Black Friday-to-New Year: A Fragmented Demand Cycle Executives Can’t Ignore

The holiday window (Black Friday through New Year’s) is the most revenue-dense period for consumer businesses, but assuming it will automatically deliver is strategically negligent. Macro signals already show strain: 87% of U.S. adults report higher grocery prices, 42% plan to spend less, and per-person holiday spend is slipping from $902 to about $890. Households are compensating by pulling from savings and bargain-hunting, with nearly 60% saying inflation will reduce charitable giving.

Yet demand didn’t collapse, it has fragmented. Mastercard SpendingPulse reported a 4.1% year-over-year lift in Black Friday retail sales, and Adobe tracked $20.2B in online apparel spend plus a record $6.4B online on Thanksgiving. The Fed’s Beige Book shows the underlying shape: low- and middle-income spending is contracting while higher-income activity holds. This results in a K-shaped dynamic that shifts where and how volume shows up. Retail outcomes confirm the split: Walmart gained share across income groups, while Target and Bath & Body Works struggled with selective shoppers.

Category-level strategy drove outcomes more than raw traffic as reported by CommerceIQ 2025 Cyber 5 Retailer Traffic Report:

• Beauty: Shopper surveys performed by McKinsey in early 2025 showed that beauty consumers have shifted from buying more to buying smarter. After years of rapid growth driven by newness and rising prices, shoppers are now far more value-driven and selective. This has played out so far this holiday shopping season. High-low pricing drove units but crushed margins. Brands raised ASP (+37%) yet doubled discounts to move volume, producing a -17% profitability hit despite strong ad efficiency. Revenue without margin isn’t sustainable.
• Toys: Shopper reviews performed by Circana in mid-year 2025 show that category growth isn’t evenly spread; adults are now the fastest-growing and highest-spending segment in the toy market, with data showing a double-digit increase in adult toy purchases year-over-year. This resilient shopper segment allows for dynamic marketplace action this Black Friday as strong margins (+11%) funded an aggressive ad push (+290%), generating a +50% revenue surge despite declining ad efficiency. Margin was used offensively to capture share.

The lesson is clear: holiday success is no longer guaranteed by traffic alone. Brands that optimize pricing, promotions, and media allocation to the specific dynamics of their category and shopper base—not last year’s assumptions—capture the upside. Foresight Strategy helps quantify these realities, identify misaligned spend, and adjust strategies before the holiday window closes. Opportunity exists, but precision now dictates who wins.

Best,

Dane Birkeland

Source(s):

2025: The public’s priorities and expectations – AP-NORC

Mastercard SpendingPulse: US Black Friday retail sales up +4.1% YOY as holiday momentum builds

The Beige Book Nov 2025 – Federal Reserve Board Publication

2025 Holiday Shopping Statistics, Trends & Insights | Adobe

Walmart earnings: Stock jumps as retailer projects fruitful holidays

Spatiotemporal Allocation of Advertising Budgets – Ashwin Aravindakshan, Kay Peters, Prasad A. Naik, 2012

Cyber 5 2025 insights: download the full report

State of Beauty industry trends 2025 | McKinsey

U.S. Toy Industry Dollar Sales Have Increased in 2025 | Circana