Consumers are predicted to spend nearly 14 per cent more this holiday season, averaging $1140 per person, according to Deloitte’s annual Retail Holiday Report. 

The report, which surveyed 150 Australian retail executives and 1000 customers, looked into consumer sentiment regarding the November to Boxing Day trading period. 

The survey found that 84 per cent of retailers expected stronger sales, up from 51 per cent last year, with one in three shoppers planning to spend more, especially during November sales events. 

According to the report, retailers expected stable or modest sales growth, with 51 per cent expecting a growth of up to 5 per cent and one-third forecasting growth of over 5 per cent. 

Although retailers anticipate over half of their holiday revenue will come from Click Frenzy, Black Friday and Cyber Monday combined, Christmas and Boxing Day are still expected to deliver the strongest sales on their own.

“Australian shoppers remain price-sensitive and on the lookout for a deal,” said Deloitte consumer products and retail partner Damien Cork.

“While most plan to maintain or increase spending, only 15 per cent say they feel financially confident.

“For the first time since this survey began, retailers expect to generate 50 per cent of their holiday revenue through this period,” said Cork. 

Consumers have also indicated they would rely on Chinese online marketplaces to secure discounted prices and bargains, a model that is growing as a competitive threat to Australian retailers. 

Around 33 per cent of consumers expect to spend more this year than last, up from 24 per cent last year, with 59 per cent of Australians aged 18 to 24 and 38 per cent of blue-collar workers leading the way.

Although higher-earning households are more likely to increase spending, 34 per cent of those in households earning below $50,000 say they will spend less. 

Thirty-four per cent of consumers indicated they would switch brands for better deals, rising to 42 per cent for those under 35. 

The report found a shift from spending on gifts, set to rise by only 4.2 per cent, to spending on experiences such as holidays instead, which is set to increase by almost 30 per cent. 

“Cost sensitivity is also doing its part in accelerating a shift towards online shopping, particularly among younger consumers: around two in five Gen Zs (44 per cent) and 25 to 34-year-olds (41 per cent) say they are more likely to shop with Chinese online marketplaces this year, drawn by low prices, vast selection and fast delivery,” said Harsha Maddipatla, retail strategy partner at Monitor Deloitte. 

Over the next year, the report found, 32 per cent of consumers feel optimistic about their financial outlook, up from 26 per cent last year. 

Retailers eye growth next year

More than 80 per cent of retailers expect sales growth in the next year, with 74 per cent expecting an improvement in consumer confidence, up from 41 per cent last year. 

The percentage of retailers citing cost pressures as their greatest risk dropped from 40 per cent last year to 24 per cent this year, with 34 per cent of retailers citing existing competition as their top risk. Crime is another concern, with nearly half of all retailers reporting a rise in shrinkage caused by theft, fraud or error. 

The use of AI as a key tool in improving efficiency has led 41 per cent of retailers to mainstream its use across their business.

“Success in 2026 will depend on striking the right balance between customer experience and pricing strategy,” said Cork. 

“Retailers will need to fine-tune the timing of promotions, protect margins and adapt quickly to changing consumer behaviour to win the day.”