Editorial
The Gist
- Economic divide widens. The top 10% of U.S. earners now drive nearly half of consumer spending, forcing brands to tailor messages based on income tiers and price sensitivity.
- Inflation hits hard. With real spending projected to drop 4.3%, marketers must focus on value — using smart discounting, loyalty perks and private-label positioning to protect margins.
- Tariffs reshape perception. Rising import costs make “Made in the USA” messaging newly relevant as consumers brace for higher prices.
- Trust in influencers declines. AI-generated “slop” and paid promotion fatigue are eroding social media credibility, prompting brands to pivot toward reviews, referrals, and trusted media.
Every holiday season brings its own unique challenges. Here are four of the biggest ones affecting the 2025 holiday season and how marketers can adapt to those challenges.
Table of Contents
K-Shaped Economy
In 2021, the US experienced a K-shaped recovery from the pandemic, where certain industries thrived (think: anything online) and others struggled (think: restaurants and travel). The economy has gone K-shaped yet again, but this time the divergences are income-based rather than industry-based.
As of the second quarter, households with incomes in the top 10% were responsible for 49.2% of total consumer spending, according to Moody’s review of Federal Reserve data reported by The Wall Street Journal. That’s the highest it’s been since 1989 and well above the roughly 35% level seen in the early 1990s, according to Bloomberg. Moreover, the spending of the wealthiest 20% of Americans is significantly outpacing inflation, while everyone else’s spending is just keeping up with inflation, says Fortune.
Implications for marketers: Depending on your customer demographics, your brand may need to message very differently this holiday season. If your customers are largely wealthy, few adjustments will likely be needed. However, if your customers generally aren’t wealthy, then you should explore messaging you might use during a recession. And if your customer base spans the full socioeconomic range, you’ll want to do some segmentation based on spending levels, propensity to buy full-price items, sale sensitivity, and other factors so you’re addressing the needs of your customers across the income spectrum.
Related Article: Messaging During Recessions: 3 Opportunities for Marketers
Inflation Untamed
Consumers plan to spend $890.49 per person on average this holiday season on gifts, food, decorations, and other seasonal items, according to the National Retail Federation’s 23rd annual holiday consumer survey. The amount is 1.3% less than last year’s record of $901.99.
However, if inflation continues at the September level of 3% year over year, as it’s expected to, then inflation-adjusted spending is set to fall 4.3% compared to last year. That’s a significant decline.
Implications for marketers: To maintain margins, brands should lean into strategic discounting, as well as boosting value perception by, for instance, highlighting private label goods and positioning items next to higher priced items of the same type. Use exclusive discounts as signup rewards to build your email, SMS, and push promotional channels, as well as your loyalty program. All of your opt-in marketing channels should be positioned as the best way to get the best value.
Related Article: 4 Ways to Boost Digital Marketing Margins When Discounting
Tariffs & Buying Local
Tariffs have been a key driver of inflation all year and will remain a key concern among consumers. According to the National Retail Federation, 85% of consumers anticipate higher prices this holiday season because of tariffs.
Implications for marketers: For some American consumers, “Made in the USA” will read as less expensive. Test into promoting locally made products.
Related Article: How Tariff Messaging Can Make or Break Brand Loyalty
Social Media Influencers & AI Slop
In a dramatic reversal from recent years, social media is now the least trusted source when consumers make buying decisions, followed closely by celebrities, experts, and influencers, according to McKinsey & Co.’s State of the Consumer 2025 report.
“Consumers increasingly know that many influencers are paid,” says Kari Alldredge, a partner at McKinsey and co-author of the report. “They also believe that many influencers aren’t even real. In the world of beauty or fashion, consumers understand that many of the images they see are AI-generated, so they’re increasingly distrustful of that information.”
The pullback of Meta and other platforms from fact-checking has coincided with a proliferation of bots and AI slop. As anticipated, that combination is making social media a less attractive place for consumers and brands.
Implications for marketers: As recommended by McKinsey, brands should consider shifting some of their marketing and advertising budgets away from social media. Consider highlighting other forms of social proof, such as online reviews; encouraging referrals and other forms of word of mouth; and moving budget into traditional media, which has rebounded in terms of trust.
Webinar
Nov
6
Fix the Content Bottleneck: Build a Better WebOps Strategy
Content stalled? Dev overloaded? You’re not the only one. Learn how streamlined WebOps bridges the publishing gap.
Register
Webinar
Nov
13
Know Your Caller Reputation: How to Protect Your Brand and Get More Calls Answered
80% of unidentified calls go unanswered. See why your calls aren’t getting through.
Register
Webinar
Nov
20
How to Build a Solid Knowledge Foundation for AI Success
See how leading brands keep their AI honest, compliant and actually helpful.
Register
Webinar
Dec
2
From Manual to Magical: How AI Transforms CX Teams
Learn how to replace manual support processes with automation that actually delivers.
Register
Webinar
Dec
9
Rebrand. Migrate. Optimize. How to Do It All (Without Slowing Down)
Cresta leveled up site speed, design flexibility and marketer sanity (in record time). Find out how.
Register
Webinar
On demand
Beyond Storage: Smarter Content, Bigger Impact with DAM + AI
Discover how the DAM + AI duo makes content smarter, stronger and more accessible.
Watch Now
Related Article: X, Meta and the Great Social Media Meltdown
As in past years, marketers should leverage lessons and successful campaigns from previous holiday seasons. However, those lessons and campaign learnings should always be adapted to the context of the upcoming holiday season.
Learn how you can join our contributor community.
