What: Capri Holdings' vice president of global analytics has transformed the company's data culture through a comprehensive consumer feedback system that predicts sales performance and shapes creative decisions.

Why it is important: The transformation reflects a crucial evolution in luxury retail, where consumer insights directly influence product development and marketing, potentially reducing the risk of unsuccessful launches and improving inventory efficiency.

Capri Holdings has revolutionised its approach to luxury retail by establishing an extensive consumer research programme encompassing 75,000 global participants. Under the leadership of Manuel Neto, vice president of global analytics, the company has developed a sophisticated system that surveys three distinct customer segments: existing purchasers, potential customers, and those planning future purchases. This innovative approach enables the company to test campaigns before launch, gathering vital feedback on brand heat and affinity. The research lab's influence extends beyond marketing, informing inventory management and regional distribution strategies. Initially met with resistance during budget planning, the programme now shapes nearly every aspect of the brands' output, from campaign shoots to influencer collaborations. The integration of data analytics with creative processes has required careful cultural transformation, with Neto developing specialised approaches to communicate with different teams. The success of this strategy is validated by the correlation between consumer intent data and actual transaction outcomes, demonstrating the effectiveness of this data-driven approach to luxury retail.

IADS Notes: Capri Holdings' innovative consumer research strategy aligns with broader industry transformations observed throughout 2024-2025. As seen in March 2025, when Michael Kors launched its Amazon storefront, luxury retailers are increasingly embracing data-driven decision-making to enhance digital distribution. This trend parallels the January 2025 Bain-Altagamma findings emphasising the need for stronger customer connections in luxury retail. The success of such approaches is evident in Mytheresa's December 2024 acquisition of YNAP, which demonstrated how data-driven operations can transform luxury retail. The integration of digital tools and physical experiences, as highlighted in October 2024, has become crucial for customer engagement, while Saks Fifth Avenue's July 2024 expansion of its personalised shopping services underscores the industry's shift towards data-informed experiential retail.

How Capri Holdings uses a 75,000-strong consumer ‘lab’ to shape luxury retail

What: India's luxury market undergoes fundamental transformation as 43% of luxury consumers emerge from non-metro cities, driving brands to adopt integrated physical-digital approaches while emphasizing pre-owned goods and cultural authenticity.

Why it is important: This shift represents a pivotal moment in global luxury retail, as India's projected $2 trillion retail market by 2033 and growing affluent consumer base of 100 million by 2027 create unprecedented opportunities for brands willing to adapt their strategies.

India's luxury retail landscape is experiencing a significant transformation, with 43% of luxury consumers now residing outside traditional metro cities. This shift is driving major brands like Bvlgari to adopt innovative "phygital" approaches, combining online presence through platforms like Tata Cliq Luxe with strategic physical retail in emerging markets. The pre-owned luxury segment presents another significant opportunity, particularly in watches and handbags, where cities like Ajmer and Bhubaneswar show strong demand. Cultural storytelling emerges as a crucial factor, with successful examples including Bvlgari's mangalsutra and Dior's partnership with the Chanakya School of Craft. The report emphasizes the importance of authentic cultural integration, as demonstrated by collaborations featuring Indian celebrities like Priyanka Chopra and Ayushmann Khurrana, and the success of initiatives that blend Indian traditions with global luxury.

IADS Notes: The transformation of India's luxury market is supported by significant developments throughout 2024-25. February 2025 saw 27 new international brands enter India, while Bulgari's expansion to nine key cities demonstrated the viability of integrated retail approaches. Barclays projects 15-25% annual growth through 2030, supported by an affluent consumer base expected to reach 100 million by 2027. The importance of cultural integration is highlighted by India's ranking as the most attractive emerging market, while the projected $89 billion in global retail spending by Indian tourists suggests the growing influence of Indian consumers in global luxury retail.

3 opportunities for brands eyeing India’s luxury market

What: BCG's annual survey reveals growing disconnect between UK business leaders' company-specific optimism and broader economic concerns for 2025.

Why it is important: This divergence in sentiment could impact pricing strategies and consumer spending patterns, particularly as 75% of businesses plan price increases.

The BCG survey reveals 83% of business leaders expressing confidence in their own prospects despite growing concerns about the broader economy. Companies demonstrate resilience through maintained employment plans and increased technology investment, while facing challenges from rising costs and tax pressures. The survey indicates 75% of businesses plan price increases, though at a lower rate than previous years, with 41% focusing on cutting non-essential costs. Only 13% plan to halt investment, and there's increased interest in technology adoption. This measured approach reflects a pragmatic response to market challenges while maintaining growth initiatives. The findings suggest businesses are adapting their strategies to navigate economic uncertainties while preserving operational momentum.

IADS Notes: Recent market analyses from January 2025 show global economic growth projections of 2.8% , providing context for UK business sentiment. This aligns with trends seen in the retail property sector, where Hammerson reported a 4.2% increase in UK mall values  in March 2025, suggesting underlying market strength despite challenges. However, February 2025 data indicates declining consumer confidence , creating a complex operating environment for retailers balancing growth ambitions with market realities.

State of UK business 2025: confidence at a crossroads

What: Southeast Asia's economic performance in Q4 2024 shows regional stability amid external challenges, with Vietnam leading at 7.55% growth while maintaining robust retail and tourism sectors.

Why it is important: The varied performance across markets highlights opportunities for retail expansion, with Vietnam's retail market projected to reach USD 350 billion by 2025 and Thailand emerging as a luxury retail powerhouse.

Southeast Asian economies demonstrated remarkable resilience in the fourth quarter of 2024, with most countries achieving growth rates of 5% or higher. Vietnam led the region with an impressive 7.55% expansion, while Thailand's growth accelerated to 3.2%. The region's core growth drivers remained steady, with particularly strong investment flows and stable consumption patterns. Private consumption showed resilience across most markets, supported by improving labour markets and moderating inflation. The retail sector's transformation was evident through significant developments, including major infrastructure projects and digital integration initiatives. Tourism recovery played a crucial role in driving growth, especially in Thailand and Singapore, where retail sales showed strong correlation with visitor arrivals. Despite these positive indicators, regional currencies faced pressure against the US dollar, prompting several central banks to implement strategic rate adjustments to maintain economic stability.

IADS Notes: Recent developments underscore Southeast Asia's retail transformation. In February 2024, Central Retail announced a USD 665 million investment in AI integration and ecosystem development, while November 2024 saw MM Mega Market commit USD 20 million to Vietnam's expanding market. Thailand's emergence as a luxury retail hub was evidenced by the USD 3.2 billion One Bangkok project in October 2024, while Singapore's January 2025 retail performance showed strong digital integration with online sales reaching 13.3% of total revenue. These investments reflect growing confidence in the region's retail potential, despite varying market conditions.

Southeast Asia quarterly economic review: Steady amid uncertainty

What: Trump administration's 25% tariff implementation signals major disruption to North American retail supply chains and pricing structures.

Why it is important: This policy shift represents the largest coordinated tariff action affecting retail supply chains in recent history.

The implementation of 25% tariffs on Mexican and Canadian imports marks a significant shift in retail economics, with projected annual costs of USD 1,200 per US household. The National Retail Federation's analysis suggesting a USD 46-78 billion reduction in consumer spending power highlights the broad economic implications. Different retail sectors face varying impacts, with food & beverage and general merchandise expected to see price increases of 0.81% to 1.63%. The tariffs are particularly significant for cross-border retail dynamics, affecting common imports ranging from food products to manufactured goods. Consumer behavior is already shifting, as evidenced by Canadian consumers' response to strip American alcohol brands from shelves. This development, combined with existing inflation concerns, suggests a fundamental restructuring of retail pricing strategies and supply chains across North America.

