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As we enter the midpoint of the decade, the resilience of the retail sector is on full display. In recent years, it has weathered a global pandemic, economic uncertainty and geopolitical turbulence while continually enhancing cross-channel experiences to meet the ever-evolving expectations of consumers worldwide.

Looking ahead to 2025, the future of retail shines brightly. Despite a dynamic global landscape, emerging digital technologies – from Generative AI (Gen AI) to advanced virtual platforms – are equipping retailers with tools that engage people in all-new ways, building offerings that are more immersive, personalized and progressive than ever before.

Here, we explore six trends that promise to re-shape retail in 2025 and beyond.

The Power of AI-driven Chat

1. The Power of AI-driven Chat

In 2025, Gen AI-powered assistants will revolutionize the shopping landscape. As text-based AI-led chatbots and virtual assistants become increasingly intelligent, their use cases are evolving from answering queries to offering real-time, hyperpersonalized shopping recommendations both online and in physical stores.

Sephora is one brand paving the way, utilizing AI-powered chatbots to help customers with product recommendations, enhancing the shopping experience across all channels.1 Perplexity, meanwhile, is an AI commerce platform that combines conversational prompts and image inputs to help users research products, compare reviews and access detailed product cards.2

Customers aren’t the only ones feeling the impact. Target’s Store Companion is just one example of Gen AI-powered chatbot tools augmenting store staff with the insights they need to excel in their roles.3 This creates a highly personalized shopping experience, capable of deepening customer connections, boosting conversion rates and increasingly loyalty if harnessed optimally.

Another example of the growing power of chatbots in retail is the increasing use of assistants that provide in-chat purchases, allowing customers to complete transactions without leaving the conversation. Amazon’s Gen AI-powered chatbot Rufus is one such example, capable of helping users find specific products or check availability and placing orders on a customer’s behalf directly from the chat.

V-Commerce Rising

2. V-Commerce Rising

Voice-based shopping or V-Commerce is set to become a mainstream retail channel in 2025. This technology allows consumers to make purchases, receive personalized recommendations and manage orders using voice commands.

V-Commerce has been gaining traction as AI assistants and Machine Learning (ML) models evolve, with the channel gathering significant momentum: Research shows the global voice commerce market, valued at USD108 billion in 2024, is expected to grow at a compound annual rate of 27 percent through 2031.4

Apple Intelligence exemplifies how technology is unlocking v-commerce's potential. By enhancing Siri with advanced natural language capabilities, Apple has enabled users to interact seamlessly with an AI assistant. With insights from browsing history, purchase patterns and social media activity, Siri can now provide highly personalized shopping recommendations and even predict future purchases.

Beyond the home, SoundHound AI is bringing similar capabilities into vehicles. Its system allows drivers and passengers to order takeout for pick-up directly from the car’s infotainment system through voice commands, representing the first-ever in-vehicle V-Commerce platform.5 With this kind of engagement just kicking off, retailers should consider how customer expectations might evolve and ensure that the optimal tech-human blend is in place as they transform their customer interactions.

Subscription Retail

3. Subscription Retail

With advancements in intelligence, 2025 is poised to be a transformative year for subscription retail, marked by sustained growth and the introduction of increasingly personalized models across diverse product categories. This shift is primarily fueled by younger consumers, with research indicating that four in 10 millennials already rely heavily on retail subscription services for their daily shopping needs.6

What’s driving this? Many forces are driving the growth of subscription. Still, fundamentally, it enables a different type of retail relationship and increases the value that retailers can provide – such as automatic replenishment, the surprise factor, exclusivity, perks, discounts and elevated customer service. While these benefits can also be delivered through in-store experiences, online channels or loyalty programs, subscriptions represent a deeper level of customer commitment, allowing retailers to unlock even greater value and tailored offerings.

The subscription explosion is encouraging new players to throw their hats into the ring, with high-end department store Fortnum & Mason’s biscuit, tea and jam offerings epitomizing the shift away from staples to luxury products.7 Predictive analytics sits at the heart of successful subscription models, providing retailers with a comprehensive view of its members’ demographic and psychographic profiles, enabling them to anticipate needs and optimize offerings.

A robust data-driven foundation will be essential in this space, as consumers who rely heavily on retail subscriptions are often the least tolerant of subpar experiences. For instance, customers using scheduled delivery or auto-fill services are significantly more likely to cancel their subscriptions if an order is canceled due to an item being inaccurately listed as in stock.8 Get it right, however, and retailers can reap substantial benefits, including recurring revenue, sustained growth and deeper engagement with customers into 2025 and beyond.

Loop Life

4. Loop Life

While AI’s transformative potential often centers on enhancing experiences, it is equally revolutionizing possibilities in sustainability. Already a powerful tool for education and curation, AI could make 2025 the year it bridges the gap between environmental awareness and sustainable action. By simplifying the adoption of circular principles, AI is poised to help retailers and consumers close the loop and easily embrace more sustainable practices.

