Personalization Powers Holiday Sales Surge, But 69% of Shoppers Plan Spending Cuts in 2025

New consumer research reveals that while 37% of shoppers are buying more frequently due to personalized recommendations, a significant pullback is expected next year

As brands and retailers race through the busiest quarter of the year, Salsify and the Digital Shelf Institute’s (DSI) Ecommerce Pulse Report offers critical insights into consumer behavior in Q4 — and a glimpse of what’s to come in 2025. The report reveals that while personalization is fueling higher holiday spending, a looming shift in shopper behavior could challenge brands in the year ahead.

According to the report, based on a survey of over 1,000 shoppers in the U.S. and U.K., 37% are making more frequent purchases due to personalized recommendations, with Gen Z and millennials leading the charge. Fifty-three percent of Gen Z and 48% of millennials say they’re more likely to hit “buy” when shopping experiences are tailored to their needs. Yet, as we approach 2025, 69% of consumers are planning to cut back on spending — a wake-up call for businesses dependent on consumer confidence.

“We’re witnessing a tale of two trends,” said Salsify Research Director Dom (she/her) Scarlett. “Consumers are more engaged than ever when experiences are personalized, but the signs of belt-tightening are clear for 2025. The key for brands will be balancing personalization with a strong value proposition.”

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Holiday Spending Surge Driven by Personalization

The holiday season is traditionally a make-or-break time for retailers, and this year is no different. The report highlights that personalized shopping experiences — from custom product recommendations to tailored discounts — are driving higher engagement. Gen Z and millennials, in particular, are fueling this trend, seeking out brands that know them and cater to their unique preferences.

But it’s not just personalized offers capturing attention. Eighty-seven percent of shoppers say enhanced product content — detailed descriptions, comparison charts, and immersive visuals — helps them make purchasing decisions, signaling a need for brands to level up their digital presence.

2025: A More Cautious Consumer Requires a Conscious Shift, Shares Experts

While personalization is boosting sales now, the report signals caution ahead. Sixty-nine percent of shoppers plan to rein in their spending in 2025, with 82% of millennials leading the charge on financial restraint. This suggests that while personalization will remain important, brands must shift as necessary through the holidays and beyond, emphasizing value and utility to stay relevant.

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“Shopper intent changes from early- to mid- to late-season,” said Lindsey Simcik, Digital Content Sr. Manager for Mars United Commerce, and member of the DSI community, who contributed to the report. “Consider how your brand and category are relevant based on the shoppers’ mindset throughout. Then, plan your activity and budget to maximize the opportunity. That might mean launching a campaign mid-week versus on the retailer’s established cadence, or it might mean revising your secondary PDP image for a different occasion mid-season.”

Additional findings from the Ecommerce Pulse Report:

• Boomers Primed for 2025 Spending, But Data Privacy Concerns Loom: Boomers are set to lead the way in spending, with nearly 60% planning no cutbacks in 2025. However, their enthusiasm for personalized shopping may be tempered by growing concerns over data privacy, with boomers (28%) more worried about data usage than millennials and Gen Xers (both 17%) and Gen Zers (15%).
• What Matters Most on Product Pages: When it comes to irresistible buys, what grabs shoppers’ attention most? Customer ratings and reviews reign supreme at 25%, outshining even product images and videos (22%), and, despite spending concerns, pricing and availability (19%), asserting the importance of high-quality content.
• Increased Retailer Network Usage: With 38% of shoppers regularly purchasing from four to six different online retailers, brands need to spread their wings across multiple platforms to tap into a wider, more diverse customer base.