IADS Notes: Recent data from March 2025 shows 62% of consumers expressing concern about rising retail prices due to new trade policies. This anxiety is supported by BCG's January 2025 analysis projecting USD 640 billion in additional import costs from expanded tariffs. The impact is already visible in specific sectors, as demonstrated by Mexico's December 2024 implementation of 35% textile import tariffs. February 2025 saw consumer confidence recording its sharpest decline since August 2021, while April 2024's changes to de minimis thresholds highlighted the broader transformation in international trade regulations affecting retail operations.

How tariffs will impact retail prices

What: A large-scale study of 776 Procter & Gamble professionals reveals that AI-enabled teams outperform traditional work groups, with individuals using AI matching the performance of two-person teams while reducing work time by 12-16%.

Why it is important: These findings provide a concrete blueprint for retailers seeking to optimise their workforce, as the industry grapples with implementing AI solutions that have already shown 15-30% efficiency improvements in customer service operations.

The comprehensive study of P&G professionals demonstrates AI's transformative impact on team dynamics and productivity in knowledge work. The research reveals that individuals working with AI can match the performance of traditional two-person teams, while AI-enabled teams achieve the highest overall performance, particularly in producing exceptional solutions ranking in the top 10% of quality. The study also shows that AI effectively bridges professional silos, enabling both technical and commercial specialists to produce balanced solutions regardless of their background. Notably, less experienced employees working with AI performed comparably to experienced teams, suggesting AI's potential to democratise expertise. The emotional impact was equally significant, with AI users reporting higher levels of positive emotions and lower levels of anxiety and frustration. These findings, based on real-world product development tasks with actual business stakes, provide valuable insights into how AI can enhance both individual and team performance while improving the overall work experience.

IADS Notes: The study's findings align with significant retail industry developments throughout 2024-2025. As reported in February 2025, 87% of retailers implementing AI witnessed revenue increases of 6% or more, while customer service operations showed 15-30% efficiency improvements. The democratisation of expertise was particularly evident in retail applications, with AI-tool-directed traffic increasing 304% year-over-year. However, implementation challenges persist, as only 10% of companies successfully scale their AI applications, though those who do report 50% reduction in administrative tasks and 30% faster development with properly supervised systems.

The Cybernetic Teammate

What: AI-driven hyper-personalisation is transforming retail through advanced data analytics and machine learning, with the global market projected to grow at 23% annually as retailers leverage technology to enhance customer experiences and operational efficiency.

Why it is important: As consumer expectations evolve and technology becomes more accessible, retailers must embrace AI-driven personalisation to remain competitive, with industry leaders already demonstrating how this transformation can drive substantial revenue growth and operational efficiency.

The retail industry is witnessing a revolutionary transformation through AI-driven hyper-personalisation, with the global market for AI in retail valued at USD 11.61 billion in 2024 and projected to grow at 23% annually through 2030. This evolution is driven by strong consumer demand, with 67% of customers seeking more personalized interactions and real-time recommendations. Retailers are leveraging AI technologies to enable precision targeting, optimise content delivery, and create seamless omnichannel experiences. Key elements include enhanced data collection through loyalty schemes, AI-powered customer data platforms, and sophisticated machine learning algorithms that enable microtargeting and real-time engagement optimisation. The integration of physical and digital dimensions through augmented reality and virtual reality further enhances the customer experience, while agentic AI and generative AI enable more sophisticated customer interactions through chatbots and voice assistants. Success stories from major retailers demonstrate significant improvements in conversion rates and revenue growth, highlighting the transformative potential of these technologies.

IADS Notes: The retail industry's embrace of AI-driven hyper-personalisation has reached a critical inflection point, as evidenced by recent market developments. McKinsey's February 2025 report highlighting that 71% of consumers expect personalised interactions underscores the urgency of this transformation. This consumer demand aligns with BCG's November 2024 analysis revealing potential gains of USD 570 billion for industry leaders through personalisation. The operational impact is equally significant, with AI agents demonstrating 15-30% improvement in customer service efficiency as of January 2025. Walmart's successful implementation of AI-powered personalised homepages in October 2024 serves as a blueprint for large-scale deployment, showing how retailers can effectively combine data analytics, machine learning, and customer experience optimisation. These developments collectively demonstrate how AI-driven personalisation is evolving from a competitive advantage to an essential component of retail strategy.

How AI-driven hyper-personalisation is transforming retail

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Annual Department store results

The IADS Global Department Store Monitor was originally launched in May 2021 by Dr. Christopher Knee as the ‘IADS 100 Report’ after realising that comparable department store data was either unavailable, poorly understood, or not exploited by analysts. This was characteristic of an ever-evolving industry, making it difficult for outsiders to understand, including events such as privatisation, mergers, change in ownership, or simply not categorising numbers by business uniti.

Since then, the report has been renamed and rebuilt into a new format to enable dynamic comparison among department stores over a specific period and a series of years. To track and compare sales and profits from companies worldwide while accounting for fluctuations in exchange rates, the renewed version of the monitor includes current (as of today) and fixed exchange rates (as of 2021) to isolate the impact of sales growth from the effect of exchange rate changes.

Also, given that accounting standards across countries are not uniform, the fiscal year is referred to as FY 2023-2024 throughout the monitor to compare results across the occurrence of the same world events. This uniformity helps maintain a baseline in the events that have occurred throughout the year to draw fair conclusions. The conception of this monitor was driven by the need to juxtapose pre- and post-COVID-19 results. The 2025 edition of the IADS Global Department Store Monitor reviews 59 department stores with publicly available information to create a benchmark for global department store stakeholders regarding the 2023-2024 period.

This report attempts to capture the global economic retail scenario post-COVID-19 and whether pre-COVID-19 numbers have been regained or are faltering.

Fiscal Year 2023-2024 : Slow and steady resilience

The global outlook during this period was characterised by uncertainty amid turmoil in the financial sector, high inflation, the impact of Russia’s invasion of Ukraine (which started in February 2022) and marking three years of the COVID pandemic, which was finally declared over as a health emergency in May 2023. Recovery was slow but steady due to widening divergences among economic sectors and regions. 2024 also saw a changing political landscape with over 70 elections globally. However, despite fears of a hard economic landing, the global economy was surprisingly resilient despite significant central bank interest rate hikes. Inflation also began to decline across emerging and advanced economies.

