The Green Sheet Online Edition
October 26, 2026 • 26:10:02
Deals, digital tools, new habits shape projected $1 trillion holiday spend
Holiday shopping predictions are rolling in, and while most experts expect robust spending, some warn that inflation pressures and affordability concerns could dampen sales. Consistent with prior years, nearly all U.S. adults (91 percent) plan to celebrate winter holidays, including Christmas, Hanukkah and Kwanzaa, the National Retail Federation reported.
NRF estimated sales in November and December will grow 4.2 percent over 2025 to total $1.013 trillion. Last year during the holiday buying season, retailers saw sales rise 3.1 percent over 2024 to total $972 billion, NRF stated.
"This year's forecast reflects our confidence that consumers will prioritize the holiday season even as they remain mindful of their budgets," said NRF President and CEO Matthew Shay. The federation's forecast is consistent with a projection by the consultancy Deloitte, which predicts 4 percent year-over-year growth. Mastercard predicted the season will be one of the strongest in recent years, with retail sales, excluding automobiles and gas, expected to increase 5.5 percent year-over-year between Nov. 1 and Dec. 24. Mastercard said it expected in-store sales to grow 3.6 percent, which would be the strongest showing in four years.
Bright spot in economy
"We head into the holiday season with strong spending momentum, as consumers remain the bright spot in the economy," said Mark Matthews, NRF chief economist and executive director of research. "At the same time, inflation, rising gas prices and pressures on household spending will affect consumers differently across income groups."
NRF defines the holiday season as running from Nov. 1 through Dec. 31. Its forecast is based on economic modeling using indicators including consumer spending, disposable personal income, employment, wages, inflation and previous monthly retail sales. The calculations exclude automobile dealers, gas stations and restaurants.
NRF's forecast does not distinguish between online and in-store purchasing, Shay said during an Oct. 15 briefing with reporters. In an Oct. 20 press release, however, NRF stated that a consumer survey by Prosper Insights & Analytics found 53 percent plan to do at least some shopping online. Other major shopping destinations include grocery and discount stores (tied at 43 percent) and department stores (42 percent).
Shoppers seek more for their money
Affordability will help shape winter holiday shopping. Prosper found 43 percent of consumers plan to shop for sales more often, 31 percent will comparison shop online more often, and 29 percent will use coupons more often.
"With affordability top of mind, holiday shoppers are taking a thoughtful approach to spending, balancing value with preserving traditions that make the holiday season special," said Allison Zeller, NRF vice president for industry and consumer insights.
"From getting an early start to waiting for major deals and promotions, consumers are choosing when to shop based on what works best for them," said Phil Rist, Prosper executive vice president for strategy. "Even with a significant portion of shoppers beginning before November, many still plan to take advantage of deals and promotions during Thanksgiving weekend to make progress on their holiday shopping."
Online sales growth driven by mobile
Adobe predicted online holiday sales in November and December will exceed $275 billion. It also expects consumers to spend $95.8 billion online in October, up 8 percent over 2025, driven largely by Amazon Prime Day sales.
Adobe expects Cyber Monday (Nov. 30) to set a new milestone for U.S. ecommerce, with consumers spending over $15 billion online in a single day, up 6.2 percent over 2025. The second-biggest day of the season for online sales will be Black Friday, when consumers are expected to spend $14.9 billion at ecommerce merchants.
At 9.2 percent year-over-year growth, Black Friday is growing faster than Cyber Monday, Adobe said. Thanksgiving is expected to generate $6.9 billion in sales, up 8.5 percent, bolstered by impulse shopping.
A record 63 percent of online spending this holiday season is expected to come through mobile devices, Adobe said, up from 61.5 percent in 2025. Electronics ($63.3 billion) and apparel ($51.3 billion) will serve as "tentpole categories" for ecommerce, Adobe said.
Other categories are also projected to show strong year-over-year growth, including furniture ($33.4 billion, up 7.3 percent), grocery ($26.1 billion, up 10.3 percent), toys ($9.6 billion, up 9.6 percent) and cosmetics ($9.2 billion, up 9.5 percent).
