What will define U.S. retail in 2025?
Coresight Research is predicting that 2025 will be a transformative year for retailers and consumers alike. The firm's latest report looks at six trends that will have the biggest impact on the retail industry next year.
Coresight predicts:
1. Retail Media, Data Monetization and Retail-as-a-Service as Alternative Revenue Streams
By 2028, retail media could represent as much as 27% of total digital advertising in the United States, up from around 17% in 2023, according to Coresight Research estimates. This growth will largely be due to more brands viewing retail media as a key channel for performance-driven advertising, ranking alongside traditional formats, such as social media ads.
As retailers monetize their intellectual property, retail-as-a-service will result in more retailer-to-retailer and retailer-to-brand vendor relationships across a wide variety of areas that Coresight believes U.S. retail is currently underpenetrated in, including fulfillment technologies and services, supply chain expertise, marketplace integration and end-to-end e-commerce platforms.
2. E-Commerce Marketplaces To Gain Share of the Retail Landscape
In 2025, Coresight believes that online marketplaces will capture an even larger share of retail sales as consumers continue to favor the convenience and competitive prices that these platforms offer. Furthermore, Coresight Research expects marketplace growth to outpace that of traditional retailers, given the rapid growth and success of newer platforms—such as Shein and Temu—as well as the growing adoption and expansion of marketplace models by major retailers, such as Kroger, Macy’s, Target and Walmart.
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3. Technology in Stores To Drive Productivity and Engaging Experiences
Coresight expects to see an acceleration of in-store technologies in 2025, driven by advancements and growing consumer demand for seamless retail experiences. For instance, in-store technologies such as electronic shelf labels are poised to uplift revenues, while smart shopping carts equipped with AI-driven recommendations could increase basket sizes by delivering personalized suggestions to customers in real time. Additionally, according to proprietary Coresight Research survey data, the availability of multiple shopping channels increases the likelihood of returning to a retailer as a repeat customer for more than one-third of U.S. consumers.
4. (Generative) AI To Revolutionize Retail
Coresight also expects GenAI (generative AI) use in the retail space to expand rapidly in 2025—as more than 50% of retail companies are ramping up their GenAI investments in 2025 and beyond, according to Coresight Research estimates—driving radical transformations across the U.S. retail market. For instance, Coresight expects using GenAI for optimal production to become the norm, while companies’ dynamic pricing strategies will be sharpened by GenAI’s ability to accurately track competitor pricing in real time.
5. Impact of GLP-1 Drugs To Demand Retail Reinvention
Coresight expects the widespread adoption of GLP-1 (glucagon-like peptide-1) medications such as Ozempic to have a significant impact on consumer behavior and the U.S. retail landscape overall in the short to medium term. Coresight Research projects that 12 million Americans will use a GLP-1 medication by 2030.
These medications promote weight loss and healthier lifestyles, meaning there will likely be a decline in demand for high-calorie foods and plus-size apparel, as well as increased demand for health-conscious products, wellness services and athleisurewear.
6. Leading with Data and Unied Commerce
In 2025, Coresight anticipates that a substantial proportion of retailers will move toward a unified strategy that supports seamless transitions between touchpoints, shifting away from siloed channels. This integration of additional channels will create more impulse-buy and upselling opportunities—according to a proprietary Coresight Research survey, almost one-quarter of U.S. consumers stated that their overall spending has increased either significantly (8.2%) or slightly (16.6%) as a result of engaging with retailers across multiple channels.
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What these trends portend:
Coresight recommends that brands and retailers must focus on long-term significance and resonance by working to understand consumer behavior and adjusting their product portfolios, marketing tactics and overall shopping experiences to cater to the shifting needs and preferences of their shoppers.
This is particularly critical during phases of economic unpredictability, such as the one currently facing the U.S. However, maintaining credibility in the current retail space demands sustained dedication: shoppers are quick to detect any lapse in commitment from a retailer, especially when that company allows short-term gains to overshadow its long-term objectives and consumer demand.
Retailers should also look to leverage retail media, marketplaces and data sales to extend their brand effectively into new service realms. While these offerings will create new revenue streams, it should be noted that these types of extensions require a strong brand reputation that will entice both new commercial partners and consumers.
Amazon, Kroger, Target and Walmart, with their growing retail media businesses, could likely witness an increase in revenues and margins. These retailers should partner with tech rms to better track data across platforms, which can enhance return on investment for advertisers.
Companies that plan to sell or license proprietary technologies or software solutions to other businesses will generate additional revenue streams. For instance, Shein currently offers “supply chain as a service” for third-party brands and retailers.
Strengthened marketplace capabilities will help traditional retailers such as Macy’s, Target and Walmart to further gain share of the total retail market, as well as better compete against Amazon. Coresight expects Shein and Temu to continue to maintain their competitive edge in this space despite a recent U.S. government proposal to remove import subsidies, such as the de minimis rule.
In the wake of the Ozempic economy, organic and specialty-focused grocers, such as Whole Foods Market and Sprouts Farmers Market, could benefit from the shift toward healthier eating seen among many GLP-1 users.
Retailers investing in unified commerce platforms, such as Kraft Heinz and Ulta Beauty, will likely benefit from the seamless integration of back-end operations with all consumer touchpoints.
Brands and retailers that do not adapt to rapidly changing consumer behavior and market trends risk falling behind in U.S. retail. Perhaps most importantly, those slow to embrace emerging technologies, digital platforms and innovative e-commerce strategies—such as GenAI and store digitalization—will find it difficult to engage with modern consumers effectively.