The 2025 holiday shopping season is shaping up to present its own unique challenges. For the first time since 2020, spending is expected to dip year-over-year—meaning more eCommerce advertisers could be competing for a smaller pool of consumer dollars.
At the same time, Google Ads has rolled out a wave of new tools that change how brands can build awareness and capture demand. AI Max, generative AI Shopping integrations, and the Creator Partnership Hub are among the new levers SEM managers can pull this year.
To help eCommerce marketers prepare, we’ve assembled seven SEM tips drawn from lessons of the past, the current economic climate, and the newest platform features.
1. Begin Planning Early and Build Awareness in Fall
Because of the competition of the typical holiday season, a comprehensive holiday strategy often begins in September and October. It’s important to lay the foundation for a successful holiday season rather than simply throwing money into the void during the holiday rush. The immediate lead-up to the biggest sales event of the year is NOT the time for consumer discovery—it’s too expensive and often too late.
In 2024, about two out of every three Black Friday/Cyber Monday shoppers in the U.S. already knew where they’d be shopping before the sales went live. Half of Black Friday shoppers admitted that they only focus on brands they already know.
If you’re an eCommerce brand planning to run a Black Friday/Cyber Monday sale, you know that competition during that period is going to be intense. All of your competitors are probably also having sales, and some of them are most likely offering better deals.
To combat this, load up on brand awareness for six to ten weeks leading up to Black Friday/Cyber Monday. Let customers discover you throughout the fall so they’ll be more inclined to search for you when it’s time to cash in.
Many businesses miss this entirely. They don’t want to spend much budget during slower shopping periods, because that usually doesn’t result in a directly-attributable return on investment. “Save the budget for the sale,” they say. But this ignores rising costs during the actual holiday period and overlooks basic truths about consumer behavior—during buying frenzies, they’re going to look for what they know rather than trying something new.
2. Expect Headwinds From the Economy
Q4s and holiday seasons are always a little different, but—as we mentioned in our introduction—2025 is expected to yield a drop in holiday spending for the first time since the pandemic-influenced 2020 season. Lingering inflation, rising unemployment, and pricing concerns due to tariffs could stymie spending this time around, with Gen Z shoppers anticipated to make up the largest share of this decline.
eCommerce brands should go into the season with realistic expectations. Set SMART (specific, measurable, achievable, relevant, and time-bound) goals. Rising prices and record-high credit card debt are still squeezing consumers, while unemployment is climbing. That means a more cautious, frugal, deal-driven shopper who is less likely to make impulse purchases and more likely to comparison shop.
3. Carry Forward Lessons From 2024
It’s always vital to learn from the past—and 2024 was another unique year for Black Friday/Cyber Monday and holiday shopping. Because of the November election, brand visibility came at a premium ahead of the traditional sale period. That was a major difference.
But there were similarities, too. In 2024, there were five fewer shopping days between Thanksgiving and Christmas compared to 2023. This year is also a somewhat condensed shopping season, with Thanksgiving falling on the 27th. Inflation was also a major concern for consumers in the last few years—so brands by now should be used to bracing for consumer caution.
So, what’s the biggest lesson from last year that applies in 2025? Reach shoppers early, knowing that they are going to be more frugal and deal-driven, and recognizing that there’s a smaller window for earning their patronage.
4. Take Advantage of New Google Ads Tools
With all of that downside out of the way, let’s talk upside. There are several new tools that can play a significant role in this year’s holiday strategy—especially for eCommerce businesses.
AI Max is the one that’s gotten the most attention, with its unique ability to expand a brand’s presence into countless auction opportunities. This can be a great tool for building awareness and driving consideration, especially with Non-Brand Search campaigns. It’s fair to question AI Max’s ability to drive conversions as efficiently as Search campaigns that rely on other match types, but when it comes to building awareness ahead of the shopping season, AI Max cannot be ignored for its sheer reach. Campaigns using AI Max can also serve ads inside of AI Overviews on the results page.
Speaking of AI Overviews, Shopping ads are becoming more normalized in these views. While campaigns using AI Max or Broad Match keywords can serve text ads within AI Overviews, Performance Max campaigns are also a must for eCommerce businesses. These campaigns serve feed-generated product ads within AI Overviews, as well as the many other ad formats and placements available through this campaign type. Reporting has gotten significantly better over the last year, so there’s really no good reason for advertisers to be timid about using Performance Max.
For those prioritizing brand awareness, the Creator Partnership Hub is a new tool that allows advertisers to establish relationships with influential creators who have already made content promoting their brand, products, or services. Advertisers can send linking requests directly to creators within Google Ads and use the same videos in their campaigns.
Advertisers also have new options in the form of YouTube’s Shoppable Masthead and interactive Shopping on CTV, both designed to bridge awareness and commerce. A new beta allows advertisers to exclude users from PMax campaigns based on gender, which is especially relevant for retailers in apparel or personal care and enables more specific creative alignment.
5. Adjust Keyword Planning for the AI Era
If brands are leaning into Broad Match or AI Max, they don’t need to build out sprawling keyword lists to have robust coverage. Instead, they can go live with their core themes, associate them with the right landing pages at the ad group level, and trust Google to find the right auctions.
Some brands will still want more control. In those cases, Exact and Phrase Match remain important, and holidays may be the right time to add seasonal keywords around “sale” or “gifting.” Regardless of the match type, diligence with Search Term reports and negative keywords is non-negotiable.
6. Use Your Existing Campaigns Where Possible
Holiday strategy doesn’t always mean launching entirely new campaigns. Whenever possible, we recommend using existing campaigns rather than launching brand new ones. Established campaigns already have performance data, which shortens the learning period and allows ads to begin serving more quickly and effectively.
For Search campaigns, introducing new ad copy or seasonal keywords can be tracked using Labels so performance can be easily monitored and adjusted. Within Performance Max, you might launch new asset groups within existing campaigns or update existing assets depending on whether you want both versions running concurrently. That decision may also depend on whether you’re changing Search Themes or Audience Signals.
For Video or Demand Gen, the answer is more case-by-case. For example, an evergreen Video Reach campaign may already be running as part of a brand awareness strategy, but a new seasonal video may warrant a net-new Video Views campaign or even a switch to Demand Gen if the goal is to drive more action. The principle is the same: build on what you have to minimize ramp-up while keeping the flexibility to test when needed.
7. Pace Budgets Around Key Milestones
The approach to pacing is still straightforward: spend when the opportunity is highest and pull back when it doesn’t make sense to be aggressive. Work with clients to define periods like Black Friday and Cyber Monday, the weeks between that event and the shipping cutoff, and the stretch from cutoff to end-of-season. Allocate budget shares to each period based on expected performance.
For example, eCommerce brands typically see performance fall drastically once they pass the “order today to get it by Christmas” deadline. With that in mind, gear your spend to decrease in late December compared to the weeks prior.
What to Watch in 2025
This year will be a test of both market conditions and new tools. With consumers expected to spend less, it will be interesting to see how brands adjust. Will we see more aggressive sales to capture scarce shopping dollars? Will competition intensify as brands fight harder for visibility, or will some advertisers retreat as expectations weaken? Will consumers cut back on essentials to free up holiday budgets, or will disciplined shopping habits prevail?
The answers will shape not only 2025 performance but also holiday strategies for years to come.
