ent of the total advertising market in the US, a major spike from just 17 per cent in 2023. This growth will be largely driven by more brands viewing retail media as a key channel for performance-driven advertising, ranking alongside traditional formats, such as social media ads. Anand Kumar, Coresight’s associate director of retail research, suggested that as retailers monetise their intellectual property, retail-as-a-service will result in more retailer-to-retailer and retailer-to-brand vendor relationships in areas such as fulfillment technologies and services, supply chain expertise, marketplace integration and end-to-end e-commerce platforms. The advisory firm projects that companies, especially those within the low-margin grocery sector, could see their base margins double or even triple depending on how well they scale their retail media businesses.  Two key areas where retail media could unlock opportunities include in-store media and shopper data as a profit center. With the first, Coresight Research recommended that retailers should focus on in-store media opportunities while keeping promotions distinct from retail media.  Even though most retail transactions occur in physical stores, retail media currently thrives on the rich shopper data found online, which is limited within stores. To close the online/in-store data gap, retailers could adopt personalised messaging technologies, such as smart-cart screens. However, retailers must first improve their measurement capabilities to fully tap in-store opportunities, Kumar advised.  With the second key area, retailers may need to shift from treating shopper data as a secondary asset to making it a core drive of profitability. Coresight Research estimated that retailers can generate $1-5 million from data monetisation for every $1 billion they earn in revenue.  However, this change would come with some risks, particularly around customer loyalty, as it would mean shifting away from customer service and toward data monetisation. 2. E-commerce marketplaces to gain share In 2025, Coresight Research expects online marketplaces will capture an even larger share of retail sales, and may even potentially outpace traditional retailers, as consumers continue to favour the convenience and competitive prices that platforms like Shein and Temu offer. On the other hand, Coresight Researched said that changes to the “de minimis” threshold, the threshold below which imported goods are exempt from duties and taxes, could affect cross-border retail, especially for marketplaces such as Shein and Temu. For example, a reduction from the current threshold ($800) to a lower amount would likely lead to increased costs for sellers and higher prices for consumers.  Cross-border platforms may experience slower growth as these regulatory changes take effect, with some small or low-cost sellers finding it challenging to maintain their competitive prices. Additionally, Coresight Research expects more retailers to form strategic partnerships with other e-commerce platforms to reach a broader audience while expanding the product assortment available on their sites. The advisory firm cited Target’s partnership with e-commerce platform Shopify, established in June 2024, which allows merchants to feature products on Target Plus, the retailer’s third-party online marketplace.  With the rise of online marketplaces, retailers should invest substantially in various technologies to scale their platforms, such as AI-driven search and recommendation engines and the integration of new payment gateways. 3. Technology in stores to drive productivity and engaging experiences Thanks to growing consumer demand for seamless retail experiences, Coresight Research predicts three types of technologies — namely digital screens, electronic shelf labels (ESLs) and smart shopping carts — will play key roles in the digital transformation of bricks-and-mortar stores in 2025.  In addition to allowing retailers to adjust pricing dynamically based on market, trends, promotions and real-world events, ESLs can also improve the shopping experience by offering customers extra details, such as stock levels and product expiration dates. They can also help store employees via “pick-to-light” technology, which uses small lights to highlight items in a customer’s order, enabling faster and more efficient order fulfillment. Smart shopping carts equipped with AI-driven recommendations, such as the type that online grocery delivery and pickup service Instacart rolled out in early 2024, could increase basket sizes by delivering personalised suggestions to customers in real-time.  4. (Generative) AI to revolutionise retail The use of GenAI in retail is expected to expand rapidly, with more than 50 per cent of retail companies ramping up their GenAI investments over the next few years. Coresight Research estimates that the combined market for GenAI hardware and applications will grow by 57 per cent year-over-year (YoY) in 2025 to reach a total of $125.0 billion.  