The content of this article is provided for informational purposes only. You should always obtain independent business, tax, financial, and legal advice before making any business decision.
Key Takeaways:
Shopping can be an involved experience today, and AI-powered shopping has already found its target audience. AI consumer trends prove that generative AI has embedded itself into nearly every consumer use case. However, AI-powered shoppers are even allowing it to make purchases on their behalf.
AI tools and agents help consumers compress research, personalize recommendations, and simplify the decision journey, especially during a busy holiday season.
AI-powered holiday shoppers don’t just ask ChatGPT or Gemini for gift recommendations. They brainstorm with AI, using it to discover relevant products and leverage its insights to buy personalized recommendations.
Impressively, 77% of consumers surveyed were planning to use AI for 2025 holiday shopping.2
This guide explores the AI consumer trends that impact your business and how you can leverage AI and consumer behavior to prepare for the holiday season.
Table of contents
Around 40% of Americans have used AI for a purchase in the past year. Gen Z and millennials lead the charge with 61% and 57% of them, respectively, relying on AI-powered shopping.2 Your potential customers use AI to find the best deals, compare products, and find gift ideas and personalized recommendations. The AI-powered shopper can be identified by a few telltale traits:
AI consumer trends show that shoppers use AI tools to do the heavy lifting of generating gift ideas, summarizing reviews, comparing features, and ranking products.2 Consumers are also going beyond simple searches in AI chatbots. They’re using AI agents to harness and condense massive amounts of information, refining it into personalized recommendations.
Value shopping is more relevant than ever, as economic uncertainties shift spending priorities. Shoppers are tracking prices, hunting for the best deals, and predicting if a price drop is imminent, all using AI tools. If your products aren’t appearing in AI searches and tools, you’re missing out.
Omnichannel is back as 64% of shoppers are considering in-store purchases this holiday season, with 41% planning to delve into both online and in-store shopping.2 AI shoppers are discovering products online, experiencing them in-store, buying them online, and picking them up offline.
Buy Now, Pay Later (BNPL) is becoming essential for modern shoppers rather than a novelty. Around 52% of shoppers are more likely to buy if BNPL is available, and around 50% plan to use it this holiday season.2 The flexibility and budget control offered by BNPL have become integral to how Gen Z and millennials pay.2
The AI-powered shopper isn’t going to wait around for lengthy and clunky checkout processes. They’ll bounce if they’re forced to waste time filling out personal and payment information or dealing with a crowded checkout page.
They expect fast authentication, flexible payment options, and transparent delivery timelines, something PayPal custom checkout integrations are built to offer.
These evolving AI consumer trends make it clear that sitting on the fence is no longer an option. Your consumers have integrated AI agents into their shopping workflow. It’s high time you invested in AI consumer products and made your site ready for the modern shopper as well as AI crawlers.
The holiday season is one of the busiest and most crucial periods for your business. With AI-powered shoppers making their preferences clear, you can’t afford to “wing it.” To prepare for the topmost AI consumer trends, it’s important to study the following trends and analyze what they mean for your business.
The AI-powered shopper uses AI tools as the starting point for their holiday shopping. Around 59% of consumers have used AI or plan to use it for shopping experiences.1
These shoppers use AI assistants to create gifting ideas, compare products based on personal preferences, and build gift lists for specific people. This personalized shopping experience has empowered the modern shopper like never before and raised their expectations to new heights.
What this means for merchants
Optimize your products for AI discovery to appear where the consumer is starting their shopping experience. This means tweaking product titles, descriptions, metadata, pricing and inventory information, and comparisons so that they’re AI-compatible. The idea is to prepare your site for AI-powered discovery engines, especially during the holiday shopping season.
Holiday shopping is no easy feat. It’s a time when decision fatigue is at its peak, and shoppers want hyper-personalized customer journeys. By narrowing the consideration set to a handful of relevant products and matching them to the shopper’s intent, AI tools reduced the cognitive load.
Personalization doesn’t just mean recommending similar items; it has transformed into AI-curated gift guides, product bundles, coupon codes, personal offers, and even dynamic pricing.
What this means for merchants
To prepare your store for the AI-infused holiday season demand, ensure detailed descriptions with natural language to help AI systems match your products to shopper intent. Your product information should be clean, consistent, and structured for easy parsing.
Lastly, enrich your product listings with authentic reviews, rich media, and up-to-date availability. PayPal’s fast, trusted, and secure checkout signals shopper confidence and brand credibility to AI systems.
Agentic AI isn’t a futuristic trend anymore. It’s here, and shoppers are using the tech to plan, execute, and track purchases. Rather than using AI chatbots for simple queries, consumers are relying on AI agents for discovery, evaluation, and even autonomous purchases while managing their holiday budgets.6
What this means for merchants
You need to ensure your product catalog integrates seamlessly with AI agents. This requires clean, structured, and updated product information that signals clear value propositions to AI tools, so that your products show up where your potential customers are searching. PayPal agentic AI and APIs can effectively expose your products to all relevant AI surfaces, reducing manual overhead.
The holiday season is usually when shoppers spend the most, and it can easily get overwhelming. Around half of the consumers plan to use flexible payment options like BNPL this holiday season, and 52% are more likely to buy if your store has BNPL options.2
In fact, around 25% of Gen Z and millennials use BNPL regularly, and 33% of them have tried it at least once.2 Your AI-powered consumers will appreciate it if you front-load the shopping experience with BNPL availability, helping convert those on the fence.
