Christmas doesn't end at the tree — for many, it ends at the return counter.
Why it matters: Americans return tens of billions of dollars worth of unwanted Christmas gifts every year, turning good intentions into one of retail's biggest annual money sinks.
- The post-Christmas return rush typically peaks in the days immediately after the holiday. Returns jump 25% to 35% beginning Dec. 26 compared with earlier in the month, according to Adobe Analytics.
- The weeks-long surge, dubbed "Returnuary," extends well into January, keeping return counters and shipping networks busy.
Zoom in: The most unwanted and frequently returned gifts include:
- Clothing and shoes: Sweaters, socks (yes, socks again) and other wearables are easy to gift but hard to get right on size, fit and personal style.
- Accessories like hats, scarves and jewelry: Easy to buy, easy to miss the mark.
- Electronics and gadgets: Duplicates, defects or devices that don't match how people actually live.
By the numbers: 20 to 25% of retail sales are expected to be returned in 2025 — representing roughly $1 trillion worth of merchandise, according to data from returns platform Seel, which factors in last holiday season's return surge.
- Holiday returns spike about 16% in November and December, when early shopping collides with last-minute buying, per Seel.
- The average returned item typically falls in the $100 to $200 range, returns data firms estimate.
Between the lines: Many returned items never make it back onto store shelves.
- "In reality, most are never restocked because brands don't have the infrastructure to process them in a cost-effective way," Emily Hosie, founder and CEO of open-box marketplace REBEL, told Axios.
- That contributes to an estimated 8.4 billion pounds of returned goods ending up in landfills each year, Hosie said.
What they're saying: "The number one reason for returns is that you got the wrong size," Bobby Ghoshal, CEO of AI shopping platform Dupe.com, told Axios. "People are really particular about how their items fit."
- "If you're causing your daughter-in-law to run extra errands to the mall with three kids in tow to exchange a sweatshirt, she may not be as grateful as you would expect," Ghoshal said.
Yes, but: Traditional gift categories like toys and beauty products remain relatively stable after the holidays, Marty Bauer, marketing company Omnisend's e-commerce expert, told Axios.
- "That suggests most post-holiday returns come from rushed purchases rather than categories where shoppers spend more time choosing the right item," Bauer said.
What's next: Retailers are betting AI can shrink — but not eliminate — the volume of returns.
- 73% of consumers say AI will make them less likely to return products, compared to 69% last year, according to a Talkdesk holiday survey as tools help shoppers make more confident choices before buying.
The bottom line: Unwanted gifts are a Christmas tradition of their own — but smarter tools may help keep a few more presents out of the return line.
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