Shoppers are spending more, and Main Street is getting the biggest slice yet

According to the survey, consumers plan to spend $278 billion this holiday season, a 5.7% jump from last year's estimated $263 billion, and a big leap from the $211 billion we predicted they’d spend in 2024. That’s three years of steady, compounding growth, right when a lot of forecasters expected shoppers to pull back.

Small businesses are the ones benefiting most from that growth. Survey respondents say 43% of their holiday budget, on average, will go to small businesses this year, up from 41% in 2025 and 36% in 2024. Against total spending, that works out to roughly $118 billion headed to Main Street: an 8.3% increase over last year.

That's the headline. But not every shopper is walking into the season the same way, and looking closer reveals two different stories underneath that $278 billion number.

Younger shoppers are anxious, but they're still showing up

Gen Z and Millennial shoppers are both significantly more anxious about job security this season than Gen X and Boomer shoppers: 64% of Gen Z and 59% of Millennials say they're at least somewhat concerned, compared to 53% of Gen X and just 28% of Boomers.

Younger shoppers are also more worried about rising costs in general, with 70% of Gen Z and 65% of Millennials concerned about inflation or tariffs hitting their holiday budget, compared to 55% of Boomers. They're more likely to say holiday spending will force them to cut into essentials like groceries or bills, too (18% of Gen Z, versus just 10% of Boomers). Younger shoppers, generally earlier in their careers and with less saved up, may simply have less room to absorb a shakier-feeling job market.

That anxiety isn't holding them back, though. Gen Z and Millennial shoppers are far more likely than Gen X and Boomers to say giving to family and loved ones matters more to them this year than in years past: 62% of Gen Z and 49% of Millennials, compared to 35% of Gen X and 23% of Boomers. They're committed to showing up for the people on their list. They're just doing it with less cushion, which shows up clearly in how they're planning to pay: Gen Z and Millennial shoppers use Buy Now, Pay Later services at meaningfully higher rates than older generations (21% and 24%, respectively, versus 14% of Gen X and just 6% of Boomers).

For small business owners, that's a real signal. Younger, anxious-but-committed shoppers are still coming through the door, and offering flexible payment options at checkout may matter more for reaching them than any discount could.

Higher earners are cruising. Lower earners are stretching further to keep up

Income tells its own story this year, and it isn't simply a story about who's cutting back. Lower-income shoppers are actually the most likely of any income group to say giving to family and loved ones matters more to them this year than in years past: 46%, compared to 38% of middle-income shoppers and just 32% of upper-income shoppers. Financial strain doesn't seem to be shrinking how much this season means to them. If anything, it's the opposite.

That commitment comes at a real cost, though. Lower-income shoppers are nearly three times as likely as upper-income shoppers to say they'll cut back on essentials like groceries, utilities, or healthcare to afford this year's holiday spending (19% versus 7%). They're also picking up seasonal work or a side gig specifically to cover the cost, at more than double the rate of upper-income shoppers (15% versus 7%), and they're far more anxious about rising prices hitting their budget (35% very concerned, versus just 15% of upper-income shoppers).

Upper-income shoppers, by comparison, are largely insulated: 67% plan to pay off their credit cards in full each month, versus just 26% of lower-income shoppers, who lean on debit cards instead to keep tighter control of spending (63% versus 35%).

So the $278 billion topline is real, and it's genuinely good news. But it's carried disproportionately by shoppers who have room to spare, while the shoppers with the least room are stretching furthest, and paying a steeper personal cost, to make the season count just as much as everyone else.

Why shoppers keep choosing small business

Consumer loyalty to small business hasn't wavered. 89% of shoppers say it's important to support small businesses over big retailers this year, holding exactly steady with previous years.

That sentiment is translating into real spending intentions. According to the survey, 35% of shoppers plan to spend more at small businesses this year than last (8% significantly more, 27% somewhat more), while 56% expect no change and just 9% plan to spend less. That's roughly flat with last year.

The reasons why haven't changed much year-over-year. Shoppers say they choose small businesses for unique or higher-quality gifts they can't find elsewhere (47%), because they want to support their community (46%), and because of better customer service and expertise (38%). Convenience is rising too, cited by 33% of shoppers, up from 30% last year.

One channel is growing distinctly faster than the rest: shopping at small businesses through social platforms like Instagram and TikTok. 23% of shoppers say that's where they're most likely to buy from a small business online this year, up from 20% in 2025 and just 16% in 2024, the fastest growth of any online channel by a wide margin. For small business owners without a big marketing budget, that's a meaningful signal: a strong presence on social media may now be doing as much work as a business's own website when it comes to converting a shopper who wants to buy small.

AI keeps growing, and it's getting smarter about where it helps

AI isn't a novelty for holiday shopping or small business operations anymore. The survey shows steady growth in adoption for both shoppers and small businesses, alongside a much clearer picture of where the tools are actually earning their keep.

Shoppers are getting pickier about where AI helps

43% of consumers now plan to use AI tools this season, up from 39% last year and nearly double the 23% who did in 2024. Among shoppers using AI, the draws are mostly practical: finding a better price or discount (64%), saving time on the search (47%), discovering new products or retailers (46%), and getting more personalized recommendations (39%). About a quarter (27%) say it helps them feel more confident they're picking the right gift. And the payoff seems real: 96% of AI users say the tools save them at least some time this season.

Roughly a third of respondents (33%) say their use of these tools has increased compared to last year, a sign that for many, AI shopping isn't a one-time experiment but a habit that's sticking and growing.

But not everyone's on board, and it's not always about distrust. The single biggest reason shoppers give for skipping AI altogether is simply that they're not interested (55%), and 43% say they'd rather research and decide on their own. For a lot of people, part of the appeal of the holidays is doing that work themselves, the planning, the searching, the surprise, and no algorithm is going to take that over.

There's one line AI hasn't crossed for most shoppers yet: actually placing the order. Just 15% have let an AI assistant complete a purchase on their behalf, and half of all shoppers (50%) say they wouldn't be comfortable with that at all. Shoppers are willing to let AI help them decide, but they're not ready to let it buy.

Small businesses are leaning in, and getting more strategic

Small businesses are moving in the same direction, and faster. 76% now plan to use AI in their holiday operations, up from 74% last year. Among those using it, the mood is genuinely upbeat: 80% feel optimistic about using AI this season, 40% of them very much so.

The benefits they point to are concrete: saving time for themselves or employees (56%), improving marketing effectiveness (44%), improving customer service or response times (42%), and increasing sales or revenue opportunities (41%).

Small businesses are also starting to think about AI from the other direction: not just using it, but making sure AI can find them. 46% have already taken steps to make their business easier to find through AI-powered search or shopping tools like ChatGPT or Google AI Overviews, and another 33% are planning to. For a small business owner without a dedicated SEO team, that's a new front to think about heading into the season, one that barely existed a year or two ago.