Black Friday Retail Stalemate
Holiday shopping during Black Friday, traditionally accounting for up to 40% of annual fourth-quarter sales, faces a stalemate this year in the U.S. Retailers are waiting for consumers to start spending, while consumers hold out for deeper discounts in a dynamic described as "discount chicken." Consumer confidence has declined, adding to the tension in the market.
Consumer Sentiment and Shopping Behavior
Consumers' outlook on the economy has turned sour with increasing worries about job prospects. The Consumer Confidence Index for November dropped to 88.7 from 95.5, marking its lowest point since April. Only 20% of U.S. consumers plan to begin their holiday shopping on Black Friday; over half have started earlier or plan to shop after the event, indicating a shift away from the traditional Black Friday surge.
Pricing Distrust and AI in Retail
Distrust clouds the event, with 84% of shoppers believing retailers inflate prices before Black Friday only to exaggerate markdowns, according to a Lightspeed Commerce survey. A WalletHub review found that 36% of Black Friday deals produced no real savings, with nearly 10% of items being more expensive than pre-sale prices. Retailers use AI-driven dynamic pricing, displaying varying base prices to different consumers, complicating the detection of true discounts. Meanwhile, consumers increasingly rely on AI tools to identify authentic deals, creating a stalemate between retailer AI and consumer AI tactics.
Economic and Security Pressures
Economic pressures weigh heavily on retailers, with tariffs on imported goods rising from 2.4% at the start of 2025 to 17.9% by October. Shoppers plan to spend an average of $622 during the Black Friday-Cyber Monday period—a 4% decrease from last year, the first drop in four years. Over 77% expect prices to rise, and 57% anticipate a weakening economy. Additionally, there has been a surge in AI-generated scams, with phishing emails up 620% and fake e-commerce sites increasing by 250%, mimicking major retailers and generating fake reviews.
Changing Shopper Dynamics
Generative AI adoption among shoppers has doubled in a year, with 33% planning to use AI for purchases this holiday season, rising to 43% among Gen Z. More than half of these AI users employ it to evaluate discounts and compare prices, underlining the evolving role technology plays in holiday shopping dynamics.
"Santa Claus is going to show up, kids are not going to be too disappointed, but don’t look for the tree to be overflowing with boxes underneath." — Marshal Cohen, chief retail adviser, Circana
The ongoing clash between cautious consumers and strategic retailers, intensified by AI and economic uncertainty, is reshaping the Black Friday shopping experience into a game of patience and skepticism with diminished confidence on both sides.
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