Gen Z steers the surge in AI-driven shopping

AI-assisted shopping is shifting from experimentation to routine behavior, and younger consumers are driving the transition. Multiple new surveys indicate a rapid rise in the use of AI tools for product discovery, price comparison, and purchase decisions across the U.S.

A September 2025 PayPal survey shows 61% of Gen Z shoppers used AI to support a purchase over the past year—the highest adoption rate among all age groups. Millennials follow closely at 57%, reinforcing a broader trend of younger consumers integrating AI into everyday shopping.

Additional data from Mastercard and the Harris Poll signals growing comfort with automated decision-making: half of Gen Z and 49% of millennials say they would delegate gift-shopping responsibilities to AI to avoid stress. Trust in AI’s ability to secure deals is also increasing. According to YouGov, 42% of U.S. shoppers would permit an AI agent to make purchases for them if it could consistently find the lowest price.

PayPal’s 2025 Holiday Shopping Survey highlights that the technology will play an even larger role during the season. Four in ten consumers have already used AI during shopping, and 77% of former or potential users plan to rely on AI assistants for tasks such as identifying discounts, comparing products, and generating gift ideas.

The rise in AI engagement is influencing how merchants prepare. Visibility across AI-powered search and discovery platforms is becoming a prerequisite for reaching consumers earlier in their decision process.

Alongside AI’s expansion, shoppers are leaning on alternative payment methods to manage holiday budgets. PayPal reports that half of U.S. consumers plan to use Buy Now, Pay Later (BNPL) during the season, citing its ability to distribute costs over time. More than half say BNPL availability makes them more likely to complete a purchase, with Gen Z and millennials again at the forefront—one in four uses BNPL regularly.

Merchants offering BNPL continue to see higher conversion and larger average order values, indicating that flexible checkout options remain a significant factor in how younger consumers decide where and how to shop.

According to a recent analysis by Adobe, BNPL spending hit a new record on Cyber Monday 2025, climbing to $1.03 billion, a 4.2% increase from last year. Close to 80% of those purchases were made on mobile, underscoring the payment method’s growing reliance on smartphones.

Consumer behavior also shows a broad return to omnichannel shopping. Sixty-four percent of shoppers expect to visit physical stores this holiday season, while 28% will shop mostly online. A substantial share plans to move between channels, emphasizing the need for retailers to provide consistent experiences across digital and in-store touchpoints.

Rewards programs are another key driver, with 74% of shoppers more likely to buy from merchants offering cash-back or other incentives. As shoppers combine online research, in-store browsing, and AI-driven assistance, retailers integrating payment flexibility and loyalty benefits across channels stand to capture sustained engagement.