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Discretionary Spending Undergoes Changes in 2025
Even as economic headwinds, including tariffs and higher everyday costs, are limiting discretionary budgets and prompting consumers to be more selective about where they spend, foot traffic to several discretionary retail categories continues to thrive year-over-year, says Placer.ai in a new white paper.
Titled What is Driving Discretionary Spending in 2025, the white paper delves into which discretionary retail categories are gaining momentum by delivering value, accessible upgrades and immersive experiences. Some of these categories represent a reversal from prior years, according to the white paper.
Perhaps unsurprisingly, discount & dollar stores and off-price apparel are outperforming as consumers prioritize value and the “treasure-hunt” experience, the white paper states. Meanwhile, clothing and home furnishing traffic remains strong as shoppers favor accessible wardrobe updates and decor refreshes instead of major renovations.
Within apparel, though, there’s a bifurcation. Placer.ai reports that visits to off-price and luxury segments are growing, while general apparel, athleisure and department stores face ongoing pressures from consumer trade-downs
- ◦Economy