What this means for merchants
BNPL helps AI-powered shoppers keep their finances in check during peak spending periods. PayPal data shows that merchants using BNPL have seen an average order value increase of up to 91% and 62% higher average order value for large enterprises and small businesses, respectively.2
Promoting BNPL early and regularly during the purchase journey helps boost visibility for small businesses. You should display BNPL banners on product pages, category pages, homepage banners, and search filters.
The AI-powered shopper doesn’t just shop online. They move fluidly between channels and expect merchants to keep up.
AI-driven product discovery might happen online, but shoppers are increasingly valuing the in-store experience for evaluation and purchase. Around 64% shoppers plan to indulge in in-store shopping this holiday season, with 41% planning to club in-store and online purchases.2
What this means for merchants
As a merchant, you should try to offer a unified omnichannel shopping experience, especially during Black Friday doorbuster events and late-season pickup.
When shoppers land at your store for last-minute purchases, they expect their online preferences to be synced to your in-store systems. This is made possible by PayPal's network of 438 million active accounts, which provides a rich foundation for a unified omnichannel experience.3
AI-powered shoppers don’t splurge when they don’t have to. Around 74% of Americans are more likely to shop with you if you offer rewards and cash back.2 AI tools are more likely to rank merchants higher that offer opportunities to maximize value while encouraging customer loyalty.
What this means for merchants
Focus on clearly communicating your cash back and rewards programs so that AI agents can appropriately display them in search results and summaries. A unified online, in-store, and rewards experience is likely to foster lasting customer loyalty.
Despite rising AI adoption, data privacy remains a concern among consumers. Currently, only around half of the consumers trust AI for information collection.4
Holiday shoppers value clear information, authentic reviews, and transparent return policies. These are major factors in converting last-minute purchases.
What this means for merchants
You ought to ensure accurate product information, verified reviews, and simplified return policies on your website to provide strong trust signals to customers and AI tools.
If your data is accurate, then the information provided to shoppers through AI agents is more likely to convert into purchases, since shoppers won’t be met with rude surprises.
AI consumer trends aren’t limited to the holiday season. They represent a permanent shift in consumer AI and digital commerce. Merchants who adapt to this evolving landscape will benefit not just during the holiday season, but year-round.
With AI-powered shoppers no longer a minority, you should re-examine your entire product, marketing, and distribution stack to ensure it satisfies the demands of both the consumer and AI tools and agents. This will involve investing in AI for not just product discovery and marketing, but also omnichannel experiences and rewards programs.
If AI consumer insights have taught us anything, it’s that your product visibility on AI platforms is only as good as the accuracy of your product information. You need to ensure that your data is:
Incomplete, outdated, or inconsistent data will hurt your ranking in AI search results, summaries, and snippets, essentially making you invisible in a sea of competitors.
AI consumer trends are influencing merchant trends as well, such as using AI for small business marketing. Using Gen AI tools for image generation isn’t the be-all, end-all of AI-powered marketing.
You should explore personalized offers based on shopper behavior, tweak landing pages based on search intent, use A/B testing to test creatives in real time, and trigger promotions based on user milestones.
In the AI arms race, where your potential customers are adopting smart agents in droves, you ought to raise the stakes at your end. Static campaigns are obsolete; real-time, dynamic campaigns are what will make you stand apart in the holiday season, where timing is everything.
If your target segment is fond of using AI for shopping, why not allow them to do it on your site itself? Enhancing the customer experience by investing in AI shopping tools on your site will deepen loyalty and increase the time shoppers spend on your website.
You can use AI to create:
AI agents do not excuse ambiguous, incomplete, or outdated product data when ranking your catalog in search results. This means you need to ensure your product information follows a uniform taxonomy and contains language that your customers will search for.
Add helpful filters, product collections, and personalized recommendations that address lifestyle pain points. Your site should also have machine-readable policies, timelines, pricing information, and stock updates.
Making your catalog AI-compatible will ensure you’re not missing out when your competitors are being featured in front of AI-powered shoppers.
Clarify how your site uses customer data for personalization. In addition, prioritize verified reviews, avoid dark patterns, and display transparent shipping and return policies.
Authentic, transparent, and accurate information will send strong relevance signals to AI systems, improving your ranking in the AI search results and summaries.
Modern shoppers are incorporating in-store purchases into their holiday shopping. They expect merchants to offer a unified experience connecting online and in-store experiences.
This means offering consistent product information and prices across channels, unified loyalty programs, flexible returns, and seamless Buy Online, Pick Up In Store (BOPIS) options. You should also focus on a seamless checkout to support fast-moving shoppers and enhance both in-store and online shopping experiences.
If you’re able to anticipate shopper behavior in time and prepare for it comprehensively and effectively, you’ll maximize the probability of conversions.
This involves keeping an eye out for how AI-powered shoppers plan purchases, search for gift suggestions, hunt deals, track prices, and prioritize affordable payment plans:
The key to satisfying the AI-powered shopper this holiday season is to stay on top of AI consumer trends and optimize your catalog for AI tools and agents. Ensuring AI-compatible product information and AI-powered omnichannel and checkout experiences is no longer optional.
PayPal Agentic Commerce can help you capture the holiday demand by exposing your products to relevant AI surfaces, offering new opportunities for conversions. Our vast network, versatile payment options, and high customer trust offer your business a unique blend.