During FY 2023-2024, major retail industry transformations were afoot:

• From a regional perspective, US department stores saw their market share decline, dropping from 14% in 1993 to less than 3% in June 2024. This prompted strategic consolidations such as Saks Fifth Avenue’s USD 3 billion offer for Neiman Marcus Group that was turned down (eventually closing the deal at USD 2.7 billion in December 2024). Macy’s received a USD 5.8 billion offer from private equity firms Arkhouse and Brigade Capital Management however ended takeover talks in July 2024. The department store also announced its plan to shutter 150 stores while shifting its focus to attracting younger customers in February 2024.
• In Asia, India solidified its position as a growing luxury market with an expansion of around 3.4% in 2023 and attracted 27 new international retail brands in 2024. Not just domestically, Indian brands such as SABYASACHI arrived at Bergdorf Goodman in November 2024. On the other hand, China faced a retail slowdown commencing in July 2024 due to economic challenges such as rising local government debt and reduced private-sector spending. Hong Kong saw a similar decline in the second half of 2024 due to the shift in consumer behaviour among mainland Chinese visitors. In Japan, Seven & i Holdings completed the sale of Sogo & Seibu department stores to Fortress Investment Group in October 2023.
• The retail industry is undergoing a transformation due to AI-driven hyper-personalisation, with the global market for AI in retail valued at USD 11.61 billion in 2024 and projected to grow at 23% annually through 2030.
• Department stores advanced their sustainability commitments against growing regulatory demands. Harrods published its first-ever ESG report in June 2024 highlighting its progress in the reduction on Scope 1 and 2 carbon emissions and setting future goals.

Fiscal Year 2023-2024 financial results: The post-Covid boom in retail is tapering off

In 2024, the global economy, including the retail sector, faced significant market uncertainty, slow economic growth, and unfavourable interest rate environments across regions.  The post-COVID-19 peak of 2021 and 2022 has passed, and growth has now stabilised across the retail sector, with department stores largely following this trend, albeit with regional divergences. Some broad observations from the Global Department Store Monitor for FY 2023-2024 covering 59 department store companies indicate that:

• The average global year-on-year sales growth in FY 2023-2024, after two years of significantly positive sales growth in 2021 and 2022, shows a slightly negative sales trend of around –1.6%.
• The share of department store sales in total retail sales is stabilising and has almost returned to pre-COVID levels.
• This is also due to the reduction of total global retail sales after hitting a peak in 2021 and 2022. Global retail consumption is starting to slow down due to considerations such as reduced purchasing power, slowdown in the luxury sector, environmental responsibility considerations and other factors that differ regionally.

In the Americas, department store sales have stabilised and are contributing more to their owners’ retail sales than pre-COVID. This is due to increased department store sales and lower total retail sales per company. The average sales trend for these group-owned department stores is negative compared to 2021 and 2022, suggesting that the post-Covid peak has passediii. On the other hand, stand-alone department stores are almost stable and slightly positive in year-on-year sales growth.

In the Asia-Pacific region, department store sales have stabilised but have not yet reached pre-Covid levels regarding contribution to their owners’ total retail sales. Department store sales have reduced due to a global retail slowdown, especially in Japan, South Korea and Hong Kong. The average sales trend for department stores was negative, after two consistent years of sales growth in 2021 and 2022. In India and the Philippines, on the other hand, department stores saw a positive sales trend.

Similarly, in Europe, sales in group-owned department stores have risen and crossed the pre-COVID contribution to their owners’ total retail sales. European department store performance has been decent on average. However, total retail sales have reduced. Both, department stores owned by groups and standalone department stores saw a muted positive sales trend of less than 1% on average.

Americas: Marked by restructuring and innovation

In Chile, Falabella (-10.7%) saw a negative sales trend but increased its profit. Falabella’s increase in profit may be explained by its sale of two major assets during the financial year. It also invested over USD 100 million into enhancing its omnichannel capabilities, store network expansion, and sustainability efforts. Cencosud Paris (+6.6%) saw an upward sales trend but declining profit. Cencosud Paris undertook several store transformations and launched its digital wallet CencoPay. Ripley (-7.1%) saw a declining sales trend and increased its losses. It introduced cafés and beauty salons in its flagship Lima stores following its strategic decision to reinvent itself as a lifestyle destination.

Mexican department store El Palacio de Hierro (+10.6%) increased its sales and profits during this fiscal year. It recently revamped two stores and relaunched one in Mexico City. Similarly, Liverpool (+23.2%) also saw rises in its profits and sales. Post-pandemic consumer sentiment in Mexico has tended towards value for money and convenience. Liverpool acquired Nordstrom in the US and established a significant North American-Mexican retail alliance.

In the US, Nordstrom (-5.7%) and Macy’s (-5.5%) saw a decline in sales and reduction in profit, although it stayed positive. Nordstrom was privatised by family ownership and Mexican retailer Liverpool. Macy’s announced that it would close 150 stores and focus on expanding Bloomingdale’s and Bluemercury operations. It also faced pressure from investors to create a real estate subsidiary for better asset management citing Dillard’s successful operating model. Similarly, Dillard’s (-1.73%) and Kohl’s (-3.35%) saw fewer sharp sales downturns but while Dillard’s saw a slight dip in its profit, Kohl’s plunged much further into loss. Dillard’s was the best performing department store among its competitors; it achieved superior results through focused operations and disciplined capital management. Kohl’s undertook leadership changes and tightened its budget to cope with its results. All major US department stores went through a tough financial year prompting mergers such as Saks- Neiman Marcus which was finalised in December 2024 and privatisations such as Nordstrom.

Asia-Pacific: Diverging results across South, East and South-east Asia

The 2023 sales trend in China has been fairly stable. Parkson Retail Group Ltd (+9.9%), Wangfujing (+13.2%) and Wushang (+13.2%) reported positive sales growth. Several Chinese department stores included in the Global Department Store Monitor showed stable sales numbers with negligible deviation. New World (-34.4%) and Maoye (-5.1%) reported negative sales trends; while the former’s negative sales growth mounted, the latter was able to reduce its negative sales growth from the previous financial year significantly. In FY 2023-2024, the Chinese economy was characterised by real estate crises, high youth unemployment rates, and a generally cautious consumer sentiment. With moderate expansion, China saw the emergence of new trends; rural areas outperformed urban areas regarding consumption. The luxury sector showed a decline of 18-20% overall but rural consumers showed more propensity for luxury consumption while their urban counterparts exhibited luxury fatigue. Government stimulus measures and local economic conditions also influenced rural customers. Aspirational urban consumers that once fuelled luxury growth preferred products and services that enhance their quality of life like travel and health.

In Hong Kong, Wing On showed modest sales growth of almost 1.5% but was able to achieve a good pre-tax profit after marked losses in the previous year. Sogo was privatised mid-2022 and has not released public financial statements sinceiv. Hong Kong saw a shift in consumer behaviour from mainland Chinese consumers. Inbound tourism has not recovered as quickly as expected and tourist expenditure saw a drastic fall compared to 2018 levels. The Hong Kong Dollar was strong which encouraged locals to shop abroad, adding to the decline of retail sales in Hong Kong. Given this perspective of the Hong Kong retail scene, department stores have been remaining afloat.

Indian department stores, Lifestyle and Shopper’s Stop have been performing well. While the 2023 sales numbers for Lifestyle are not available yet, it has been consistently growing sales since the COVID-19 pandemic and announced plans to open at least 50 new stores in the next three to four years. Shopper’s Stop reported a positive sales trend of 5.4% after two consistent years of double-digit sales growth. Despite Amazon divesting its stake in Shopper’s Stop, the department store saw a growth in sales driven by beauty. The Indian retail market is booming with several foreign brands entering the country during the year. In Sri Lanka, Odel (-11.5%) saw a continuing downtrend in sales and almost doubled its losses. The country saw a sluggish economy ridden with inflation and political instability. The consumer expectation of digitisation and personalisation is strong and sales at Odel have consistently declined with its owner, Softlogic Group, seeking investors for the retail store.