Leading retailers are already harnessing AI, advanced analytics and domain expertise to drive sustainable transformation. Examples are myriad and wide-ranging, from minimizing waste through AI-led insights to boosting supply chain transparency and oversight over the sustainable performance of suppliers and partners through AI tools.9,10,11

AI is already making sustainable choices more accessible, and by 2025, it is set to re-shape individual behaviors and broader consumption patterns. Many consumers now expect AI to play a pivotal role in sustainability, with 41 percent anticipating that it will help them identify products aligned with sustainable or ethical production practices.12

Metaverse Malls

5. Metaverse Malls

2025 will see retailers double down on immersive shopping experiences in the metaverse, allowing customers to browse and purchase products in Virtual Reality (VR) environments. This era of metaverse shopping represents the culmination of what’s long been touted as ‘phygital retail’ – where URL and IRL (In Real Life!) really blur for ultimate immersion, upending distinctions between bricks-and-mortar and e-commerce.

The ability to shop in virtual environments – or the metaverse malls of 2025 – is something that consumers are already seeking out. According to research, 31 percent of US consumers want to shop via VR as an alternative to bricks-and-mortar shopping.13 And leading businesses have clocked this interest, with a majority of brands (55 percent) planning to increase investments in immersive experiences through to 2026.14

Amazon is one company at the forefront of metaverse retail innovation. Its Virtual Holiday Shop is a 3D shopping platform designed to offer customers an immersive experience during the invariably stressful holiday shopping season, with shoppers able to visit different themed showrooms and browse highly-rendered digital versions of products.15 IKEA, meanwhile, has introduced a virtual store on the Roblox platform, featuring pixelated versions of real-world staff who assist customers in navigating the digital space.16 This includes a team of paid IKEA workers to staff the virtual store.

For retailers, metaverse malls represent a new era of shopping. By combining this experiential potential with ML models and real-time customer behavior, immersive environments can respond seamlessly to customers’ unique profiles and experiences, delivering hyperpersonalized interactions that foster deeper engagement and drive sales.

Robot Retailers

6. Robot Retailers

Over the past decade, advanced human-like robots, such as Tesla Optimus, Figure AI and Softbank Pepper, have rapidly matured, leveraging breakthroughs in AI and engineering. Store robots are evolving from box-like machines to humanoid forms, capable of walking, talking and accessing vast amounts of critical data, including product information, FAQs and customer loyalty details.

Retailers like Carrefour and Lowe’s have already explored early deployments of customer-facing robots for guidance and information. However, these robots are set to take on more complex roles, such as in-store customer service, product information delivery, payment handling, re-stocking and even sales.

Despite these advancements, challenges remain, including customer hesitancy and brand implications tied to visibly automating human roles. As a result, many robots are likely to stay behind the scenes in storerooms and warehouses, where non-humanoid robotics have been key for retailers like Ocado, Amazon and Walmart for years.

While humanoid robots are not yet deployed at scale, their costs and reliability are steadily improving. In 2025, shoppers may experience their first encounters with retail robots, marking the beginning of a new chapter in retail innovation.

Preparing for the Retail Revolution

The opportunities to drive transformation within retail are significant. Retailers must prepare for 2025 and beyond by harnessing data and analytics, experimenting with immersive technologies, embracing circularity, boosting transparency and exploring emerging channels.

The real challenge for most retailers lies in progressing toward these next-generation aspirations while keeping operations on course. Leveraging the experience and capabilities of the right partners can help simplify complex transformations, enabling instant access to the latest digital tools and domain expertise. With firms currently leveraging external support expecting a nearly 40 percent increase in collaboration with third-party service providers, those already doing so are reaping the benefits, bringing the future of retail to life.

Ready to embrace the future of retail? Connect with our experts to explore how these trends can transform your business and create unparalleled customer experiences.

References

  1. Sephora Debuts Chatbot Features for Consumers at Home and In-Store | RetailDive

  2. Shop Like a Pro: Perplexity’s New AI-powered Shopping Assistant | Perplexity

  3. Target to Roll Out Generative AI Chatbot for Store Employees | RetailDive

  4. Voice Commerce: The Next Frontier in Retail | Retail Technology Innovation Hub

  5. SoundHoundAI Debuts Its First-ever In-Vehicle Voice Assistant with On-the-Go Food Ordering | Business Wire

  6. 4 in 10 Millennials Rely Mainly on Retail Subscriptions for Everyday Shopping Needs | PYMNTS

  7. Fortnum & Mason Launches New Tea Subscription Delivery Service | The Grocer

  8. 4 in 10 Millennials Rely Mainly on Retail Subscriptions for Everyday Shopping Needs | PYMNTS

  9. Wasteless AI Launches in 640 Carrefour Stores in Argentina | ESM

  10. Holland & Barrett Strike Provenance Deal for Green Labelling | Tech Informed

  11. Watches of Switzerland Trials AI to Enforce ESG Targets | Financial Times

  12. Sustainable Shoppers Call for AI-powered, Eco-friendly Recommendations | Retail Technology Innovation Hub

  13. 31% of Consumers Want VR to Recreate Brick-and-Mortar Shopping | PYMNTS

  14. Retailers Rank Immersive Experiences Near the Top of Their Investment Priorities | EMARKETER

  15. Explore Amazon’s New Virtual Holiday Shop | Amazon

  16. IKEA is Opening a New Store on Roblox | IKEA

Disclaimer: WNS has sourced the data from various publicly available websites. WNS is not responsible for the content or accuracy of any linked sites.

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