"2025 will be the year where science fiction becomes a shopping reality. From AI-enabled hyper-personalized experiences to the rise of responsive ads via retail media networks to next-gen supply chain automation, the retail industry is transforming on all fronts." - Capgemini
What an exhausting, exciting, inspiring, highly motivating week in New York on the annual pilgrimage to the National Retail Federation retail Big Show to experience the future of retail. For the week, logged nearly 100,000 steps or 42 miles (67.5 Km) in visiting stores, engaging retailers, walking the show floor, meeting analysts, and showcasing new innovations for Sensormatic.
On stage in a Sensormatic sponsored event with the retailer PVH, in my opening comments, I congratulated the audience for working in one of the most vibrant industries in the world. In 2025, the global retail industry will reach nearly $33 trillion, growing at roughly 4% per year through 2026.
By 2026, 76% of total global retail sales will still be physical stores. The growth gap for online sales and stores is narrowing. Growing middle classes in large economies and emerging countries will keep the industry thriving for many years to the come.
This article summarizes my top 5 data supported takeaways from the 2025 edition of the Retail Big Show. One of these trends offers a counter view that needs to be addressed to keep the retail industry positively moving forward. All the quotes cited in this article are directly from attendees or from articles published the same week.
Where Tech and Tears Meet
"There are over 143 million orphans in the world, according to UNICEF. If orphans were a country, they would be the 8th largest....larger than Russia. A child dies every 5.2 seconds....that's over 16,000 children EVERY DAY." - Retail Orphan Initiative (Retail ROI)
For many years now, my retail Big Show week begins at the Retail ROI Super Saturday. This event brings together retailers and solution providers in the perfect blend of the latest technology updates and tears in hearing inspirational stories of how charity organization has improved humanity around the world.
Since 2010, Retail ROI has funded 350 projects in 31 countries with $5.1 million in grants. In total it is estimated that over 363,000 vulnerable children have been helped by this charity.
On the technology front, the IHL Group presented these innovation game changing innovations during the event.
Highly encourage all of you to join us next year as this is the perfect place to start each new NRF Big Show. You will not be disappointed. More importantly, you will be motivated to make your own unique difference to improving the life of others in the world.
My AI Head is Getting Ready To Explode
“AI is becoming transformative for our business, and we really haven’t had a technology revolution as large as this since the start of the internet.” - Doug Herrington, CEO, Worldwide Amazon Stores
As expected, at 2024 Big Show, artificial was the technology everyone was demonstrating and speaking about. A few retail application examples presented by Nvidia:
- L'Oréal is leveraging AI to help their marketing and promotional teams build digital twin assets that gives these creative teams the ability to spin up marketing campaigns faster, test smarter and engage with customers in real time.
- Walmart is using AI to predict, forecast and build inventory levels faster. Demand planning continues to be one of the most complex areas brands must face according to Nvidia.
- Lowe's has built 1700 digital twins models of store layouts to track customer experiences, preference, and buying patterns. All to optimize conversion.
Again, from ROI Super Saturday, here are the AI retail focus areas.
According to new Capgemini research on what matters most to consumers in 2025, three-quarters (75%) say they are open to Gen AI recommendations, compared with 63% last year. An impressive 71% of consumers would like to see Gen AI integrated into their shopping interactions, compared with 56% last year. Sixty-eight percent of consumers have bought products recommended by Gen AI recommendations, compared with 52% last year.
Physical and Digital Continue to Converge
“I think that technology is not the solution. It’s an enabler … when it’s used in the right way, it will only amplify what we have.” - Martin Urrutia, head of global retail experience and innovation, The Lego Group
Technology convergence increased its presence on multiple levels at this year's edition of the Big Show. Remember when we worried about Cloud running retail infrastructure and wanted to keep everything on premise? Microsoft and Google continue to increase their monstrous presence at this retail event.
Amazon also had a much larger presence touting their ability to provide cutting edge retail operations, smart stores, just walk out technologies, digital commerce, and customer obsessed engagement.
Electronic shelf labels were also more prevalent on the show floor. My favorite feature was integration into a store app that would allow the shelf label to flash when you are picking items for BOPIS (Buy Online Pick-Up Instore) reducing store labor.
Even Elon Musk is jumping into NRF with Starlink having a booth in the startups area. It is rumored that multiple major retailers are adopting Starlink for wireless communications.
Digital and physical companies will continue their merging journey. The only limitation is creativity in developing innovative solutions that deliver continued positive return on investment for the retail industry.
The Next Retail Media Frontier is the Store
“Retail media isn’t just an advertising platform; it’s becoming a key lever in how retailers compete and grow.” - Christian Raveaux of REWE Group
On Saturday, just prior to the start of the Big Show, NRF and Stratacache held an all event titled "What's In Store for Retail Media Networks". A standing room crowd participated in an all-day event with multiple global retailers, analysts, and industry experts in discussing the future of retail media.
In walking the show floor, it was clear that retail media continues to increase its importance as a revenue and profit contributor for the industry. This growing presence confirms my view that the next logical, most effective, and profitable frontier for retailers are media networks inside stores.
The reason is very simple. For many retail chains, the audience inside stores is much larger than online.
Leveraging in-store audiences— which are 84% larger than those on digital—will boost results. New Capgemini research finds that consumers want personalized in-store ads via a display in a smart shopping cart, smart mirrors, or interactive touchscreens. Multiple new optional form factors are coming to improve in store media networks.
Catching the Frictionless Commerce Thief
“When you lock things up…you don’t sell as many of them. We’ve kind of proven that pretty conclusively.” Tim Wentworth, CEO of Walgreens Boots Alliance
Above comments are not from an NRF presentation. Rather, they were part of a Walgreens investor presentation. I am including it, as I wrap up the top 5 trends of NRF 2025, because frictionless commerce was heavily present at this year's edition of the Big Show.
Frictionless commerce and retail theft are on a major collision course. Locking up products reduces sales and alarmingly moves business to competitors in multiple of the cases.
Consumers are becoming increasingly impatient. A 2024 study found that less than two-thirds of shoppers will wait for assistance when products are locked up. "This varies by generation, with older shoppers more likely to wait and younger shoppers more likely to shift course. There’s a 19% chance shoppers will shift their purchase online and a 27% chance they’ll switch retailers or abandon the purchase altogether."
While I was impressed with the many examples on the show floor to increase frictionless commerce inside stores, the reality is we have not yet achieved the correct balance between the two opposing forces of extreme consumer convenience and theft.
Another Bright New Retail Year is Ahead
"Retails roots always have and always will be about creating experiences that allow customers to feel something, to believe in something – to be the best version of themselves through the wonders of retail therapy, and the satisfaction of a successful shopping trip." - CMSWIRE
I agree with the opening quote that 2025 will be another year of progress where science fiction will continue to meet shopping reality. The retail industry is indeed transforming on all fronts and it continues to be an exciting time to be part of it. For those that I missed at NRF 2025, my apologies as the schedule was too hectic. Wish you all a prosperous new retail year.
