CHICAGO — American consumers are entering the holiday season facing ongoing financial pressure. Still, most expect to spend about the same as they did last year, while many plan to buy more gifts, host more dinners, and attend more parties, according to new research from consultancy Kearney.
In its fourth-quarter briefing, *The layered consumer: how consumers stack decision drivers*, released Wednesday, the Kearney Consumer Institute—an internal think tank at the global strategy and management firm—reported modest year-over-year gains in nearly every holiday activity category.
The biggest increases were in the season’s most social activities. The share of consumers planning to buy gifts for others and host dinners or parties each rose 5 percentage points from last year, while attendance at parties and events climbed 4 points. Spending on decorating and travel each increased 3 points, and self-gifting edged up 1 point.
"Ready money and financial security are setting the mood this holiday season," said Katie Thomas, who leads the institute and wrote the report.
The report's most striking finding concerns where caution is concentrated. Rather than the lowest-income households, the historically stable middle segment of the so-called K-shaped economy—in which the fortunes of higher earners and everyone else have diverged—proved most guarded heading into the season.
"Consumers remain under financial pressure, but a significant majority plan to spend as normal," Ms. Thomas said.
How shoppers hunt for bargains differs sharply by generation and income. Among 18- to 24-year-olds, 64 percent said they would search for holiday deals on social media, an 8 percent increase from last year.
By contrast, artificial intelligence has yet to become a mainstream tool for finding bargains. The share of people using AI to find deals did not rise from a year earlier, a finding Ms. Thomas called "one surprise" in the data. Adoption also varies by income: 29 percent of households earning more than $75,000 a year reported using AI to find deals, compared with 17 percent of lower-income households.
Online, Amazon held on to its grip on shoppers. "Amazon remains both the default and the favorite among online shoppers, though retailer sites and apps have picked up significant usage," Ms. Thomas said.
The briefing also explored whom consumers trust for advice on health, hair care, and food and nutrition. In all three categories, credentialed authorities earned 50 percent of consumer trust, compared with 10 percent for AI.
Influencers fall into an awkward middle ground: more than half of consumers said they rely on them when making these decisions, but only 20 percent said they trust them.
"Trust follows accountability across all categories," Ms. Thomas said.
Younger consumers draw on a broader range of voices. The average number of trusted sources increases from nine among 55- to 64-year-olds to 13 among 18- to 24-year-olds. "Younger consumers are adding voices on top," she said.
Even as financial strain rises, everyday thrift appears to be softening. Consumers reported cutting back in all 10 spending categories the institute tracked, yet they are scrimping less than they did a year ago. Fewer said they were growing their own vegetables, shopping at thrift stores, cooking at home, or sticking to a budget.
For retailers, shoppers feel stretched but aren’t pulling back. They’re still willing to spend on gatherings and gifts, but are becoming more deliberate about where they shop and which channels offer the best prices.
