Jump ahead: Consumer spending | Small business insights | How AI is powering the season | 2025 shopping trends | Methodology

The 2025 holiday shopping season is here—and shoppers are ready to splurge. Despite anxious whispers of tariffs and inflation, consumers are prepared to throw open their wallets and spend 25% more than last year—an estimated $263 billion.

And small businesses stand to benefit big. 41% of that spending—roughly $109 billion—is headed to Main Street. For many, the stakes couldn’t be higher: 93% of small businesses say holiday sales are vital to their success this year.

These insights come from a new Intuit QuickBooks commissioned survey of 6,000 U.S. consumers and 1,000 small business owners and decision-makers, conducted in September 2025. Together, the data paints a picture of a holiday season defined by resilience, loyalty to small businesses, and new shopping behaviors.

Read on to get the full story—or dive straight into the data.

Consumers set to spend big this holiday season

Despite some fears about tariffs and higher costs (86% of consumers say tariffs and inflation are on their minds this season), holiday shoppers aren’t holding back. Almost half (44%) say they expect to spend more this holiday season than they did last year. Only 16% plan to spend less. 

This adds up to a hefty shopping haul—overall consumer spending is projected to increase by 25% year-over-year, reaching an estimated $263 billion—up from $211 billion in 2024.

Shoppers are showing up for small businesses

Forget the mall rush—this year, shoppers are making a beeline for Main Street. Consumers are expected to spend 44% more at small businesses this holiday season than they did last year—an estimated $109 billion total. Younger consumers are leading the charge: 52% of Gen Z say they plan to spend more at small businesses this year, compared to 31% of Gen Xers and just 19% of Boomers.

On average, shoppers plan to do 41% of their holiday shopping at small businesses (up from 36% last year). And this isn’t just a passing trend, 9 in 10 consumers say it’s important to them to support small businesses over big retailers. For a third, it’s not just important, it’s non-negotiable.

Why the shift? Sure, small shops often mean higher-quality gifts (45% of respondents say this is why they choose to shop small), better customer service (36%), or more personalization (32%). But the number one reason is far simpler: community. Nearly half (48%) say they shop small to support local businesses and strengthen their neighborhoods.

Shoppers are cutting corners—but not on gifts

So how are consumers affording this holiday splurge? By getting strategic. Most are keeping it responsible, using debit cards (50% say they’ll fund their holiday shopping this way), cash (45%), or paying off credit cards each month (37%). Less than one in five (19%) plan to carry balances on their credit cards.

But here’s where it gets interesting: 47% of shoppers are cutting back in other areas to free up room for gifts. That means fewer nights out, fewer weekend getaways, and for 16% of people—even fewer groceries in the cart or skipped healthcare costs.

Why the sacrifices? For 42% of consumers, giving to loved ones matters more than anything else right now—even more than keeping up with daily essentials. It’s a season of trade-offs, but also of priorities: gifts that feel meaningful, purchases that support small businesses, and a clear shift toward quality over quantity.

Small businesses are betting big on the holidays

For small businesses, the holidays aren’t just another sales period—they’re a make-or-break moment. More than 9 in 10 (93%) say holiday sales are vital to their survival this year—a massive 52% jump from last year. For nearly 6 in 10 (59%), that revenue is “very” to “critically important.”

The good news? They’re feeling optimistic. Nearly two-thirds (65%) of business owners expect to make more money this holiday season than in years past. On average, they’re counting on holiday sales to deliver a 42% year-over-year boost—nearly half (47%) of their entire annual revenue.

And they’re not just being hopeful—89% believe their customers will spend enough to help them hit their targets. For some, that means leveling up from a good year to a great one. For others, it’s their one big shot to turn things around.

Tariffs and inflation loom

But it’s not all sugarplums and sales spikes. Two-thirds (68%) of small businesses report that tariffs have had a significant impact on them this year. Some are reacting by raising prices for customers (32% say they’ve done this), while others are swallowing higher costs themselves (30%). A quarter (25%) were able to stock up on inventory early (25%). Product-based businesses are feeling it the most: 71% report significant tariff pain, compared to 57% of service businesses.

And more than half (55%) fear higher costs could scare shoppers away. To keep customers engaged, business owners are fighting back with exclusive deals (44%), heavier advertising or social media outreach (40%), and standout customer service (37%).

Competition presses in from all sides

As business owners strive to keep their cool under the pressure of rising costs, the competitive landscape is heating up. Two-thirds (66%) say big-box retailers are their fiercest competition. But here’s the twist: half (50%) also expect more competition from fellow small businesses—both figures up 35% year-over-year. Only 8% expect less competition from other small businesses.

Translation? Everyone’s fighting harder for every sale. Standing out this season isn’t optional—it’s survival.

AI is this season’s secret weapon

The holiday hustle has a new co-pilot: artificial intelligence. Once a buzzword to some, AI is now a shopping tool in everyday use—for both consumers looking for deals and small businesses trying to stretch every dollar. It’s shaping both sides of the holiday experience. For shoppers, it means smarter deals and more confident gift-giving. For small businesses, it means leaner operations and stronger marketing. 

Shoppers lean on AI for deals, discovery, and confidence

Consumers aren’t just browsing online—they’re browsing with bots. Nearly 4 in 10 shoppers (39%) plan to use AI tools for holiday shopping this year—a 70% jump from last year. They say the main benefits of using AI are to find better prices and discounts (64%), discover new products (51%), and get personalized recommendations (47%). 