Japan has seen a strong pattern of recovery post-COVID, with all department stores finally achieving the green in this financial year. Tobu (+3.45%), Kintetsu (+4.39%), Takashimaya (+5.1%), Marui (or 0101) (+7.97%), and H2O (Hankyu Hanshin) (+9.6%) showed growth with Tokyu (+11.44%), J Front (Daimaru Matsuzakaya) (+15.3%) and Isetan Mitsukoshi (+17.54%) reaching double digit sales growth. Isetan Mitsukoshi especially has shown steady recovery since experiencing a significant operating loss in Financial Year 2020-2021 due to the impact of Covid-19, with particularly strong performance in Financial Year 2023-2024 which represented the highest operating income since the merger of Isetan and Mitsukoshi in 2008. All reported department stores had positive profits surpassing 2022 levels. In Japan, department stores saw their growth rate decline dramatically from 10.8% in the first half of 2024 to just 2.3% in the second half. However, stores in tourist areas outperformed other stores by a large margin. Japan's luxury market experienced a significant sales spike driven by international tourists capitalising on a weak yen and resilient domestic spending. The weakened domestic currency overinflates Japan’s retail performance and is likely economically unsustainable.

Korea has seen an overall decrease in sales growth, with the most severe decreases being in Lotte (-5.9%), Shinsegae (-12.8%), and Hyundai (-16%), while Hanwha Galleria (+0.5%) was the only department store to remain stable. The spinoff of Galleria can explain this as a separate entity starting in 2023. Following this trend, there have been slight decreases in operating profit figures. During the fiscal year, the South Korean economy saw a downturn marked by high interest rates and rising prices. While department stores posted growth in the previous fiscal year, they could not maintain it in the rough economy during FY 2023-2024.

Interestingly, the pre-owned luxury market performed well and much better than the declining luxury sector in both South Korea and Japan. Even before the depreciation of the Japanese yen in the first half of 2024, Japan’s secondhand market saw strong growth driven by TikTok where secondhand shopping in Japan has become a trend. In 2023, South Koreans were the world’s largest online shoppers in resale with almost 62% shopping for secondhand luxury goods.

In the Philippines, SM (+6.8%) showed a positive sales and profit trend. Robinson’s Retail (+7%) showed a positive trend for sales but reduced profit, though the latter remained positive. The FY 2023-2024 growth was attributed to store expansion initiatives and recovery from pandemic restrictions. Robinson’s Retail’s department store segment grew at more than its combined retail operations at 8%. It was driven by improved category performance in travel-related items, sportswear and improved gross margins from a better category mix. The retail industry in the Philippines has seen steady growth, driven by rising consumer spending and a youthful population. The focus of Philippine retailers has now turned to expanding omnichannel integration.

In Malaysia and Singapore, Parkson Retail Asia faced concerns regarding operating as a going concern. Its subsidiary for Vietnam operations filed for voluntary bankruptcy later in April 2023. The Singaporean economy saw declining growth in the retail sector. This was also driven, in large part, by tourists opting to shop in cities that provide cheaper alternatives. Though Malaysia posted decent growth in the retail sector, this did not translate into better performance for department stores.

In Indonesia, Matahari (+1%) saw a small positive sales trend combined with a massive jump in profit. Overall, Indonesia’s retail sector has perfomed well.

Central Retail in Thailand saw modest sales growth of 5% and a slight increase in profit. The country also experienced strong economic growth and an uptick in luxury sales.

Australian department store David Jones was sold by Woolworth’s in March 2023 hence no results are available for the last fiscal year. David Jones saw a significant decline in sales after its sale to Anchorage Capital Partners. However, reinvestment was planned for both in-store and online shopping experiences. Myer (-2.9%) saw a slightly negative sales and profit trend. It purchased Apparel Brands in October 2024 to expand its loyalty programme, Myer One. Both Australian department stores are reducing their number of stores overall; while David Jones is reducing the size of its physical stores, Myer is reducing its locations while focusing on a younger consumer.

Europe: Decent performance across countries

The UK saw mixed results with rising profits and reducing losses being the broad trend. However, Selfridges (according to press sources) and Fenwick (-14%) saw deepening losses attributed to high inflation, increased competition, and a challenging retail environment. Selfridges saw notable property devaluation, changes in ownership stakes, and impending loan repayment. This decline in valuation was attributed to external market factors including rising interest rates and rents. Fenwick closed its flagship and sold it to developers, reflecting its sales decline. Harvey Nichols decreased its losses but remains in the red. On the contrary, John Lewis (+1.4%), Liberty (+6.6%), Harrods (+8%), Fortnum & Mason (+9.1%) Marks & Spencer (+9.6%), all showed positive sales trends and an increase in profit. John Lewis reduced its losses and increased its profit. This was attributed to the effectiveness of strategic initiatives such as relaunching the ‘Never Knowingly Undersold’ promise and joint loyalty programme with Waitrose that showcased its resilience and market adaptability. Liberty saw success across product categories and subscription services despite a decline in e-commerce revenue. Harrods was sued by the victims of alleged sexual abuse by its previous owner but managed to post a notable sales growth and profit despite this bad publicity. At Fortnum & Mason, sales recovered, and turnover returned to pre-COVID levels. This was primarily driven by international customers supported by opening a new store at the Hong Kong airport. It was also reported to have been considering entering the US market. Marks & Spencer saw a big rise in profit supported by a substantial investment in enhancing staff compensation and family leave policies. It saw private label success including its own beauty brand. The UK saw an unexpected upswing in department store and non-food store sales during the year's second half. Despite the calculated loss of over GBP 10 billion due to the removal of tax-free shopping for tourists in 2021, UK department stores managed to grow their sales.

In Denmark, Illum (+10.5%) and Magasin du Nord (+0.5%) reported positive sales trends; Illum lessened its loss while Magasin du Nord saw a slight decrease in its profit. Denmark saw positive consumer sentiment but a reduction in net spending for all categories except groceries.

In Finland, Stockmann (-3%) saw a negative sales trend but a rise in its operating profit. Due to its struggling financials, Stockmann in Helsinki considered a potential name change to that of parent company Lindex and the sale of the department store.

In Sweden, Ahlen’s (-19.5%) saw a downtrend after consecutive years of growth after the pandemic. After its ownership change in 2022, it has not broken out its profit for department stores. Sweden saw higher prices due to inflation, with consumers transitioning to lower-cost goods and actively reducing consumption for environmental reasons. NK (+4.2%) saw a positive sales trend, but it reduced its profit during the 2023 financial year.

The Norwegian retail market showed signs of expanding with potentially becoming a new luxury destination driven by currency devaluation, tax-free shopping and disincentivising luxury imports, as well as an uptick in tourism during warmer months. According to press sources, Steen & Strøm in Oslo witnessed sales growth of 14% in the first half of 2024v.

Kaubamaja (+9.8%) in Estonia saw a significantly positive sales trend and rise in profit. However, Estonia saw a 1% reduction in total retail trade volume, comprising a 3% drop in textile, clothing, and footwear store sales.

In France, while Galeries Lafayette does not release its financial results, according to press sources, the company returned to its pre-COVID sales volume of EUR 3.85 billion by the end of 2024 and is currently implementing its EUR 400 million investment plan over the next five years. Similarly, Printemps does not share revenue or profit figures but confirmed in the press that it entered 2023 profitablyvi.

