Where Retailers Need to Win in 2025

Every year in retail is unique, and 2025 will be no different.

Whether it’s the economy, evolving customer wants and needs, social trends, advancing omnichannel integration or new outlets for creative brand building, retailers benefit from strategic awareness and careful planning and execution.

So here are six key focuses for retail store development in 2025:

Develop a plan for new tariffs

No one really knows what’s going to happen in 2025 with potential tariffs. Will they be implemented? And how and to what extent? What will they mean for pricing, supply chains and the economy?

Here are some proactive steps to take sooner rather than later:

• Map your supply chain and identify products and materials potentially affected by tariffs.
• Explore alternative suppliers in different regions to minimize reliance on countries subject to tariffs.
• Work with suppliers to negotiate pricing structures that account for potential tariff-related cost increases.
• Stock up on goods ahead of tariff implementation to delay cost impacts.
• Implement technology to better predict demand and manage inventory efficiently.
• Stock up on goods ahead of tariff implementation to delay cost impacts. Implement technology to better predict demand and manage inventory efficiently.
• Monitor policy developments and stay informed on tariff updates to adapt strategies in real time.

Again, this is uncertain territory. But by planning ahead, retailers can reduce disruption, control costs and maintain competitive positioning in a changing global trade environment. And, if tariffs don’t become a challenge this year, the above efforts will at the very least provide valuable learnings.

AI as artificial and real intelligence

AI is part of the discussion in every industry. In retail, it can enhance the customer and associate experience, optimize operations and drive sales.

Is it an all-knowing, magic pill? No. Just like anything else, it requires disciplined analysis and thorough understanding before adoption. Some areas to experiment with and explore:

• Personalization: AI can evaluate shopper behavior and provide personalized recommendations that are valuable to them.
• Inventory management: Predictive analytics can forecast demand, reduce overstock and minimize running out of stock.
• Merchandising insights: Analyze shopper behavior to support store layout and display placement.
• Associate support: Chatbots, scheduling, store navigation and task prioritization free time for more and better customer interaction.
• Unified commerce: AI bridges online and offline channels for a seamless shopping experience.
• Brand voice: AI can provide a back and forth on multiple iterations of your brand image, which can fuel valuable discussions on expanding your brand reach and communication.

Of course, there are many other uses, including fraud prevention, automated checkout, dynamic pricing and even tracking waste usage. The issue is not what it might do but understanding how it specifically can improve your operations and customer experience and how to seamlessly use it without early-adoption pratfalls.

Flexible store environments

Flexible store environments are not only about accommodating seasonal décor. They’re also about being able to quickly and easily move fixtures, displays and products to meet customers where they are and to support store events or specials.

Can you move and/or adjust store fixtures to accommodate and even improve in-store or pop-up events? Modular design, adaptable fixtures and flexible digital displays can help achieve this.

This flexibility incorporates a recognition that shoppers don’t engage your brand only one way. A single person is often multiple customers, depending on day, time and purchase target. A July 2024 Coresight Research study found that two-thirds of shoppers already use multiple channels in their purchase decisions.

And this isn’t just older shoppers who like online research and browsing in stores —  63% of Gen Z respondents said they planned to make holiday purchases at physical stores, according to an annual survey by consulting firm EY.

So, it’s important to continue to prioritize developing and maintaining a scaled and holistic, store-by-store understanding of flexible décor. This includes costs and project execution parameters that provide branded environmental upgrades while meeting budgets and timing requirements.

Technology is more than AI

Great retail hinges on creating seamless, engaging and personalized experiences that resonate with customers across all channels. In an increasingly digital world, including multiple generations that grew up online, this requires a holistic understanding of the interconnections of paths to purchase, next-generation branding and design creativity.

For example, retail media networks (RMNs) engage shoppers at the shelf level, combining digital information with adjacent product placement and promotion.

Or there’s the expansion of “endless aisles” with app use or QR-based campaigns that drive shoppers to additional options/choices/colors or other products in the collection online.

This is about a holistic approach to designing branded environments, seamlessly connecting digital and physical touchpoints, accommodating what is now and next for both loyal and new customers.

DEI & sustainability

Trends and public sentiments rotate back and forth over time. Yes, there is presently a DEI (Diversity, Equity & Inclusion) backlash as well as some vocal skepticism against businesses emphasizing sustainability and environmentally friendly policies.

Take time to discuss internally how communication with customers and associates might be different in 2025 compared to, say, 2019.  Be ready for customers who might be vocal or confrontational in response to your efforts and plan accordingly so your overall customer and associate experiences aren’t adversely affected. 

Holistic brand thinking

Advancing your brand in 2025 means seeking every possible way to positively engage customers.

Brand activations at outside events or in-store pop-ups that range between brand partnerships or even in-store food and drink offerings can serve as brand beacons that pique curiosity and create instant customer appeal.

Every design element and brand touchpoint, from social media to old-school print advertising and every point in between, should positively reflect your brand’s story and evoke a unified, authentic feeling that aligns with your brand’s values, speaking to customers on an emotional or even subconscious level.

While retail trends are real, important and variable, in many ways every year ultimately will be the same: Meet your customers where they are right now with the best possible shopping experience. This builds trust and loyalty and fuels revenue growth.

"Style Tour" activation by Walmart located in Greenville, South Carolina.