The 2026 Australian Retail Outlook is out now. This must-read resource is packed with exclusive insights from Inside Retail’s survey of retailers about their performance, plans and predictions for the year ahead.

To give you a glimpse of what you can expect from this year’s report, we are sharing selected articles over the coming weeks. Be sure to download the 2026 Australian Retail Outlook to discover more.

For marketers, 2025 was the year technology underwent its most significant shift since perhaps the rise of Google. In its early months, consumers were playing with apps like ChatGPT to mock up photorealistic toys of themselves, but by the end, AI was becoming not just a way to search for answers online, but an integral part of how we perform our jobs day-to-day.

All of this has created a bizarre paradox, as sceptical consumers crave optimised performance while also yearning for human connection. Or as Grant Davidson, the principal of brand growth at branding agency Principals, puts it, “The brands that will win are those that balance data with distinctiveness by using AI to deepen human connection, not automate it.”

To help marketers sharpen their strategies for an even more transformative 2026, we asked leaders from Australia and around the world to share their top trends – and the best way to navigate them.

The emergence of AI-driven shopping

Towards the end of last year, ChatGPT launched Instant Checkout, a feature that allows users to purchase from stores within its chat without visiting an external site. The mind-boggling technology has the potential to evolve rapidly into one that will not just handle the admin of purchasing, but recommend the best product from multiple vendors. Rachael Wilde, co-founder and CMO of beauty group York St Brands, believes the shift to next-generation purchasing is already well under way.

“More people are now asking AI platforms what to buy than typing into Google, and that shift is only accelerating,” she told Inside Retail. “We’ll see brands start thinking about how they show up in AI search results the same way they think about SEO today. It’s a completely new world where your content needs to be structured for AI to actually recommend you, and I think we’ll eventually see customers being able to purchase directly from inside AI chats, too.”

Yet, as many of our experts have agreed, the brands that succeed will be those that seek to create a genuine connection with their audiences, blending humanity with technology. Wilde argued that while traditional paid media remains important, retailers must also invest in audiences they own.

“When you build trust and connection through community, storytelling, founder visibility, and creator-led content, that attention compounds over time,” Wilde said.

“It takes real investment upfront: consistency, creativity, and teams that can produce content at the same pace consumers scroll. But once it’s scaled, earned attention outperforms any ad budget. It’s more profitable, more resilient, and becomes a brand asset you actually own, not something that disappears the moment you stop spending.”

Embracing experiential moments

The theme of connection is one shared by The Iconic’s CMO, Joanna Robinson. Last year, the local e-commerce giant gathered feedback from 50,000 of its customers to co-design its first loyalty programme, tailoring it to reward shoppers who purchased consciously. At the same time, its marketing campaigns embraced experiential moments that went beyond the changing room.

“We saw an amazing turnout when we invited our customers to outrun our three-hour delivery van with Nike in a 5km running event in winter last year,” Robinson said. “Our customers joined us on the dance floor at our exclusive Summer Sounds event in November to see The Veronicas perform live, and looking ahead, we are in the planning stages of an incredible F1-inspired customer activation for early 2026.”

Perhaps no retailer has conquered those human moments more than global lifestyle giant Anthropologie, which has more than 200 stores in the US and Canada, each uniquely decorated and tailored to the community it serves. The group’s global CMO, Barbra Sainsurin, argued that in 2026, marketing will need to feel more human than ever, with a focus less on reaching customers and more on relating to them.

“Brands that win will blend data with empathy to create experiences that feel personal, emotional, and effortlessly connected,” Sainsurin said. “At Anthropologie, we’ll continue doing what we do best: crafting inspiring in-store moments and bringing that same creativity and warmth to digital. It’s about meeting her with the right product and message at the right moment in ways that feel authentic to her world.”

Fostering an authentic connection with customers

Authenticity is a recurring word in Inside Retail’s discussions. And perhaps no type of brand has to foster it more than those working in fragrances – products designed to be an extension of a consumer’s personality, despite their utterly subjective nature. Jeremy Taylor, CMO at Dusk, argues that while AI will become embedded in marketing and communications, customers will increasingly value authenticity that inspires their purchasing decisions.

“Brands that speak to people genuinely will stand out and build trust,” he advises.

“Even as digital channels dominate, people crave real-world interactions. Retail stores, pop-up activations and immersive experiences will be key for brands in creating emotional connections and memorable moments. Today,” he added, “customers expect more than a transaction. Brands that provide extra value, whether through loyalty perks, gifting, exclusive content or curated experiences, will drive loyalty and repeat purchase.”

Warming to the theme, Courtney Konzelman, VP of marketing at US travel bag brand Aloha Collection, argues that while experiential can take many forms, the goal is to create “shareable moments” that make customers feel they are part of a larger community, rather than simply “engaging in a transaction”. It’s a theme she also sees transferring to the world of influencer marketing, which will shift from pay-to-play partnerships with celebrities to building a community that can connect with consumers.

“Consumers can tell when something feels transactional, so working with creators who have real, engaged and loyal audiences is key,” Konzelman said. “Affiliate and community-based collaborations are a great way to keep that storytelling authentic while actually driving results you can track.”

With in-store, online, social, experiential and now AI marketing to consider, dizzy-headed marketers have every right to be fearful about what the next year will bring. However, Jasmine Allen, head of digital at integrated marketing agency Impressive, concludes that perhaps the best approach is to focus on the basics.

“The most successful brands in this next era won’t be those trying to sell everywhere, but those connecting meaningfully across every touchpoint, turning marketplaces into self-optimising, intelligent profit engines.”

In other words, the key to winning in 2026 will be to keep evolving with technology, while never forgetting that your customers are human.

This story first appeared in the 2026 Australian Retail Outlook.