In Greece, Attica (+18.8 %) saw an upward sales trend and an increase in its profit. Although it was fined EUR 400,000 for misleading pricing practices, it was still able to grow financially. In general, the rent for retail spaces in Greece followed an upward trend.

El Corte Inglés (+2.6%) in Spain saw a positive sales trend and a drastic rise in its operating profit. Spain saw robust growth in consumer spending reflected in department store sales.

In Switzerland, Jelmoli (-4.2%) saw a negative sales trend and improved its EBIT while remaining in the red. Coop (+1.34%) saw a positive sales trend and an increased profit figure. In Switzerland, luxury department stores such as Jelmoli and Globus faced declines due to a shift in the retail landscape. Jelmoli’s flagship store in Zurich is now closed waiting for Manor to takeover.

Middle East and Africa: Operating in a complex environment

In South Africa, Woolworth’s (-16%) showed a significant drop in sales and profit explained partly by the closure of over 30 stores. Woolworth’s sold David Jones to Anchorage effective in March 2023. The South African economy saw an increasingly complex environment due to load shedding, inflation, and global supply chain disruptions. The South African Reserve Bank raised interest rates multiple times to combat persistently high inflation of almost 6% as of August 2024. The national power crisis required retailers to undertake substantial costs for alternative energy sources like generators and battery systems.

What to expect from Fiscal Year 2024-2025 and beyond

Retailers are presently gathering the results for the current FY 2024-2025. However, clear global challenges throughout the year will undoubtedly impact their results:

• the election of President Donald Trump in the US and impending tariffs, some of which have already been enforced, across the globe are sure to restructure global retail supply chains. Though inflation across other economies has been decreasing, the US market fears stagflation – a combination of high inflation and slow growth - despite Trump’s pro-domestic growth agenda. The ripples of US American economic actions will no doubt be felt worldwide, with the EU, China and Canada, among other countries, discussing retaliatory tariffs. Canadian department store Hudson’s Bay has already applied for creditor protection given a weak recovery post-COVID and tensions with the US. India, conversely, is preparing a tariff reduction proposal with the US.
• The potential US TikTok ban pending its sale to a US owner adds to the uncertainty, given that it is an essential social media channel that drives trends and influences consumer behaviour in the fashion industry. Furthermore, the rise of TikTok Shop, which emerged as the second-largest e-retailer behind Amazon during UK's Black Week, represents its influence over the fashion and retail sectors. Already available in the US, the UK and Spain, it is poised for entry in other European markets later this year. The global economic forecast of 2025 is hence dodgy and will digress from 2024 results sharply.

In Asia, Vietnam’s total retail sales are projected to reach USD 350 billion this year and with a young, expanding middle class with rising purchasing power, Vietnam is rapidly becoming a key player in Asia’s retail landscape. Luxury retailers such as Tiffany & Co and Montblanc have opened their first flagship stores in Hanoi and Ho Chi Minh City. The Indian market will continue to grow with Galeries Lafayette’s first Indian department store set to launch this year in Mumbai and a second one in Delhi in 2026 in partnership with Aditya Birla Group.

In the EU, revised sustainability directives CSRD (Corporate Sustainability Reporting Directives), CSDDD (Corporate Sustainability Due Diligence Directive), and ESPR (Ecodesign for Sustainable Products Regulation) mandate comprehensive environmental reporting and due diligence from retailers by 2028. Nordic countries such as Norway are seeing dramatic rise in tourist shopping due to tax-free benefits. Steen & Strøm doubled its tax-free shopping revenue in 2024. This is further supplemented by an increase in climate tourism where visitors flock to cooler countries due to climate change.

The next edition of the Global Department Store Monitor will examine the results from FY 2024-2025. While the global retail landscape is constantly changing, the factors discussed above will have a definite impact on department stores, adding to their current transformation, which includes prioritising omnichannel presence, experiential retail, and adapting to changing consumer preferences.

[i] And a reason for international analytic platforms such as the International Association of Department Stores to exist in the first place.

[ii] Companies’ accounting standards reflect both whole and broken fiscal years which is indicated in the monitor by marking it as Fiscal Year 2023-2024.

[iii] Note: here are only three Latin American department stores owned by groups that are analysed in this section due to the limited availability of public financial data, so inferences may not be fully extrapolatable.

[iv] Since results are not published, this department store is not included in the Global Department Store Monitor.

[v] However since results are not published, this department store is not included in the Global Department Store Monitor.

[vi] Ibid.

Credits: IADS (Anchita Ranka)

What: Erewhon has evolved from a health food store into a luxury lifestyle brand, leveraging celebrity partnerships and premium pricing to create a distinctive retail experience that transcends traditional grocery shopping.

Why it is important: The transformation demonstrates how specialty retailers can successfully elevate everyday shopping into luxury experiences, creating new benchmarks for experiential retail and community building in the process.

Erewhon's remarkable transformation under Tony and Josephine Antoci's leadership since 2011 exemplifies the evolution of modern retail into experiential destinations. The company has successfully positioned itself as a luxury lifestyle brand, where $20 smoothies and $19 strawberries become coveted status symbols rather than mere grocery items. Their strategic approach combines premium product curation with celebrity partnerships, including viral smoothie collaborations that generate both social media buzz and charitable contributions. The company's $200-a-year membership programme has created an exclusive community aspect, while partnerships with fashion brands like Balenciaga and lifestyle ventures such as Sushi Club have reinforced its luxury positioning. As Erewhon expands to thirteen locations across California, its success demonstrates how a focused retail concept can evolve into a comprehensive lifestyle brand that attracts both local regulars and international visitors seeking an authentic LA experience.

IADS Notes: Erewhon's success aligns with significant retail trends identified in recent years. As noted in January 2025, successful retailers are prioritising emotional engagement over traditional sales metrics, which Erewhon demonstrates through its carefully curated environments and social spaces. The company's approach to creating community hubs reflects the growing importance of "third spaces," where retailers foster genuine connections beyond traditional shopping experiences. Their December 2024 expansion into apparel and lifestyle products exemplifies how strong brand identity can support category expansion, creating a comprehensive lifestyle experience that transcends traditional retail boundaries.

The business of Erewhon

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The French department store Printemps is making a bold leap into the U.S. market by opening its first American outpost in Manhattan’s Financial District. After four years in the making, the 2-story, 4,000 square meter location at One Wall Street opened last 21st of March (on Spring Day, which means Printemps in French). Interestingly, it is not advertised as a store but as an immersive luxury experience, blending fashion, gastronomy, and hospitality.

With around one-tenth of the Paris Haussmann flagship store surface, Printemps aims to challenge the traditional department store model by focusing on experiential retail, offering visitors a space to linger, discover and indulge. Also, the opening of Printemps, a new retailer name for US consumers, is expected to contribute to the renewal of the Financial District, introducing a new luxury shopping option in NYC. Advertised as “not a department store” on local cabs and billboards, Printemps is a very ambitious project. What is it all about? Many retailers have bit the NYC dust in the past. What is Printemps’ plan to differentiate, in a crowded market, to oversollicited customers?

It starts with the real estate

One Wall Street: from New York landmark…

One Wall Street is an architectural and historical gem that has played a prominent role in New York City's skyline since its construction in the early 20th century. Originally built as the headquarters of the Irving Trust Company, the building was completed in 1931. At the time, it was one of the tallest buildings in the Financial District, standing at 199 meters and 50 stories tall. One Wall Street is most famous for its stunning Art Deco interiors, particularly the Red Room, a large reception hall embellished with over 2.5 million red and gold mosaics designed by artist Hildreth Meière. The space was initially conceived as a banking hall meant to impress clients and reinforce the prestige of the Irving Trust Company. A 35 story annex was added to the original building in 1965.

