As we step into 2025, it’s time to cast a gaze into the future and explore the emerging trends we see as set to shape the retail landscape and redefine consumer behaviour.

From seismic shifts in technology to evolving shopper expectations, the year ahead promises plenty of opportunities and challenges. So, in no particular order, here are some of the top emerging trends we’re keeping a close eye on.

1. Everyone’s a Sceptic

Last year we saw consumers purchasing, but in a much more considered manner. Coming into 2025 consumers are now savvier than ever before. They’re researching products before buying them using every touchpoint available. We’re seeing terms like shrinkflation enter consumer vocabularies and the growing awareness of deceptive / illusory discounting practices, particularly with supermarkets and off the back of Black Friday sales. And when it comes to online shopping, consumers are sceptical of fake or AI-generated reviews, search results cluttered with ads and fake bots online; to which we’re seeing huge growth in platforms like Reddit as a result.

This heightened degree of scepticism with consumers isn’t likely to go away soon. In 2025, it’ll be more important than ever for brands to work to build trust and transparency with consumers.

2.         The Continual Push For Value and Further Rise of Chinese Marketplaces
Value will continue to be a key consumer driver throughout the year. Whilst we think 2025 might give consumers some reprieve to the cost-of-living crisis, particularly as inflation comes under control and reductions to interest rates are on the cards, the reality is consumers are still (and will continue to) feel the pinch. This will have a large impact on retailers here in Australia. Whether through the growth in private label / off-brand options, the middle market squeeze (e.g. consumers trading down or up), but particularly the growth of Chinese, or direct from manufacturer, marketplaces. These marketplaces achieve their cheap prices by effectively going straight to the factory, cutting out margin along the value chain.

Of the top seven e-commerce marketplaces around the world, six are Chinese. 2024 saw further significant growth of these Chinese platforms. It was predicted that Temu, Shein, AliExpress and TikTok accounted for over 20% of all global purchases during the holidays. And we expect this trend to continue throughout 2025. Particularly as consumers continue to seek out value, awareness grows of these platforms and consumers generally feel more comfortable purchasing larger ticket items.

To compete with these direct from manufacturer marketplaces, it’ll be more important than ever for brands to communicate value to consumers and build strategies to combat these platforms (e.g. competing with them through service and quality).

3.         Replicating The ‘Taylor Swift’ Effect

Taylor Swift’s sold-out concerts in Sydney and Melbourne last February had a temporary, but significant impact on Australian retail sales. With the concerts attracting over 600,000 fans, ABS reported a 0.3% increase in retail turnover, which was attributed to the concerts. In particular the clothing, footwear, and personal accessories sectors saw the biggest increase at 4.2%. 

The Matildas’ 2023 FIFA Women’s World Cup performance also had a huge impact on Australia’s retail industry, generating a $7.6 billion economic boost. 

Outside of big sales periods such as Black Friday, retailers and brands are now recognising the importance of these big events on the retail calendar. The question is what will be the next ‘Taylor Swift’ event for 2025, and how do retailers / brands authentically find alignment?

4.         The Continual Evolution of The Health And Wellness Category (with a particular focus on Ozempic)

The global wellness market is valued at over $1.8 trillion and is growing at an annual rate of 5% to 10% - and in 2025, we can expect ongoing evolution within the category. 

On one side, we have Baby Boomers and the growth in ‘re-active’ health and wellness. More than half of Boomers have a long term health condition, which is only expected to increase into the future.

And with younger consumers we’re seeing a more proactive approach to health and wellness – particularly around mental, spiritual and specific female wellness (fertility, sexual wellness etc).

Furthermore, we need to talk about the impact of Ozempic and other weight loss drugs. Morgan Stanley is predicting that as much as 9% of the US population will be taking the drugs by 2035 (1 in 10 people), poised to reach $100 billion. 

The impact of these weight loss drugs on retail is expected to be significant and wide reaching, with many predicting it will be a bigger trend than AI. Early research suggests that categories such as food, alcohol, F&B, gyms / fitness and clothing will be hit as there will be a large shift in consumer behaviour and sizing.

