What executives expect for the holiday season

With Christmas Eve just two months away, retailers are gearing up to meet the demands of a more cautious shopper by offering earlier holiday deals. Most retailers will report their third-quarter results and updated holiday expectations closer to Thanksgiving, but many shoppers will have already started checking off their holiday shopping lists by then.

The holiday shopping season is expected to be highly competitive, with Amazon’s October Prime Day sales event and other retailers’ early Black Friday deals grabbing a significant portion of the holiday wallet share. This comes as executives point to a bifurcation in consumer spending, with lower-income consumers feeling the strain on their budgets due to factors like government shutdowns and tariff costs.

Kohl’s is among the retailers chasing holiday shopping early, with hopes of boosting their total haul. The company’s Chief Marketing Officer, Christie Raymond, stated that they want to drive early consideration and make sure they’re capturing shoppers not only early but often. To achieve this, Kohl’s is starting its holiday marketing campaign a week earlier than last year and will be breaking out the rest of its holiday merchandise in the coming days.

Shifting Shopping Habits

A key part of Kohl’s holiday strategy is to capture shoppers who make multiple trips to stores but check out with smaller baskets. According to a survey conducted by Kohl’s, shoppers made an average of 15-plus trips to stores across the industry between November and January but checked out with smaller baskets. This trend is expected to continue, with consumers being savvy about price monitoring and looking for the best deals.

Academy Sports and Outdoors CEO Steve Lawrence agrees that shoppers are price-conscious and expects customers to aggregate their spending around key shopping moments on the calendar where they know they can get the best deals. Both Kohl’s and Academy Sports cater largely to middle-income shoppers, and Lawrence notes that consumers are paying close attention to discount events, with higher take rates on promotions compared to previous years.

Cautiously Optimistic

Despite the challenges posed by inflation and tariff uncertainty, retail executives remain “cautiously optimistic” about the upcoming holiday season. Dick’s Sporting Goods Executive Chairman Ed Stack notes that the consumer is “a little bit stressed” this season but believes that providing value to the consumer, whether through innovation or price, will drive sales. Inventory positions for holiday are expected to be normal, despite concerns about tariff uncertainty affecting order volumes.

Executives for all three retailers agree that shoppers are resilient and will come out during key shopping time periods, such as holiday. To capitalize on this, retailers are focusing on offering value to consumers, whether through private brands, innovation, or promotions. Kohl’s, for example, is seeing shoppers reach for lower-price options and expects this trend to continue during the holiday season, with private brands offering a great opportunity to capitalize on this shift.