Over the decades, One Wall Street has changed hands several times, reflecting shifts in the financial industry. After serving as Irving Trust's headquarters, the building became home to the Bank of New York Mellon, following a series of banking mergers and acquisitions. In 2014, the building was acquired by Macklowe Properties for USD 585 million (and backed by Dilmon LLC, the family office of Qatar’s Sheikh Hamad bin Khalifa Al Thani) to embark on a massive redevelopment project to convert the office tower into a luxury residential and retail destination. Macklowe then secured a USD 750 million construction loan from Deutsche Bank in 2018 to fund the project.

… to a mixed-use destination with problems

Besides Printemps, One Wall Street offers local residents a 4,000-square-meter Whole Foods grocery store and a 5,000-square-meter Life Time wellness and fitness club. The project also boasts 9,000 square feet of resident amenities, including a private dining room and a pool.

Estimated to be a USD 1.5 billion project, the building repurpose is the largest office-to-residential conversion in NYC history. It also illustrates a significant shift in the Financial District as it transforms into a more family-friendly residential area, with ongoing office conversions, high-end retail, and cultural attraction openings, including the Perelman Performing Arts Center. On the corporate side, a new breed of companies have been settling down: tech companies, media companies such as Condé Nast and up-and-coming fashion labels like Theophilio, Rosie Assoulin and Bode. These changes will contribute to making the Financial District more lively and generating traffic.

However, as of November 2024, One Wall Street has faced significant challenges, with sales figures far from expectations. Out of 566 available units, only 113 had been sold since sales began in 2021 for USD 230 million, representing 14% of the anticipated USD 1.7 billion in sales. In 2022, developers were already looking for a USD 1.1 billion loan to help refinance the project. In 2023, in response to these slow sales, Macklowe secured a USD 300 million inventory loan from Deutsche Bank to manage the unsold units. Macklowe dumped two sales brokerages and now markets the units with his team.

One Wall Street is not the only project facing issues in the Financial District, as new residents are not flocking quickly. In addition to numerous rentals, the area has more than 220,000 condo units, with thousands unsold despite the median price dipping from USD 1.275 million in the second quarter of 2023 to USD 985,000 in the third quarter of 2024.

New York, New York: if I can make it there

From Galeries Lafayette and others…

New York has always been a retail magnet. Galeries Lafayette previously attempted to establish a presence in NYC. In 1991, they opened a store in Trump Tower on Fifth Avenue. After a promising debut, customers considered the store too French and complained that the supposedly exclusive brands were not. The targeted USD 65-70 million turnover could never be achieved, only reaching USD 24 million in sales in 1993. With high operating costs and stiff competition, losses peaked at 97 million in 1992 and 93 million in 1993. The store closed in November 1994. Other foreign retailers entered the U.S. and eventually shut down: Takashimaya, Topshop, Tesco, Carrefour and Joe Fresh.

… to Printemps

Luxury has never thrived in the Financial District in the past. Big names failed: Saks Fifth Avenue and Milan’s 10 Corso Como both left the area after less than five years, though Tiffany & Co. and Hermès opened stores on Wall Street in the past decade. Located close by, the Brookfield Place mall houses Gucci, Bottega Veneta, Louis Vuitton and Zegna. Also illustrating the area evolution, other high-street retailers are available close to One Wall Street: Zara, Anthropologie and Urban Outfitters.

Printemps didn’t disclose how much turnover the store is expected to generate, but CEO Jean-Marc Bellaiche says they have a “reasonable business plan.” Printemps bets on 150,000 people entering the store daily and targets local residents with a household income estimated at USD 170,000. Commuters and visitors from out of town are also targeted but should not account for the most significant chunk of customers. Echoing the new Selfridges’ loyalty programme, which rewards purchases and time spent using the store services and amenities (such as the skateboard room and the cinema, for example), Printemps says they will measure success in terms of the time customers spend in-store, not only in terms of sales per square foot. However, is this strategy relevant enough to generate the necessary volumes to make the store viable? They give the store two seasons to know if it’s a success or not.

When it comes to finances, Printemps has a special link with the building as the department store is owned by the Qatari-backed investment fund Divine Investments SA, which is supported by Dilmon LLC, a company financing the project along with Macklowe. As a result, it’s most likely that Printemps’s rent is very low or close to nothing. Low rent will certainly be necessary to help compensate for other significant costs as described in Vogue Business: “Printemps will own the products that are sold there. Printemps will employ the people who work there. […] It’s both an experiment and a gauntlet thrown.” Not to mention the cost of building this ultra-luxurious store concept.

Finally, Printemps wants to develop its e-commerce presence in the U.S. The company has launched a dedicated U.S. website to complement the store opening, us.printemps.com. This platform will be designed to provide American customers with access to Printemps' curated luxury offerings, aligning with its strategy to create a seamless omnichannel experience locally.

Don’t call it retail, but hospitality

Design and interior aesthetics

Parisian architect Laura Gonzalez was in charge of the store's interior. Shoppers will encounter mirrored walls, marble staircases, lavish hardwood floors and intricate detailing that echo the brand's Parisian flagship, as well as vintage furniture that is all moveable and for sale. The landmarked Red Room has been transformed into a beautiful shoe salon with a forest of “trees” lighting up footwear displayed on circular onyx tables. It is an impressive introduction to the store.

Printemps New York is not designed to be a conventional department store. Instead, Bellaiche describes it as a “hospitality project” where “French sophistication and curation meets American hospitality,” that encourages visitors to spend time inside rather than rush through quick purchases.

Inspired by a Parisian apartment and dubbed an “apartment store” by Thierry Prevost, General Manager of Printemps America, the store is divided into ten uniquely designed rooms, each offering a distinct shopping experience. The Boudoir houses eveningwear in a gold and lacquered ambiance, while La Garçonnière (translating to bachelor pad) houses menswear, and the Playroom features casualwear, gifts, and sneakers displayed under an LED ceiling that changes visuals (Nike takeover at the time of the opening). The Salle de Bain beauty and spa area, with four beauty cabins, offers luxurious treatments such as facials and nail services, reinforcing the store’s hospitality-driven approach.

Curated offerings

The store doesn’t advertise itself as a concept store even though it could be considering its surface, its layout and its interior designs. The store will sell men’s and women’s ready-to-wear, casual wear, outerwear, vintage, active, accessories, beauty, wellness and gifts. Unlike traditional department store layouts and the usual branded shop-in-shop model in fashion or beauty departments, Printemps NYC favours a multi-brand, curated selection of luxury goods from 450 established brands and niche labels landing in NYC for the first time. Dior, Manolo Blahnik, Valentino, Maison Margiela, JW Anderson, Jacquemus, Jean Paul Gaultier, Manolo Blahnik, Aquazzura, Balenciaga, Nike, Acne Studios, Simone Rocha, Carven, Jil Sander and Bottega Veneta are among the roster of brands, which will be completed by niche brands such as Vautrait, Le Monde Beryl, Corsi Design, Aeyde and Magda Butrym as well as small and artisanal French brands such as Joseph Duclos, Pinel & Pinel and Capulette. Big names such as Louis Vuitton are missing. As a result, the store offers a mix of exclusive items from high-end brands, artisanal products and vintage offerings. Additionally, Printemps integrates its private label, Saison 1865. Encouraging circularity, the Atelier & Repair service offers customers options beyond standard retail transactions.

