With NRF’s Big Retail Show coming up in a few short days, all eyes are on the retail space this week – what’s trending, what’s new, how is AI changing the game, and so forth. To help break down what’s happening ahead of the show, we sat down with Adam Blair, Editor at Retail Touchpoints, to discuss what’s top of mind for industry executives.
Adam Blair: Editor, Retail TouchPoints
From AI and tariffs to sustainability and the rise of dupes, read on to see what leaders and innovators in retail and retail tech are focusing on.
Related Read: What Retail Tech Trends Will Rule the NRF Show Floor in 2025?
Reflections on AI Use Cases
Don’t expect to walk by any vendor booths at NRF next week without having them tell you about their latest AI offerings and innovations. While a lot of AI use cases exist today – both in the back-end and in customer-facing applications – there are still many companies that are waiting to achieve ROI on their AI investments.
With that, what have been the most interesting use cases of AI you’ve seen in the retail sector so far?
Adam: One of the more interesting AI use cases popped up just recently: Ulta Beauty’s leveraging of generative AI from Nvidia to provide customers with realistic previews of potential new hairstyles and/or colors for its GLAMlab Hair Try On solution. “For our hairstyle try-on use case, we had to license the model for commercial use, retrain it and put guardrails around it to ensure the AI was only modifying pixels related to hair — not distorting any feature of the user’s face,” Ulta Beauty’s Juan Cardelino explained. To me this illustrates both how powerful gen AI-based solutions can be, but also the preparatory and ongoing work required to make them truly useful to both consumers and retailers.
In terms of consumer acceptance of AI, there are strong indications that many consumers are unaware that AI is already sharpening the product recommendations they receive – or has planned a faster delivery route so that their package arrives on time. In fact, there’s every sign that AI is becoming part of people’s workflows both inside and outside the retail industry, which will pave the way for even greater acceptance by both consumers and industry in 2025.
Reflections on Tariffs and Trade/Disruptions
Since the results of the U.S. election were announced, tariffs have been on every retail and supply chain executive’s mind. How are retailers in the B2B and B2C space preparing for supply chain disruptions caused by potential tariffs in 2025? Are companies more equipped to handle tariffs and other disruptions than five years ago?
Adam: It’s difficult to forecast the impact of tariffs since we don’t have solid information yet on how big they will be nor which goods and countries they’ll be applied to, though it’s a pretty safe bet that China will be a key target of the incoming U.S. administration. The industry also will need to keep an eye on global conflicts that can slow down transportation and logistics, such as the attacks by Houthi rebels that slowed down ship traffic in the Red Sea in 2024.
The overall impact on supply chains from tariffs and other disruptions will certainly be significant. However, it’s important to remember that, since COVID, sourcing professionals have been exploring alternatives to China, which was hit harder – and for a longer time – by the pandemic than many other countries.
The impact of “nearshoring” and alternate suppliers could mitigate the worst impacts of tariffs, including higher costs for brands and retailers that they will pass on to their customers (if they can).
Reflections on Social Commerce
While the future of TikTok in the U.S. is still uncertain, the impact of social channels overall on retail sales continues to explode, and that’s not expected to stop. This can be a lucrative opportunity for retail brands, but I imagine there are also challenges with having to manage this influx of new channels and influencers.
How are brands keeping up and managing the influx of channels, while still maintaining a consistent brand presence? And as the rise of dupes threatens authenticity, is influencer culture helping or hurting brand perceptions?
Adam: The growth of social commerce, which is likely to continue even if the TikTok ban takes effect in 2025, presents a major challenge to brands seeking to maintain their image in the marketplace. Such platforms may not have the brand protection and anti-counterfeiting infrastructures of more established platforms such as Amazon, making the presence of dupes both more likely and harder to track down and take off the market. Influencers can amplify this problem by promoting products that may or may not be the genuine article.
Brands concerned about the dilution of their image may want to harness the power of key influencers, convincing them of the benefits of promoting their actual products rather than counterfeits. Consumer education is another potentially powerful tool, as is keeping a close eye on manufacturers to ensure they are not creating “extra” product to be sold on black or grey markets.
Reflections on Circular Commerce & the Environment
Over the past several years, we’ve seen more brands commit to sustainable packaging and logistics, circular commerce and other environmental efforts. Are retail brands continuing to prioritize sustainability efforts in 2025? Will we see this pick up or slow down in 2025?
Adam: The embrace of circular commerce is likely to continue growing in 2025, especially considering the number (and variety) of brands that initiated some kind of resale program in 2024 – including Patagonia, David’s Bridal, Béis, Fjällräven, Stitch Fix and Ikea – as well as the rise of resale-specific marketplaces such as StockX.
Brands, particularly those in the luxury space, are eager to extend the life of their products as well as making their products more affordable to an aspirational consumer, and trade-ins of “gently used” products and other resale opportunities give them a golden opportunity to accomplish both goals.
There does seem to be a softening of support among some retailers for sustainability as well as other DEI (diversity, equity and inclusion) programs, but I’m hopeful that this is just a blip in the move toward a more sustainable industry. Big companies including Starbucks and Amazon are making sustainability investments in their supply chains that are likely to have positive ripple effects for years to come.
Additionally, circular commerce programs provide low-friction ways for consumers to feel good about their personal sustainability profiles, which should encourage more participation.
Catch the Latest Retail Technology Trends with PAN
What trends are you expecting to dominate the show floor at NRF this year? Looking to hear more? Join PAN, Adam Blair, and the Retail TouchPoints team for an exclusive cocktail hour at KYMA on Monday evening of NRF to connect and mingle about what’s next in retail tech.
To secure your spot, visit: PAN & Retail TouchPoints Cocktail Hour at KYMA.
