Day three at NRF: Unpacking retail’s global future

On the third and final day of the National Retail Federation’s conference, Retail’s Big Show, attendees packed in a few more presentations and last-minute insights from retail’s established and emerging leaders. 

Panels on “Global forces shaping the retail business landscape,” moderated by Andrea Bell, vice president of consumer insights at WGSN, and “The Vogue Business Index: Luxury’s new global gateways,” moderated by Anusha Coutiggane, head of advisory at Vogue Business, were particularly enlightening. 

2026: the year of redirection

In her presentation, WGSN’s Bell predicted that 2026 will mark a year of redirection, caused by a variety of factors, from political shifts to evolving life milestones.

She broke down the six drivers of change and progress mapped out by WGSN’s Stepic methodology, which tracks developments in society, technology, the environment, industry, and creativity, that are expected to affect the retail industry moving forward. 

  • Age spectrum 

One of Bell’s predictions is that “age-related stereotypes will be dismantled as we embrace a more intergenerational world”. 

With a rapidly aging population in countries like China and Japan and many younger consumers following a different life plan, from delaying having children or choosing to remain child-free to living with their parents until a later stage in life, retailers must learn to adapt to these different expectations. 

Bell advised retailers to “challenge chrono-normativity” and lean into creating adaptable products and services that cater to consumers of diverse lifestyles, work setups, evolving care ecosystems, and more.

One example is Femmze, an age-inclusive undergarment brand that provides support for anything from bladder leaks to irregular flows or for extra support postpartum. 

  • Intentional tech

According to Allied Market Research, the global virtual humans market was valued at $11.3 billion in 2021 and, as Bell pointed out, the market is projected to reach $440.3 billion by 2031. 

Like it or not, retailers will need to adapt to a world that is becoming increasingly focused on artificial intelligence (AI) while keeping in mind the impact of AI on the general public and the need for further development, especially around diversity. 

Bell shared the story of an Asian-American MIT graduate student who was using an AI image creator to edit her photo to be more professional. Instead, the program moulded her features to look more like those of a white woman. 

Bell said that brands should clearly state when an image or video has been edited or created using AI tools to combat disinformation.  

  • Polarised consumption 

As consumers become increasingly interested in and aware of eco-responsibility and more intent on prioritising the purchase of sustainable products over more affordable options, retailers need to adapt to these shifts.

“As more political and economic divisions widen more people will be choosing ethics over aesthetics,” Bell said. 

Retailers not only need to invest in creating eco-friendly products and services but also reward customers for their ethical efforts.

Bell shared the story of Plastic Bank, an initiative that encourages the exchange of plastic waste for money, goods, or blockchain-secured digital tokens to encourage recycling and other “green” actions. 

  • Geopolitical tensions

With 64 elections set to be held worldwide in 2024 alone, Bell emphasised that the year ahead is expected to be a big one for social and political change. 

“Emerging trade alliances are shaping a new geopolitical order, challenging the endurance of traditional superpowers,” the analyst said.

She pointed to the growing wealth gap, which sees 54 per cent of wealth going towards the 1 per cent, while 0.7 per cent of wealth goes towards the poorest half of the global population, creating a two-tiered society of haves and have-nots.

In a time of political unrest and overwhelming inequality, retailers need to further address these disparities and “acknowledge the backlash against corporate ‘greediation,’” Bell insisted.

  • World-building

As the world becomes more globally engaged across cultures and languages, retailers need to embrace a future without traditional borders in place, such as language.

Bell noted Spotify’s recent development of an AI-powered tool that enables a podcast to be translated into a wide variety of languages beyond the original language with which it was recorded. 

Overall, Bell encouraged the room, and the retail industry at large, to figure out how to address the gaps caused by generational differences and economic imbalances, reward ethical consumer habits, and strive to envision ways to build a better world through the use of creativity and AI.

Luxury’s new global gateways

Where Bell’s lecture offered a long-term view of the changing state of the retail industry, Coutiggane’s revelations were more centred on geographic areas of opportunity for businesses to consider and explore. 

Vogue Business’ fashion market expert suggested that luxury retail will decelerate as consumers become more cautious about indulging in luxury items. 

A few statistics Coutiggane brought up from Vogue Business Index’s research revealed:

  • Lower frequency: 40.7 per cent of consumers will shop less for designer fashion if prices increase.
  • Reduced spend: 25.6 per cent stated they plan to switch to less expensive brands. 
  • More pre-loved: 35.3 per cent will buy more via resale channels. 

The Index analysed 60 top luxury fashion brands by revenue, 11 markets (China, Japan, South Korea, UK, France, Italy, Germany, Spain, Brazil, and the Middle East), and over 160 data points across consumer perception, omnichannel, digital, innovation, financial results, and environmental, social, and governance (ESG). The results revealed three global gateways for retailers to explore: 

  • Brazil

Brazil’s recently passed tax reforms, which will replace five separate consumption taxes with a dual value-added tax system throughout 2026 to 2033, are an opportunity for retailers to engage in this previously complex market. The anticipated tax ceiling is predicted to drop from 34.4 per cent (current sum of overlapping duties) to 27 per cent. 

A Brazilian brand that Coutiggane suggested retailers should be aware of is Farm Rio. A 25-year-old brand that currently operates 86 stores in Brazil, and has expanded to New York City, Miami, and Los Angeles in the past five years, it follows several core consumer trends including sustainability. Farm Rio became a Certified B Corp in October 2023, and is a proponent of the “dopamine dressing” aesthetic. 

  • South Korea

In addition to being a strong hub for cultural and fashion influence (e.g. K-pop, K-beauty, etc.), South Korean customers have a strong interest in luxury fashion labels on a level that rivals China. 

Coutiggane directed the audience to data gathered by Morgan Stanley that shows South Korean consumers spend $325 per capita on luxury goods, versus China ($55) and the US ($280). 

Other points of evidence that highlight South Korea’s value as a global market is the recent news of Coupang’s $500 million acquisition of Farfetch and the percentage (54 per cent) of South Korean luxury consumers who are excited about brands introducing resale. 

  • The Middle East

While the Middle East has been an area of interest for the luxury retail industry for several decades, recent reports predict an upcoming boom in sales from this region.

According to a survey conducted by Boston Consulting Group in partnership with Altagamma, the association of Italy’s top luxury labels, the luxury market in the Middle East will double from approximately $16.5 billion to $38.5 billion from 2023 to 2030.

Citing details such as Saudi Arabia’s fairly young population, 63 per cent of whom are under the age of 30, and the distinct characteristics and needs of each territory in the Gulf Region (e.g. Qatar and the United Arab Emirates have strong expat populations, while Kuwait is all about local consumers), Coutiggane said that retailers interested in investing in this region must avoid treating the Middle East as a monolith.

Whether it’s investing in a new country, as Coutiggane suggested, or exploring ethical and humane AI efforts, as Bell encouraged, retailers certainly have an interesting and potentially profitable year ahead of them.

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