What: Major US retailers are reshaping strategies, with Amazon abandoning stores, Walmart excelling in omnichannel, Dollar Stores thriving, and Target and Costco battling for market share.

Why it is important: The evolution of these retail giants underscores the importance of operational excellence, value-driven formats, and clear market positioning, reflecting trends from the past year.

The US retail landscape in 2026 is defined by decisive strategic shifts among its largest players. Amazon’s decision to exit most physical retail formats, including the closure of its Fresh stores, marks a clear pivot toward a delivery-centric model and signals the end of its brick-and-mortar ambitions. In contrast, Walmart has solidified its leadership in omnichannel retail, leveraging its extensive store network, technological investments, and a seamless leadership transition to maintain profitability and growth. Dollar General and Dollar Tree have emerged as the new powerhouses, attracting higher-income consumers and outperforming the market as inflation drives the middle class toward discount formats. Meanwhile, Target faces challenges in market positioning, struggling to balance its premium and discount appeal, while Costco continues to thrive with its membership-based “treasure hunt” model and strong brand loyalty. These developments reflect a broader industry trend: operational excellence, value-driven propositions, and clear differentiation are now critical for success as consumer behaviours and economic pressures reshape the sector.

IADS Notes: Amazon’s evolving approach to physical retail, including the closure of Fresh stores in the UK and the conversion of mall properties into distribution centres, underscores the company’s ongoing struggle to integrate digital-native strategies with traditional retail, as seen in Retail Week (September 2025) and PYMNTS (February 2025). Meanwhile, Walmart’s seamless leadership transition and tech-driven transformation, marked by significant investments in AI, automation, and omnichannel strategies, have enabled it to maintain operational excellence and market dominance, as documented in WWD (September 2025), Financial Times (November 2025 and February 2025), and The Economist (May 2025). The remarkable rise of dollar stores, particularly Dollar General and Dollar Tree, reflects a structural shift in consumer behaviour, with higher-income shoppers increasingly seeking value amid persistent inflation, as highlighted in the Financial Times (December 2025). The rivalry between Target and Costco further illustrates the importance of clear market positioning and the power of membership models, with Costco’s expansion and operational focus serving as a benchmark for the sector, as reported in Supermarket News (February 2025), The Economist (May 2025), and Bloomberg (December 2025). Finally, the impact of inflation and changing consumer priorities is evident in the outperformance of value-driven formats and the need for retailers to adapt pricing and supply chain strategies, as shown in Financial Times (December 2025), Forbes (September 2025), and Placer.ai (December 2025).

American retail: what will 2026 look like?