The Gift List Is Shrinking—but the Celebration Isn’t: Where Holiday Spending Is Moving
For consumer packaged goods (CPG) brands and retailers, the holiday season has traditionally meant one thing: more shopping. But as consumers reassess budgets, rethink traditions and prioritize different experiences, the opportunity may be less about how much they spend overall and more about where their spending goes.
The latest holiday outlooks reveal contrasting spending patterns on either side of the border. Deloitte’s October 2026 US Holiday Retail Survey projects a 10% increase in holiday retail-goods spending, even as spending on holiday activities is expected to decline 4%. In Canada, PwC’s October 2026 Holiday Outlook reports that consumers plan to spend 11% less on gifts, travel and entertainment than in 2025. Together, these findings suggest that headline spending forecasts tell only part of the story: understanding which purchases consumers prioritize, postpone or abandon may be just as important as understanding how much they plan to spend.
For shopper and consumer insights leaders, these shifts raise a strategic question: are our existing assumptions about holiday demand keeping pace with how consumers are celebrating?
The holiday basket is changing
Holiday spending is often discussed in broad terms: consumer confidence, total spending forecasts and average budgets. These measures are useful, but they can obscure changes in the occasions driving individual purchases.
A shopper might buy fewer gifts but spend more on a holiday dinner. Another might skip an expensive present but purchase premium ingredients for hosting friends. A family could reduce spending on decorations while continuing to buy seasonal snacks, beverages and small treats.
The overall budget may be constrained, yet specific categories or occasions can remain resilient.
This distinction matters to CPG brands. A decline in discretionary spending does not necessarily mean every category faces the same pressure. The challenge is identifying which needs consumers are protecting, which they are simplifying and which they are willing to fund differently.
Three shifts worth investigating
1. From more gifts to more meaningful occasions
Experiences, gatherings and shared meals can compete with traditional gift purchases for consumers’ time and money. As holiday rituals evolve, products that help people host, share or create a memorable occasion may serve needs beyond their usual category role.
For example, a food product may be purchased not simply for everyday consumption but because it helps make a gathering feel special. A beauty item could become an affordable gift, while a premium snack might serve as a host gift or an addition to a celebration.
The research opportunity: Understand which occasions are growing in importance and how product needs change within them. Are consumers buying different products, choosing different pack sizes or seeking different benefits for the same occasion?
2. Trading down in one place to trade up in another
Consumers rarely make every purchase decision in isolation. They make trade-offs across the basket.
A shopper may choose a lower-priced everyday product to make room for a premium item for a holiday meal. Another may select a smaller package but remain loyal to a preferred brand. These behaviors can be missed when analysis focuses only on average price paid or total category expenditure.
For insights teams, the opportunity is to investigate the logic behind these trade-offs.
The research opportunity: Identify what shoppers consider essential, where they are willing to compromise and what still justifies a premium. Price sensitivity is important, but so are quality expectations, brand trust, convenience and the emotional role of the purchase.
3. The same product, different mission
A holiday shopping trip is not a single, consistent behavior. Consumers may make a planned stock-up trip, shop for a specific gathering, pick up a last-minute gift or make an unplanned purchase while browsing seasonal displays.
The same shopper can approach the same category differently depending on the mission. A familiar brand may be the default choice for routine replenishment, while a seasonal product or premium alternative becomes more appealing when the purchase is intended for guests or gifting.
The research opportunity: Explore how purchase criteria change across occasions and missions. Understanding those differences can help brands refine assortment, messaging, packaging and in-store execution rather than relying on one broad holiday shopper profile.
Move beyond the average holiday shopper
These shifts highlight a limitation of relying exclusively on overall spending forecasts or demographic segments. Two consumers of similar age and income may have very different priorities, even when their total holiday budgets look alike.
The more useful question is what each shopper is trying to achieve—and what trade-offs they are prepared to make to achieve it.
Combining purchase data with behavioral research can help reveal the motivations behind observed changes. Sales data may show that a category is growing or declining, but research can investigate why shoppers are changing their choices, which occasions are influencing them and what might encourage a different decision.
For CPG and retail leaders, these insights can inform more than holiday campaigns. They can shape innovation priorities, seasonal assortment, packaging decisions and plans for the year ahead.
Find the opportunity behind the spending shift
The holiday season is not simply a test of how much consumers are willing to spend. It is an opportunity to understand what they value enough to keep buying—and where their needs are changing.
Brands that recognize these shifts can make better-informed decisions about which occasions to target, which product propositions to strengthen and where to focus investment.
Want to uncover what is driving holiday shopper decisions?
Explorer Research helps CPG brands and retailers understand the behaviors, motivations and decision processes behind shopper choices. Through shopper research, eye tracking and immersive retail testing, we help teams investigate purchase occasions, evaluate product propositions and identify opportunities to improve performance.
Contact Explorer Research to explore how a deeper understanding of holiday shopper behavior can help your team identify emerging needs and make more confident decisions about future growth.
