The Top 7 Retail Industry Trends You Need To Hop Unto In 2025

The question that is constantly on the minds of retailers is how to keep shoppers happy so they make an initial purchase and come back for more. This has been an increasingly challenging question to answer as ecommerce has enabled the rapid increase of competition in retail and inflation has inevitably impacted consumer spending as shoppers think twice about how and where they spend their money.

One way to keep up with consumer behavior, preferences and priorities to tailor retail marketing and operations for more positive business outcomes is to look at trends in the retail space.

The Importance of Knowing Industry Trends

The retail space is changing at a rapid pace and that directly impacts consumer expectations so what customers are looking for from retailers in order to make a purchase. When you are tuned into retail trends, you understand how to communicate your differentiation and value to customers, how to get ahead of competitors, and what innovations are worth investing in to boost retail sales and customer loyalty.

Looking at industry trends is the closest you will get to looking into a crystal ball to find out what changes will keep you ahead of the curve as a retailer. Being proactive is much more profitable than reactively trying to keep up with the movers and shakers.

How is the Retail industry doing?

But is it realistic to expect growth at a time like this? The uninspiring economic situation has caused a lot of concern, especially following the pandemic years that were plagued with supply chain issues, labor shortages, the shutdown of brick-and-mortar retail stores, and general uncertainty. Retail companies do have an opportunity to bounce back. According to the National Retail Federation (NRF), the average annual retail sales growth rate has risen beyond the pre-pandemic level to 3.6%. Their reported statistics also put an emphasis on phygital retail experiences as 9 of the top 10 ecommerce websites are run by retailers that also operate brick-and-mortar retail stores. Omnichannel retail is proving to be supportive of overall retail growth.

7 Top Retail Industry Trends for 2024

So what trends are driving retail sales growth and customer loyalty at the moment?

#1 Continued growth of online shopping

Buying online still has value to shoppers. It’s more convenient if they don’t have the time to get out of the house to shop in-store. Plus, online shopping offers a wider range of choices than what is within reasonable driving distance of the average person’s home. Ecommerce is a profitable opportunity for retailers because they can use digital marketing techniques to get ahead of competitors and reach a high volume of customers. It’s also an opportunity to refine the customer experience using emerging personalization technology such as AI to give shoppers what they want when they want it.

#2 The green market

Just like other industries, retailers have to meet new sustainability expectations. This demand comes from governmental and regulatory bodies as well as consumers due to ever-increasing concerns about climate change. The traditional retail industry has contributed to the damage to the planet but that can change. One of the biggest sources of waste in retail is packaging. Reducing packaging and using easily recyclable and quickly biodegradable packaging is a selling point for today’s customers and helps retailers meet climate action goals.

#3 The hybrid workforce

With the continued prevalence of ecommerce is an opportunity to leverage the hybrid workforce. While sales assistants in-store need to be within reasonable distance of a store’s location, the digital touchpoints a retailer offers can be managed by a wider pool of people. The customer reps you employ to respond to webchat messages, send out text marketing campaigns or request reviews could be location-independent in order to connect with the best talent and create a diversity of thought. This is made much easier with the cloud-based software available to manage key retail processes.

#4 Maintaining privacy and personalization

A lot of lessons have been learned about both the value and risk of collecting customer data in order to provide a personalized customer journey. It can refine retail marketing to encourage consumer spending. It can also disrupt trust between consumers and retailers. Laws (such as the European Union’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA)) have come into place to protect consumer privacy but there is more to be done to regain consumer trust. The priorities are to protect customer data from cyberattacks and to only collect data for valid reasons. That’s why some major corporations are stepping away from third party cookies, opting to offer a personalized experience that doesn’t compromise consumer privacy.

#5 In-person interaction

Brick-and-mortar retail stores still exist and still make a hefty proportion of profit for retailers because they offer something ecommerce can’t – in-person interaction. Retail companies can grow retail sales in-store by doubling down on the unique value of in-store shopping. Hiring personal shoppers to guide customers through the store is a great way to create a memorable experience. People are craving that level of connection and special experience. Elevating the in-store experience is also an opportunity to provide a phygital experience that leverages the benefits of both physical and digital channels. For example, Reformation stores allow customers to build their dressing rooms by selecting items they’d like to try on via a tablet.

#6 Growth in operations automation

The development of the capabilities and accessibility of automation is a definite win for retailers. They can automate repetitive and fast-changing processes to save resources and stay ahead. For example, pricing can be automated to reflect costs, demand and other agile factors. An automated workflow can be set up to manage inventory, using real-time data and AI algorithms to reorder the right amount of stock for upcoming demand before it sells out. This not only improves the speed and accuracy of outcomes but frees staff up to do the tasks that can’t be automated like in-person interactions with customers.

#7 Omnichannel retail marketing

As well as providing a multi-channel shopping experience, there is massive potential in marketing on multiple channels. Social media, email, text, influencer and SEO marketing alongside paid ads create an omnichannel marketing experience. This gives customers more potential entry points to find out about a retailer. It also increases the likelihood that a customer will come across the brand’s marketing messaging multiple times, making the brand more memorable and the customer more likely to make a purchase. To really maximize the outcomes of an omnichannel marketing campaign, make each touchpoint an opportunity to engage. Go live on social media or pay an influencer your target audience is already engaging with to talk about your products. Get creative with social commerce.

Retail Industry Market Outlook: Analysis & Forecast

With these specific commerce trends in mind, what economic situation do retailers need to prepare for in the next few years? Despite the transformational changes retail companies are experiencing, it’s predicted the industry will rise to the challenge with a CAGR of 7.65% predicted between 2024 and 2029. This will grow the value of the retail industry from $32.68 trillion in 2024 to $47.24 trillion by 2029.

These retail industry trends are predicted to be drivers of growth. Even with the rapid transition to online shopping during the pandemic years, ecommerce is still the fastest-growing area of retail. It’s the retail companies that are able to provide an excellent omnichannel experience both online and in-person, supported by recent technological developments such as AI and augmented reality (AR) that are predicted to carve a competitive advantage.

What is the Future of the Retail Industry?

But what will be driving growth in retail in the next 5 to 10 years? These are only predictions of course! Brick-and-mortar retail stores will still be a staple. They will be re-imagined to offer a unique customer experience that differentiates in-store shopping from online shopping.

Supply chains will also go through a transformation to be more resilient and responsive to market demands and changes due to the utilization of real-time data and AI predictions of demand and supply.

As omnichannel retail experiences increase the number of digital and physical touchpoints between customers and retailers, AI will be increasingly relied upon to manage multi-channel personalization of retail marketing and sales. That’s just what we can see becoming part of commerce operations and customer experience at the moment.

Whatever trends come into play and whatever changes the ever-evolving retail landscape demands, responsive communication is highly valued by consumers. Share your message with customers in a consistent, compelling and personalized way with text marketing. It has the best open and response rates whether you want to promote a new product, request a review or run multiple campaigns at once supported by an AI assistant. Boost your reach, grow your customer base and build your profits with Podium.