It’s unsure whether these offerings will be enough to lure the affluent customers the store is targeting. But the mix of highs and lows indeed adds flair to the store. Printemps is not the only department store looking to behave more like an independent multi-brand store. Many luxury department stores try adding flair to the succession of shop-in-shops, thanks to curated multi-brand areas meant to differentiate and demonstrate the specific store's taste. For example, this is the case with L’Endroit and Le Market in Printemps and la Creative Galerie in Galeries Lafayette, in their Paris's Boulevard Haussmann flagship stores.

Finally, to differentiate from the department store’s traditional layout, one of the first contact points for shoppers will be a café, a similar strategy seen at the Boyner’s Cadde store, which has a Costa Coffee right at the entrance. Also, similar to the Printemps Haussmann store, a gift section featuring cheaper items such as candles will be featured at the store entrance.

Culinary experiences and events 

Now integral to any elevated retail experience, food offerings have become a department store staple. Research by Harrods showed that when customers engage with their 26 restaurants and bars, they spend twice as long in the building and twice as much money. Printemps follows a similar strategy and dedicates a third of the shop floor to F&B offerings. They have appointed Chef Gregory Gourdet as its culinary director who created five different concepts for the store: an all-day casual café, a classic Parisian-inspired raw bar called Salon Vert, the Red Room Bar for cocktails, and The Champagne Bar. There is also a French wine shop. However, the most critical F&B option is undoubtedly the Maison Passerelle restaurant. It aims for a Michelin star and is considered one of the 10 most important restaurant openings in NYC in 2025. It is instrumental to the strategy, and bookings are said to be already flooding in. Fine dining is increasingly vital to department store success: El Corte Inglés also successfully opened a Michelin star restaurant, RavioXO, in Castellana stores in 2022.

Beyond fashion and dining, Printemps integrates culture into its retail experience. The store will host curated events, brand takeovers (Jacquemus at the time of the opening), and even meditation sessions, further positioning itself as a destination rather than just a place to shop. With a focus on retail-tainment, Printemps hopes to fill the void left by Barneys New York and Jeffrey, former fashion landmarks that once led the city’s luxury shopping scene.

Printemps certainly plays by the book and ticks many boxes of what a department store is nowadays: a beautiful store concept, F&B options, a curated multi-brand offer, services and events, all with a Parisian flair that New Yorkers will probably like.

The story of One Wall Street and Printemps’ arrival in the Financial District is emblematic of a broader transformation in urban retail and real estate. As traditional office spaces become increasingly obsolete in a post-pandemic world, developers and retailers alike reimagine the possibilities of mixed-use destinations. One Wall Street’s conversion reflects this shift, blending residential and retail to attract affluent buyers.

Yet, with sluggish condo sales and a volatile retail market, Printemps’ long-term viability remains uncertain. Will Printemps and One Wall Street rewrite the narrative, or will they become yet another cautionary tale in the city’s high-stakes retail experiment? As stated in the Financial Times by Neil Saunders, managing director of Global Data, “they are definitely launching at a challenging time. Consumers are becoming a little more reluctant, the luxury market is a lot softer than it has been, and the environment is very competitive. That said, there is a case to have something else that’s a bit different. There is an opportunity for them to carve out a niche, but it won’t necessarily be easy.” Only time will tell, but one thing is sure: nothing is ever static in New York, and reinvention is the game's name.

Credits: IADS (Christine Montard)

What: Despite modest holiday sales improvement, Macy's faces mounting pressure from tariffs and cautious consumer spending, prompting aggressive store optimisation and supply chain restructuring.

Why it is important: The convergence of trade tensions, shifting consumer behaviour, and department store decline forces traditional retailers to fundamentally reimagine their business models, making Macy's response a bellwether for the industry's future.

Macy's, America's largest department store chain, reported a slight 0.2% increase in comparable sales across its stores, including Bloomingdale's and Bluemercury, marking its best performance in nearly three years. However, this modest improvement comes amid significant challenges, including consumer spending constraints and margin pressures. The company's turnaround strategy involves closing more than 60 of 150 planned store locations, whilst grappling with the impact of new tariffs on imports from Canada, Mexico, and China. CEO Tony Spring indicated that while current inventory levels shield the company from immediate tariff effects, future impacts will be assessed on a case-by-case basis. This cautious approach reflects broader industry concerns, with other retailers like Target and Best Buy warning of potential price increases for American consumers. Despite these challenges, some retailers, including Warby Parker and TJX, have implemented strategies to diversify their supply chains and minimise tariff exposure, demonstrating the industry's adaptive response to trade pressures.

IADS Notes: Macy's latest performance reflects significant retail transformation trends observed throughout 2024. In March 2024, the company launched a USD 100 million supply chain optimisation plan to address tariff impacts, while November 2024 reports showed the "First 50" pilot stores delivering consistent growth and improved customer satisfaction. The expansion of store closures announced in December 2024 aligns with May 2024 data showing department stores' market share had declined to just 2.6% of retail transactions, highlighting the urgency of transformation efforts. January 2025 results demonstrated strong performance in luxury segments, suggesting that while Macy's faces significant headwinds, its multi-brand strategy shows promise.

Macy’s signals rocky year ahead as retailers reckon with trade war

What: Leading retailers achieve 4.5% annual productivity growth by redefining efficiency through AI integration, marking a departure from the industry's decade-long 0.3% growth rate.

Why it is important: This shift represents a fundamental reimagining of retail productivity, where technology serves as an enabler of human capability rather than just a cost-reduction tool.

The retail industry is experiencing a transformative shift in how productivity is measured and achieved, moving beyond traditional cost-cutting approaches that have yielded only 0.3% annual growth over the past decade. High-performing retailers are demonstrating remarkable success, achieving 4.5% annual productivity growth by fundamentally redefining their approach to efficiency. The integration of generative AI, with 84% of retail executives planning increased investment, represents a pivotal strategy in this transformation. Drawing lessons from Sears' journey from innovation leader to bankruptcy, the article emphasises that sustainable growth requires continuous adaptation and strategic technology deployment. Rather than replacing human workers, AI serves as an enabler that automates routine tasks while empowering employees to focus on creative, strategic work. This new paradigm suggests that long-term retail success depends on reinvesting in both technology and people, fostering a culture of continuous learning and innovation.

IADS Notes: The retail industry's approach to productivity is undergoing a fundamental transformation through AI adoption, as evidenced by recent market developments. According to Vogue Business , 87% of retailers implementing AI witnessed revenue increases of 6% or more, alongside 15-30% improvements in customer service efficiency, demonstrating the shift from cost-cutting to value creation. This evolution is exemplified by a Retail Dive report , where Walmart's AI technology processed 850 million product data points, significantly enhancing operational efficiency and customer experience. The impact extends to consumer behaviour, with The Robin Report  showing 38% of shoppers actively using AI tools and 80% reporting positive experiences. The transformation is particularly evident in operational processes, as WWD  highlights retailers' transition from traditional Excel-based planning to AI-driven systems, enabling more dynamic inventory management and improved decision-making. This convergence of technological capability and practical implementation suggests that retail productivity is being redefined, with successful companies leveraging AI not just for cost reduction but for comprehensive value creation across their operations.