Additionally, the advisory firm estimates that the GenAI applications segment, which includes GenAI models, will grow nearly two times in 2025, recording YoY growth of 106.3 per cent and outpacing the hardware segment, which will see 40.9 per cent YoY growth in 2025. GenAI-driven product design and demand forecasting processes may enable retailers to stay ahead of consumer trends and minimise waste as the technology can leverage massive datasets on customer preferences to produce valuable insights.  Additionally, companies’ dynamic pricing strategies are likely to be sharpened by GenAI’s ability to accurately track competitor pricing in real-time, offering data-driven insights that brands and retailers can use to optimise their pricing and promotions.  Given these benefits, Coresight Research estimates that GenAI-powered tools have the potential to not only increase retailers’ overall revenue, but enhance their profit margins as well. 5. Impact of GLP-1 drugs to demand retail reinvention The widespread adoption of glucagon-like peptide-1 (GLP-1) medications, such as Ozempic, are expected to have a significant impact on consumer behaviour and the US retail landscape overall over the next few years.  Coresight Research projects that 12 million Americans will use a GLP-1 medication by 2030, which will promote weight loss and healthier lifestyles. This means there will likely be a decline in demand for high-calorie foods and plus-size apparel, as well as increased demand for health-conscious products, wellness services and athleisurewear. This shift will benefit sports and athletic apparel retailers, such as Lululemon Athletica and Urban Outfitters, as well as sports and fitness equipment vendors. However, in the medium term, the heightened use of this medication indicates that the plus-size category will likely witness a decrease in demand as more consumers lose weight. 6. Leading with data and unified commerce In 2025, a substantial proportion of retailers will move toward a unified strategy that supports seamless transitions between touchpoints, shifting away from siloed channels. The integration of additional retail channels is likely to create more impulse-buy and selling opportunities.  According to a proprietary Coresight Research survey, almost one-quarter of US consumers stated that their overall spending has increased either significantly (8.2 per cent) or slightly (16.6 per cent) as a result of engaging with retailers across multiple channels. Two key technologies that Coresight Research believes will enable unified commerce are customer data platforms (CDPs) and radio-frequency identification (RFID). With CDPs, the tech is able to provide retailers with a unified view of customers, solving the problem of data fragmentation.  This unified view leads to a complete understanding of customer behaviour, allowing retailers to uncover previously unidentified profiles, derive deeper segmentation insights for enhanced personalisation and and improve marketing campaigns through more precise targeting.  Over the next few years, Coresight Research expects retailers to leverage CDPs to gain these deeper insights, a journey that some retailers, like Walmart with its data insights platform, Walmart Luminate, have already begun. With RFID tech, retailers will be able to attain extensive supply chain oversight, which in turn enhances decision-making and allows for proactive management of potential disruptions. This will also enable retailers to minimise out-of-stocks and enhance overall supply chain efficiency.  These benefits are especially crucial for retailers providing omnichannel fulfillment options, as RFID technology helps reduce buffer inventory, resulting in better prices and profit margins. Lessons retailers can take with them into 2025 Regardless of what type of tech retailers invest in, Coresight analyst Kumar explained that in 2025, “brands and retailers must focus on long-term significance and resonance by working to understand consumer behaviour and adjusting their product portfolios, marketing tactics and overall shopping experiences to cater to the shifting needs and preferences of their shoppers.” This is particularly critical during phases of economic unpredictability, such as the one currently facing the US, Kumar noted. However, he warned that maintaining credibility in the current retail space demands sustained dedication. Kumar explained that shoppers are quick to detect any lapse in commitment from a retailer, especially when that company allows short-term gains to overshadow its long-term objectives and consumer demand. One way that retailers can build credibility with consumers, Kumar suggested, is by leveraging retail media, marketplaces and sales data to extend their brand more effectively into new service realms. By building a stronger brand reputation, new commercial partners and consumers alike will be enticed to check out or further connect with a retailer.  Kumar also warned that the brands and retailers that don’t adapt to rapidly changing consumer behaviour and market trends are most at-risk of falling behind in the US retail scene.  Without embracing emerging technologies, digital platforms and innovative e-commerce strategies, such as GenAI and store digitalisation, retailers will find it incredibly difficult to engage with modern consumers effectively, Kumar concluded.