Close-up of a person’s hand holding a smartphone and using the Opus 4 model within the Claude app from AI company Anthropic, Lafayette, California, May 22, 2025. (Photo by Smith Collection/Gado/Getty Images)
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This holiday season isn’t just about gift lists and glitter. It is a stress test for the billions retailers have poured into artificial intelligence. In 2025, headlines have been buzzing with announcements: Puma weaving AI into its advertising, Levi’s partnering with Microsoft to build a “super agent” that automates tasks across the business. In today’s hyper-aware AI environment, brands aren’t just experimenting. They are betting big. Those taking a wait-and-see approach risk falling behind.
That is no small challenge for an industry rooted in design and curation, where change often moves at a measured pace. But this holiday season will reveal whether AI can truly integrate into retail’s many touchpoints, most critically accelerating the path to product discovery.
Personalization: Cutting Through Holiday Noise
Fashion’s biggest AI opportunity lies in personalization. Online shopping and the rise of marketplaces have created an abundance of choice—sometimes too much. Decision fatigue is real, especially during the holidays. AI can cut through that clutter, delivering curated experiences that surprise and delight.
Consumers are already leaning in. According to Circana, 44 percent of shoppers have used AI tools to help with fashion purchases, and 42 percent of those tapped platforms like ChatGPT for style advice. Walmart’s recent partnership with ChatGPT even allows consumers to shop directly through the chatbot. For retailers hesitating to embrace this shift, the risk is clear: competitors will move faster.
While treasure hunting remains part of the thrill, as evident in off-price’s rise, shoppers do not want to spend hours searching. They want speed, relevance, and convenience. AI can deliver all three.
Could AI Tip the Scale Back to Online?
Despite predictions of the “death of the store,” brick-and-mortar has proven resilient. As off-price expands its physical footprint and DTC brands open locations, e-commerce has plateaued at roughly 30 percent of total apparel sales after years of steady online growth pre-pandemic. But if AI can deliver hyper-personalized recommendations and frictionless experiences online, we could see online apparel share inch past that 30 percent threshold.
Who’s Using AI and Who’s Next?
Circana’s survey revealed some interesting insights into how demographics are interacting with AI and fashion: This is not just a women’s game. Men slightly outpace women in using tools like outfit generators and reverse image search. For retailers, this provides an opportunity to engage a consumer who may be more reserved in asking for fashion advice. Additionally, interest is strong among non-users. Sixty percent of those who have not used AI for fashion shopping say they are curious, especially for applications that enhance convenience such as chatbots and personalization tools like virtual try-ons and curated looks.
The Stakes Are High
Two out of three consumers who have used AI for fashion shopping report positive experiences. Among men, 43 percent say AI saved time and improved their overall journey. That is encouraging, but this holiday season will be the real test. Can AI move from novelty to necessity? Can it deliver on its promise without eroding trust or creating friction? It only takes one negative experience to sour AI in the minds of consumers.
Retailers will be watching closely. Success could accelerate investment and reshape strategies for 2026. Failure might cool the hype. Either way, this holiday is not just about sales. It is about proving whether AI can truly become retail’s competitive edge.