

This resurgence reflects consumers' demand for competitive pricing, extensive product selection and convenient one-stop shopping experiences.

While department stores maintain strong appeal at 50.4 per cent of shoppers, their relative position has been weakened by this mass merchandiser revival.

Consumer shopping behavior has become notably more concentrated and strategic, with 46 per cent of shoppers planning to visit just three to five stores to complete their holiday lists. An additional 13.2 per cent plan to visit only one to two stores, meaning nearly two-thirds of shoppers will finish their holiday shopping with five or fewer retail stops.

Social media has permanently embedded itself into the US holiday shopping process, with 79 per cent of consumers turning to various platforms for inspiration and guidance.

Platform preferences reveal distinct generational divides: Gen Z overwhelmingly favors TikTok at 46.2 per cent for dynamic, video-based product showcases, while Millennials display more balanced usage across Facebook, Instagram and X.

Among Baby Boomer shoppers over 60, while 57.9 per cent completely avoid social media for holiday inspiration, those who do engage predominantly choose Facebook and Instagram.

ALCHEMPro News Desk (DS)