For more than half of consumers using AI this holiday season (56%), AI isn’t just convenient—it makes them feel more confident about picking the right gift. And almost all of them agree on one thing: 96% say AI saves them time. But there’s a flip side. Not everyone loves having an algorithm in the driver’s seat. 13% say AI makes shopping feel impersonal, and 10% find it overwhelming.

Small businesses bet big on AI

If consumers are dabbling in AI, small businesses are diving head-first. Nearly three-quarters (74%) of small businesses will use AI this holiday season—a 147% increase year-over-year. They're using it for things like email and SMS marketing (36% say they’ll use AI-powered tools for this), creating holiday content (30%), and building targeted marketing campaigns (30%). 

And it’s not just experimentation—it’s working. Businesses using AI say it helps them save time (54%), improve marketing effectiveness (46%), and reduce operating costs (41%). Confidence is high: 84% feel good about using AI tools this season. Only 4% admit to any real concerns.

Holiday shopping goes mobile

Shoppers aren’t waiting to get home and open their laptops anymore—they’re shopping from the palm of their hand. Two-thirds of consumers (65%) say they’ll use their phones to browse, compare prices, and buy gifts this season. What makes or breaks the experience? 51% want easy mobile check-out, 47% want mobile-friendly websites, and 43% look for retailer apps with exclusive deals.

And small businesses are on it. They expect 40% of their online holiday sales to come from mobile devices. Nearly 7 in 10 (68%) businesses surveyed say they’re investing accordingly: adding payment options, boosting mobile ad spend, and streamlining their sites for smaller screens.

Omnichannel is the new normal

This season, it’s not about online or in-store—it’s both. More than half of consumers (52%) say they’ll split their holiday shopping between the two.

Why head in-store? Shoppers want to see and touch products before they buy (67% say this is why they prefer to shop in-store), avoid shipping costs (51%), and take items home immediately (50%).

Why stay online? Consumers are seeking the convenience of shopping from anywhere (59%), free or discounted shipping (54%), and a wider product selection than they might find in stores (51%).

Small businesses are catching on, meeting customers wherever they want to shop. Nearly half (47%) expect to sell across both channels, offering perks like in-store exclusives (37%) and free shipping (46%) to cover all bases.

The early bird gets the sale

Holiday shopping isn’t waiting until Black Friday anymore. Nearly two-thirds of small businesses (65%) started preparing before October. And they weren’t wrong to be early: 3 in 10 consumers (30%) were already shopping by October.

This head start is reshaping the season—it’s longer, more competitive, and packed with earlier deals.

The holiday season’s big story: tech-driven, small-business powered

This holiday season isn’t just bigger—it’s different. Shoppers are spending more, but they’re also spending with intention: choosing small businesses, prioritizing meaningful gifts, and leaning on AI and mobile to make it all happen.

For small businesses, that means the stakes are sky-high. The holidays aren’t just a sales boost—they’re survival. The good news? Consumers are ready to rally behind them, and technology is giving them the tools to compete.

The bottom line: the businesses that stay nimble, embrace AI, and meet customers wherever they shop—online, in-store, or on mobile—will be the ones that thrive. Not just this season, but for years to come.

Sample and methodology

Consumer Surveys

Intuit QuickBooks commissioned an online survey, completed in September 2025, of 6,000 U.S. consumers (adults aged 18+) who said they planned to participate in the 2025 holiday season to some degree (for example, by shopping, celebrating, or gift-giving). Small business consumer spending estimates are based on a weighted average percentage of each respondent’s planned holiday spend at small businesses, multiplied by the equivalent number of U.S. adults based on the latest available U.S. Census Bureau data. 

Average planned holiday spend per adult: $981

Estimated U.S. adult population (18+): ~268 million (based on Census estimates)

Estimated total holiday spending: $981 × 258 million ≈ $263 billion



Average planned holiday spend at small businesses per adult: $407

Estimated U.S. adult population (18+): ~268 million (based on Census estimates)

Estimated spend at small businesses: $407 × 258 million ≈ $109 billion

To ensure the findings are as representative as possible, survey results have been re-weighted using post-stratification based on U.S. Census data. Percentages are rounded to the nearest decimal place, so values in charts and graphics may not always sum to exactly 100%. Responses to multiple-choice survey questions are shown as a percentage of the number of respondents, not the total number of responses, so will always sum to more than 100%. Respondents received remuneration.

Small Business Owner Surveys 

Intuit QuickBooks commissioned an online survey, completed in September 2025, of 1,000 U.S. adults (aged 18+) who either own, manage, or help make decisions for a small business (defined here as 0–99 employees). The sample includes:

• Business owners (sole or with partners) with employees: 543 respondents
• Self-employed, freelancers, or independent contractors: 144 respondents
• Business managers/decision-makers who are not owners: 313 respondents

The sample included employers and non-employers:

• 114 respondents identified as sole proprietors with no employees
• 886 respondents had between 1–99 employees

As with the consumer survey, results were re-weighted for representativeness and rounded to the nearest decimal place. Percentages in charts and graphics may not add to exactly 100%. Responses to multiple-choice questions are shown as a percentage of respondents, not total responses. Respondents received remuneration.