From unexpected political shifts to surprising technological breakthroughs, 2024 saw major developments across sectors, and retail was no exception. With economic uncertainty ongoing, predicting what's next isn't easy in an arena where consumer behavior keeps evolving. Here are three trends likely to shape the year ahead.
AI waves to watch: AI agents, generative AI
In 2025, AI's role is set to expand well beyond simple, generic use cases. According to NRF, 2025 is the year of the AI agent, digitally, the technology can already influence sales by 60%, a number likely to grow as agents learn to tailor recommendations, improve decision-making, and manage replenishment. Generative AI is also poised to have a significant impact.
To deliver genuinely tailored interactions, brands need AI integrated into their existing systems with real-time access to accurate data. Teamwork Commerce is working with Google Cloud to build new generative AI features into its mobile Point of Sale and Order Management System, aiming to give retail associates a generative AI assistant that can help them answer customer questions quickly and accurately.
Conscious purchasing
Economic uncertainty over the past couple of years has made consumers more conscious of their purchasing habits, both financially and environmentally. A recent PwC survey found 22% of global shoppers plan to spend more consciously, seeking eco-friendly products and transparent practices. Rental fashion is one example of retailers meeting that shift, British Vogue reports that renting a single item can reduce water usage by up to 24%, energy by 6%, and CO2 emissions by 3% compared to buying new. Brands that build sustainable offerings into their products and operations stand a better chance of winning long-term loyalty.
Hybrid shopping to increase
Buy Online, Pickup In-Store (BOPIS) and Buy Online, Return In-Store (BORIS) continue to reshape how customers shop. Over the 2024 holiday period, online purchases rose 6.7% year over year, and BOPIS orders doubled the weekend before Christmas, making up nearly 40% of all online transactions. In the US alone, the click-and-collect market is expected to surpass $154 billion by 2025. Retailers need to invest in blending online and physical stores so that everything (supply chain, e-commerce, mobile, and social commerce) runs on the same accurate, real-time data.
What's next?
AI is already dominating much of the retail conversation in 2025, though discourse at NRF 2025: Retail's Big Show suggests expectations around the technology have settled compared to a year ago. Conscious consumerism will likely keep the market competitive alongside it. The key takeaway for retailers is to stay aligned with consumer values while equipping themselves with the latest technology, ideally through a single, all-encompassing retail tech stack rather than a patchwork of point solutions.