In an early forecast on holiday spending, business services firm Bain & Co. stated it expects November/December retail sales in the United States to increase by 4.5% year over year and top $1 trillion for the first time.
The 4.5% growth predicted would top the 3.5% year over year rise recorded for the 2025 holiday season. Bain tempered the overall upbeat quality of its holiday retail outlook by noting that more than half of the nominal sales growth will come from higher inflation. Still, it’s worth noting that 2025 growth was inflation impacted as well.
Further, Bain reported it expects 70% of the holiday season sales to occur in brick-and-mortar stores, yet it sees most revenue growth coming from non-store spending. Bain’s analysis indicates non-store retail sales will grow 9% year over year, accelerating versus the 2025 holiday season as non-store generates 60% of overall sales growth, up from 50% in the year-past period. Bain expects in-store sales gains to continue in line with last year’s 2.5% year over year growth, with the strongest performance predicted to come from the clothing and accessories, health-related and personal care products. In a Bain survey that contributed to its forecast, consumers said they expected clothing to overtake groceries as their highest-spending category in the holiday season, with gift cards coming a close third.
Men, highe-income earners and younger consumers are most likely to spend more money in the holidays. At the same time, consumers are more apt to start online holiday shopping on AI platforms such as Claude, Google Gemini and ChatGPT, at 24% versus 17% in 2025, and on retail and brand websites, at 60%, up from 51% year over year. When considering shopping on retailer and brand sites, 13% of consumers said they intend to use available AI agents.
In unit terms, Bain anticipates that general merchandise, clothing and accessories, and e-commerce will enjoy price and unit growth as furniture and home furnishings, electronics and appliances, and food and beverage remain consistent with holiday 2025.
According to Bain, holiday headwinds retailers face include cautious consumers whose spending power has been pressured by still-elevated gasoline prices, as well as the impact of tariffs; geopolitical uncertainty; labor market participation at a five-year low despite a stable national unemployment rate of 4.1%; and lesser personal savings rates compounded by credit card delinquency above the 10-year average.
However, Bain pointed out, several factors should support nominal sales growth, including higher tax refunds that look to be up $43 billion from last year, higher stock prices buoying the outlook of upper-income households and plans by some retailers to pass on tariff refunds to shoppers in the form of price cuts.
“While U.S. retailers have reason to rejoice this holiday season as the industry reaches the trillion-dollar milestone for the first time, there are underlying factors that will temper bottom lines,” said Aaron Cheris, partner at Bain & Company and global head of the firm’s retail practice. “The key for retailers is to make the most of the crucial holiday season by striking the right balance when it comes to price and promotions, and making the most of new AI capabilities to enhance the customer experience and get ahead of competitors.”