5.         ‘Onomatoplay’ Retail

In 2025 we’ll continue to see the evolution of experiential in-store retail. The next evolution? Onomatoplay Retail. That is, the blending of auditory cues with make-believe to turn shopping into an immersive and memorable experience.

Take the Jellycat Diner at FAO Schwarz in New York. This whimsical fake diner brings Jellycat’s food-themed plush toys to life. Store staff in diner uniforms “cook up” the toys, simulating cooking sounds and actions, mimicking how children naturally play.

Onomatoplay Retail is an opportunity to make the shopping experience more than transactional – it’s about creating emotional, memorable moments. In 2025, smart retailers will harness the ‘power of play’ to captivate customers and elevate in-store experiences.

6.         Experiential Loyalty: More Than Just Points

Customer loyalty is now more important than ever. But loyalty isn’t just about points anymore – it’s about creating unforgettable experiences.

An experiential loyalty program goes beyond traditional points-based systems. Instead of just earning points, customers gain access to exclusive events, personalised experiences, or once-in-a-lifetime moments. It’s about building emotional connections that foster real, long-term loyalty. 

2025 will be year that we see many retailers rethinking their loyalty programs – moving away from transactional (i.e. points) based programs to creating experiences that customers won’t forget.

7.         Bigger Isn’t Always Better

In 2024, US retail giants like Macy’s, IKEA, Best Buy, Target, Kohl’s, and Whole Foods embraced the small-format trend. Why? To reach shoppers in areas where their massive big-box stores don’t exist.

But it’s not just about downsizing – it’s about localisation. These small-format stores focus on curated product selections tailored to local tastes, creating a more personal, relevant shopping experience.

This approach helps retailers connect with communities, offering a hyper-localised merchandising strategy that truly resonates with customers at a more personal level. Not to mention, how these stores link with online to create mini distribution hub networks. The future of retail in 2025? Smaller, smarter, and stores that are closer to home.

8.         Growing ‘Influence’ of The Influencer and TikTok Shop

When it comes to influencers, we’ve only seen the tip of the iceberg.

In 2025, influencers will continue to blur the lines between content creators and brands. No longer just endorsing products, many are evolving into standalone brands, launching their own product lines, and solidifying their status as celebrities. The shift is reshaping how consumers engage with influencers, who now offer authenticity and relatability alongside the aspirational allure of traditional celebrities.

At the same time, platforms like TikTok Shop are gaining traction, making it easier for influencers to seamlessly integrate product recommendations with instant purchasing. The result? A powerful combination of entertainment and e-commerce that is reshaping the path to purchase.

For Australian retailers, this trend highlights the need to rethink how they collaborate with influencers. The opportunity lies in forging genuine partnerships, co-creating products, or leveraging platforms like TikTok Shop to tap into these growing digital ecosystems. It’s no longer just about visibility – it’s about building relevance in the influencer-driven retail landscape.

9.         Getting Returns Right

Returns continue to be a major profit drain for online retailers, and fixing this will become a priority for retailers and brands in 2025. In 2024, returns were estimated to make up 17% of all merchandise sales (almost 1 in 5), totalling $890 billion globally. This issue is reshaping shopping behaviours and retail strategies worldwide.

To tackle this, retailers are tightening return policies, shortening return windows, and introducing restocking fees. Others are innovating with ‘keep it’ refunds or buyback programs like Patagonia’s Worn Wear. These represent a key trend for 2025: balancing convenience with sustainability. Return policies are no longer just a post-purchase formality, they’re shaping consumer shopping habits, especially for Gen Z and millennials.

10.         The ‘Great Generational Wealth’ Transfer Is Beginning to Play Out with Consumers

$3.5 trillion - that’s the staggering value of wealth expected to transfer from one generation to the next in Australia over the coming decade.

However, rather than a single 'one-off' shift, this transfer has already begun, with noticeable ripple effects taking shape. Its impact on both retailers and brands is set to grow throughout 2025, driving significant changes in consumer behaviour.

For example, Baby Boomers are helping their adult children enter the property market, while shifting trends in the travel industry reflect a rise in multigenerational travel and shared experiences.

The Great Wealth Transfer is underway - but not in the way we’ve traditionally thought. Its influence on retailers and brands will only continue to expand throughout 2025.

What do these emerging trends mean for your brand? Contact us to discuss.