The key focus for retailers is stimulating growth and covering costs by reigniting revenues amidst an improving economy, says Circana in its ‘Rewired: Finding growth in the future of retail’ Outlook Report.
“Shoppers are looking for escapism with their purchases, which is why they are looking for goods that feel nostalgic; brands need to turn up the emotional volume to provide comfort and build trust with today’s shoppers,” according to Circana.
“Inspiration and aspiration are other fundamentals brands need to deliver to elevate moods and help shoppers achieve their goals. Amplifying affordability and bringing out-of-home experiences into the home are important to make these ideals more accessible to shoppers.
“Self-care is shifting from being reactive to more proactive with shoppers seeking out these activities more than ever. For brands, it is a race to resilience amid the economic turmoil so adapting to these three factors driving shoppers is crucial to success in 2025.”
Alistair Leathwood, Head of Media Analytics and Insights, Circana says the outlook for 2025 is optimistic for the retail industry however, there are some strategic imperatives brands need to focus on to see growth.
“Optimising the experience economy is key as shoppers want ultimate value from their purchasing decisions. Brands will need to capitalise on the power of subconscious commerce to engrain themselves into daily life,” he said.
“Sustainability is a huge priority for most shoppers so investing in the ESG ecosystem and circular retail are key to building loyal customers today. Another imperative is to reconfigure supply and shift to an elastic brand model, expanding or contracting based on demand.
“There is a lot for brands to consider but doing this early in the year will set them up for success and potential growth as the economic pressure is set to ease slightly,” said Mr Leathwood.
Advanced analytics and rapid delivery will allow retailers to anticipate and fulfil consumer needs and create the desired hyper-personalised experiences.
Data will play a key role in supporting brands to deliver on the key drivers for consumers and address the strategic imperatives.