In its 2024 report, Retail Reinvention: A Framework for Future Growth, Euromonitor International offers a strategic blueprint for retailers adapting to a fast-changing industry environment. This report, developed in partnership with the National Retail Federation (NRF), identifies significant shifts in consumer behaviour, digital adoption, and industry dynamics, which are redefining the traditional retail model. With e-commerce projected to drive 56% of global retail sales growth over the next five years, retailers face mounting pressure to adopt new technologies, expand distribution channels, and realign their business models to meet diverse consumer expectations.
One significant change is the growing adoption of new business models, including direct-to-consumer (DTC), marketplaces, and social commerce (s-commerce). These models have disrupted conventional retail, particularly with third-party marketplaces like Tmall and Amazon, which collectively grew ten times faster than the broader retail sector from 2018 to 2023. In the U.S., DTC accounted for 17% of e-commerce sales last year, a figure that is expected to rise as brands look to engage consumers directly while gaining deeper insights into their preferences.
The report also highlights the importance of revenue diversification as retail expands beyond simple product sales. Over 43% of industry professionals reported exploring alternative revenue streams, including value-added services like health and financial products, retail media networks, and subscription-based ecosystems. For example, retail giants such as Walmart and Kroger have successfully implemented media networks and membership programs that increase customer loyalty and enhance the shopping experience. These services drive significant profits and customer engagement, providing an edge in a highly competitive market.
Retail’s expansion into omnichannel strategies is another core theme of the report, which underscores the need for a seamless customer experience across physical and digital channels. As retailers integrate online stores, mobile apps, and social media with in-store offerings, they create frictionless shopping experiences that can improve customer retention and satisfaction. However, channel integration remains a challenge, with budget limitations, system incompatibility, and internal resources cited as significant obstacles by 40% of industry respondents. Euromonitor’s findings highlight the value of omnichannel approaches in driving consumer loyalty, with research showing that shoppers who buy both online and in-store tend to spend more and visit more frequently.
Consumer expectations have also shifted dramatically. Today’s shoppers demand personalised experiences, transparency, and alignment with their values. The report notes that half of global consumers prefer tailored products and services, particularly those classified as "connected shoppers" who are highly digitally engaged. These consumers prioritise sustainability, quality, and authenticity, and they increasingly support brands that reflect their own social and political values. In fact, 30% of consumers globally are willing to pay more for brands aligned with their beliefs, while one in four is prepared to boycott those that don’t. For brands, this underscores the importance of aligning business practices with consumer expectations for greater brand loyalty.
The Retail Reinvention Framework developed by Euromonitor categorises 12 core tensions shaping the industry, such as "Price vs. Values" and "Personalization vs. Privacy." These frameworks help retailers evaluate and balance their approaches across three pillars: shoppers, industry, and digitalization. The framework also encourages businesses to identify specific tensions impacting their strategies, offering a structured path for managing future shifts. By applying this framework, brands and retailers can anticipate challenges, target growth areas, and refine strategies to stay competitive.
With digitalization and customer expectations driving major shifts, the retail industry is on the verge of a transformative period. Euromonitor’s framework not only provides a guide for future growth but also highlights opportunities for retailers to innovate, personalise, and redefine consumer relationships in a complex, digital-first market. This roadmap highlights the potential for sustainable and adaptive growth, underscoring the value of a proactive approach to industry evolution.
