Retailers are focusing on affordability and value to attract cautious consumers amid historic low consumer sentiment, leading to increased demand for lower prices and essentials. Companies like Target and Walmart are adjusting pricing strategies to encourage spending during the holiday season. Consumers are prioritizing value and essential items while looking for deals in discretionary categories. Retailers are lowering prices and investing in lower-priced items to meet consumer demand and manage budgets. The Federal Bank of New York reports record high household debt, with total debt reaching $18.59 trillion. Despite some companies facing declining sales, Best Buy and Gap Inc. are optimistic about holiday sales, with Gap raising its full-year guidance. Shoppers are becoming more price-savvy, favoring transparent pricing and practical messaging over extravagance. Retailers are offering temporary promotional discounts to avoid permanently lowering prices and recalibrating consumer expectations. The rise of the everyday-low-price model is gaining traction as it guarantees consistent low prices without the need for big annual sales.

Read more at Yahoo Finance: How retailers are responding to the affordability crisis this holiday season