AI Personalization: The New Determiner in Holiday Shopping for Gen Z Consumers

The holiday shopping season is usually the retail industry’s comfort blanket—a reliable fourth-quarter surge to cover up weaker months. In 2025, that blanket feels thinner, and retailers are bracing for a chill.  

Sales are expected to grow just 1.2% during November and December, according to eMarketer’s May forecast—below the year’s 1.5% growth rate. Consumers are spending more carefully, inflation is still biting, tariff is still rising, and confidence is shaky. 

Yet, in this restrained atmosphere, new determiners have taken their rightful place in the market puzzle.  

Mobile commerce, Pricing, Gen Z’s social-driven shopping behavior, and most importantly, AI personalization is becoming the new determiners of success for holiday retail.  

Now, it’s time to dig deep to seek out what AI as a new factor works here.  

Success hinges on technology and data  

As Sky Canaves, eMarketer principal analyst, said in a recent Meet the Analyst webinar:

“Brands and retailers won’t be able to bank on the traditional holiday season to compensate for the rest of the year.” 

Last year, AdPulse reported that three major patterns have risen to the occasion and brands must adapt to them. They were pricing, mobile adaptation, and post-purchase experience.  

A year later, AI is emerging as the biggest wild card this season. For the first time, it’s not just a behind-the-scenes tool for inventory or ad targeting—it’s a visible shopping assistant for consumers. 

AI personalization is reshaping holiday shopping behavior 

“Globally, around 5% of shoppers are using AI chatbots to start their product searches. But among Gen Z, the rate is double,” said Canaves.  

That gap says everything: Gen Z is normalizing AI as part of their shopping journey faster than anyone else. 

Adobe’s data reinforces the trend: during Amazon’s July Prime Day, sales traffic to retail sites from generative AI sources surged 3,200% year over year.  

And the tools are multiplying. Amazon’s Rufus and Walmart’s Sparky are positioning themselves as “store associates in your pocket,” improving their ability to deliver personalized recommendations on the fly. 

“They’re improving in their ability to provide relevant and personalized recommendations,” Canaves added. “And again, we see younger consumers leading adoption and forging new behaviors when it comes to AI and shopping.” 

This means personalization is no longer a “nice-to-have.” It’s the battleground advantage. 

Mobile is still the control center for holiday shopping 

Mobile remains the retail battleground. Over 90% of the net increase in holiday ecommerce sales this year will come from mobile, according to eMarketer’s May 2025 forecast. By the end of the year, mobile penetration will reach 56.5%, well above the annual average of 46.1%. 

Why? Convenience. Shoppers love the ease of browsing, comparing, and buying—all without leaving the couch (or the endless holiday lines). 

Commuters browse deals between train stops, college kids compare prices while standing in-store, and Gen Z scrolls through TikTok only to end up on checkout screens. 

“The shift to mobile is more than just a trend,” explained Meredith Gaiser Mitchell, industry marketing lead for retail and ecommerce at Braze. “It’s the primary way customers engage with brands. Discovery happens everywhere.” 

That last line is crucial. Discovery used to happen in malls, then in Google searches. Now it happens mid-scroll—on a bus, in bed, during a lunch break. Retailers who can connect those dots instantly, across devices and contexts, will set the tone for this holiday season. 

Gen Z shopping behavior holds delivery points 

Gen Z’s holiday shopping patterns are distinguished from those of other generations. For this generation, the shopping funnel and the social feed are practically the same. 

Nearly 70% of US Gen Zers discover products on TikTok, according to ‘Path to Purchase’ survey. Even more telling, 42.5% said TikTok is their most useful platform for product research.  

Even in our ‘AI Broke the AIDA Marketing Funnel’ story, we touched on how the customer journey has been blown wide open by AI, real-time personalization, and a never-offline, always-scrolling consumer base.  

Platforms like TikTok Shop, with integrated checkout and secure payments, eliminate the gap between inspiration and transaction. 

Personalization matters more in a cautious year 

Because cautious shoppers are picky shoppers, when wallets are tight, consumers don’t just buy—they justify. And personalization makes that justification easier. 

AI personalization allows brands to show shoppers exactly what they want, when they want it. It also reframes affordability as indulgence while offering free gifts with purchases, bundling products into gift sets, or simply recommending items that feel more relevant. 

“Consumers are more likely to buy from brands offering a personalized experience,” Mitchell said. And when brands do it right, a one-off purchase can become a habit. 

Those little touches made each consumer feel like they had a one-to-one relationship with the brand. 

AI personalization is more than a holiday determiner  

Yes, it is more than just a seasonal trick. And this is where the story extends beyond holiday revenue. The holiday season is retail’s largest stage, but it’s also the best test lab for consumer loyalty. Personalized recommendations, timely reminders, and seamless cross-channel experiences don’t just drive sales.  

“The holidays are about making memories through gifting, and that starts with gifting the right message to your customers,” Mitchell said. 

That “message” is increasingly AI-driven, but it doesn’t feel robotic. When done right, it feels thoughtful, helpful, and even human. Which is exactly why Gen Z, living in algorithm-driven ecosystems on TikTok, Spotify, and Instagram, embraces it faster than older cohorts. 

Cut to the chase 

Holiday shopping has always been about the right mix of price, convenience, and experience. In 2025, those factors remain, but the weight has shifted. Mobile is the anchor, Gen Z is the trendsetter, and AI personalization is the accelerator.