Adobe, in a report released in September, said it expects competitive discounts online this holiday season. "Shoppers will see deals throughout the season, up to 14 percent in early November, up to 21 percent just before Thanksgiving and up to 10-15 percent throughout December," Adobe predicted.
While consumers historically have embraced holiday deals for gift buying, many are taking advantage of discounts to stock up on essentials, such as personal hygiene products, clothing basics, baby products, pet products and household cleaning items.
BNPL continues to gain traction
Buy now pay later will continue to gain traction among consumers during the holiday season. Adobe predicted the payment method will drive $21.3 billion in sales in November and December, a 6.6 percent year-over-year increase.
Usage is expected to spike on Cyber Monday, when BNPL will account for $1.09 billion in online spending. This would be the second consecutive year that BNPL spending on Cyber Monday exceeds $1 billion.
On Black Friday, BNPL is expected to drive $807 million in online spending. Adobe expects 82 percent of holiday BNPL spending to come through mobile devices.
Shopping with a little help from AI
No longer a novelty, AI is becoming part of consumers' holiday shopping routines. A study of more than 2,000 Americans, conducted by the Harris Poll for the trust intelligence platform Forter, revealed that two-thirds (67 percent) plan to use AI for holiday shopping this year, and 37 percent of holiday shoppers expect to use it more than last year.
AI's influence on shopping behavior is apparent, with 43 percent of Americans in the study having already discovered or purchased from a retailer they had never shopped with before because of an AI recommendation.
A survey of 1,500 American adults conducted by the consultancy Simon-Kucher revealed that 55 percent plan to use AI to find the best deals, and 51 percent will use it for comparison shopping.
"I've spent 25 years watching consumer behavior shift, from online to mobile to social, and each time retailers had months, sometimes years to adapt," said Jen Howard, chief merchant at Forter. "Our research shows that shoppers are already using AI to find deals, discover new brands and even check out. This traffic is arriving at merchants' sites this holiday whether or not they are ready."
Mastercard measured spending trends for "AI power users" — those with paid AI subscriptions — and found they spread their spending across a broader set of merchants, including smaller and boutique retailers.
The gift is the card
Gift cards will play a significant role this holiday season. A survey of just over 2,300 U.S. holiday shoppers by Blackhawk Network found 82 percent are setting holiday budgets. Among shoppers setting a budget, 93 percent plan to purchase gift cards, compared to 78 percent of shoppers without a budget.
"With everyday costs putting pressure on holiday budgets, shoppers are being more deliberate about how they spend," said Brett Narlinger, chief revenue officer at Blackhawk.
According to the 2026 Gift Card Guide, prepared by TSG and Bank of America, gift cards earn high satisfaction ratings and drive shopping in January and February. Eighty-seven percent of consumers surveyed who received gift cards in 2025 used at least half of them by February; 29 percent used almost all of them.
Shifting budgets, changing priorities
Consumers surveyed by Blackhawk plan to spend an average of $721 on holiday gifts, down 3 percent from last year, the company said. Market research firm Circana is less bullish than most in its assessment of the holiday shopping season, forecasting a sales change ranging from a 1 percent decline to a 2.5 percent increase.
Circana's survey of just over 3,500 consumers found holiday spending will average $779, with more than one in five planning to spend in excess of $1,000.
The consultancy characterized consumers' holiday budgets as being reprioritized rather than reduced.
Consumers are "becoming increasingly purposeful about where and how they spend," said Kiara Barrett, head of global thought leadership at Circana. "While affordability remains important, consumers continue to prioritize purchases that create meaningful moments, strengthen personal connections, improve everyday life or simply deliver a sense of joy."
Across the forecasts, sales growth and individual budgets tell different stories: retailers may take in more overall even as some shoppers plan to spend less. For many, the season will be shaped by the search for value and the traditions they hope to preserve. 
Patti Murphy is senior editor at The Green Sheet, president of ProScribes Ink (www.proscribes.net) and self-described payments maven of the fourth estate. Her Today in Payments reports are a regular feature of the Merchant Sales Podcast.
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