Redefining productivity In retail

What: Global trade tensions are forcing fashion retailers to balance sustainability commitments against rising tariff costs, reshaping industry practices and supply chains.

Why it is important: This dual pressure of trade tensions and sustainability requirements is catalysing fundamental changes in retail operations, from sourcing strategies to consumer pricing, potentially reshaping the industry's future.

The fashion industry faces a critical challenge as escalating trade tensions threaten to undermine sustainability commitments. With US President Trump wielding tariffs as a political weapon against both strategic rivals and traditional allies, fashion businesses are grappling with unprecedented uncertainty. Industry experts, including Michelle Gabriel from IE New York College, emphasise that effective strategic planning becomes nearly impossible under such volatile conditions. The impact extends beyond immediate operational concerns, potentially affecting long-term sustainability investments that often lack immediate returns. Environmental nonprofits warn against using tariffs as an excuse to retreat from climate goals, arguing that abandoning sustainability efforts would harm both supply chain workers and brand reputations. Industry leaders, including Colin Browne of Cascale, maintain that sustainability remains non-negotiable despite short-term trade concerns. The situation has prompted some companies to innovate, particularly in areas like artificial intelligence for material efficiency and circular business models, while others focus on practical approaches like factory-level improvements and supply chain optimisation.

IADS Notes: The retail landscape has undergone significant transformation since early 2025, with BCG projecting USD 640 billion in additional US import costs from tariffs. This economic pressure coincides with February 2025's EU regulations mandating retailer-funded textile waste management, while consumer data shows 60% of shoppers expressing increased climate concern despite price sensitivity. The industry's response has been innovative, as demonstrated by Peek & Cloppenburg's January 2025 launch of their sustainable store concept, showing how retailers can balance environmental responsibility with economic viability.

As tariffs cause chaos across fashion’s supply chain, what happens to sustainability?

What: US consumer confidence hits a three-year low in February 2025, with significant concerns about inflation, tariffs, and recession prospects, despite slight improvements in current business conditions and stable income expectations.

Why it is important: The contrast between current business conditions and future expectations highlights a critical juncture in consumer sentiment that could reshape retail spending patterns and force strategic adaptations across the industry.

Consumer confidence has plunged to its lowest level in over three years, reflecting growing unease about various economic conditions affecting household finances. The Conference Board Consumer Confidence Index's February decline of 7 points to 98.3 marks the third consecutive monthly decrease and the largest single-month drop since August 2021. While current business conditions showed slight improvement, consumers' outlook for the next 6-12 months has weakened considerably. Inflation expectations have surged from 5.2% to 6.0%, and the share of consumers expecting a recession has reached a nine-month high. The impact of tariffs is particularly concerning, with two-thirds of consumers anticipating price increases on typical purchases, though younger consumers show more willingness to wait and see. Despite these concerns, income expectations remain positive, suggesting potential continued spending in the near term, though with more selective and value-conscious purchasing behavior.

IADS Notes: The February 2025 consumer confidence decline reflects broader market challenges identified throughout recent months. As reported in February 2025, Trump's tariff announcements triggered significant consumer anxiety, with confidence indices showing their sharpest decline since 2021 . This concern is well-founded, as March 2025 analysis projects annual household costs increasing by USD 1,200 due to tariffs, with specific sectors facing price increases ranging from 0.81% to 1.63% . While January 2025 data showed potential for global economic growth at 2.8% , recent evelopments have dampened this outlook, with March 2025 data showing 62% of consumers expressing serious concerns about rising retail prices .

Major retailers are actively responding to these challenges, as evidenced by Macy's March 2025 announcement of aggressive store optimization and supply chain restructuring . This convergence of tariff pressures, consumer anxiety, and retail adaptation suggests a fundamental shift in market dynamics, requiring retailers to carefully balance pricing strategies with consumer sensitivity to cost increases. The situation is particularly complex given the varying responses across age groups and income levels, indicating the need for nuanced approaches to different consumer segments.

Few silver linings in the consumer mood as Americans grow more gloomy

What: Companies maintaining inclusive workplace practices achieve significant financial benefits, with potential global profit increases of USD 3.7 trillion through improved employee engagement and retention.

Why it is important: The financial impact of effective inclusion strategies demonstrates how workplace fairness translates directly to business success, making it a critical factor for retail competitiveness and growth.

In today's politically turbulent environment, business leaders remain committed to diversity and inclusion as fundamental drivers of business success. Research demonstrates compelling financial benefits, with inclusive workplaces showing a 50% reduction in turnover risk, 56% increase in performance, and 75% decrease in employee sick days. The potential impact is substantial, with estimates suggesting global profit increases of USD 3.7 trillion through better alignment between leadership perceptions and employee experiences. Despite ongoing efforts, the European CPG and retail industry still shows room for improvement, with women holding only 37% of executive roles. The consequences of exclusion are significant, with even single instances of micro-exclusion leading to immediate performance declines of 25%. The disconnect between leadership perception and employee experience remains notable, with 68% of leaders believing they create empowering environments, while only 36% of employees agree. This gap underscores the importance of moving from intention to action in creating truly inclusive workplaces that leverage the full spectrum of available talent.

IADS Notes: Recent retail industry developments strongly validate the article's emphasis on inclusion as a business imperative. Late last winter, research revealed a USD 32 trillion opportunity in women-focused products and services, reinforcing the text's projection of women controlling 75% of discretionary spending by 2028. The industry's response to inclusion has evolved significantly, as evidenced by Walmart's successful autumn strategy of maintaining inclusive practices while modifying terminology. This approach has influenced others, with Amazon subsequently rebranding its initiatives as "Inclusive eXperiences and Technology." However, the challenges highlighted in the text persist, particularly in leadership representation, as shown by recent data revealing only four of nine new creative director appointments representing women or people of colour. The emergence of the FAIR framework (Fairness, Access, Inclusion, and Representation) offers retailers a structured approach to achieving the article's vision of "going all in" while navigating complex market pressures.

The USD 3.7 trillion opportunity of inclusive leadership

What: Southeast Asian markets face significant investor pullback amid 18% decline in Jakarta's composite index and widespread currency depreciation, reflecting growing regional economic uncertainties.

Why it is important: This market response represents a key moment in Southeast Asia's retail evolution, testing the resilience of major investments like the USD 3.2 billion One Bangkok project and USD 665 million Central Retail digital transformation amid changing investor sentiment.

Southeast Asia's financial markets are experiencing significant turbulence, with Indonesia's Jakarta composite index plummeting 18% since mid-September 2024, including a dramatic 5% single-day drop that triggered trading suspension. Thailand's SET index faces similar challenges, with both countries' currencies weakening against major international currencies. This market volatility stems from a complex interplay of domestic and external factors. Internally, Thailand grapples with a struggling export-oriented economy and questionable stimulus measures, while Indonesia confronts weakening consumer purchasing power, corporate bankruptcies, and governance challenges at state-owned enterprises. The new Indonesian government's creation of a super-holding investment fund and tax revenue shortfalls have further eroded investor confidence. External pressures, particularly global trade disputes and economic uncertainty, are prompting investors to seek safer, more liquid assets in established markets. This shift reflects a broader trend of capital outflow from emerging markets during periods of heightened global risk, though the impact varies across the region's economies.

IADS Notes: Recent market data provides crucial context to the current investment climate in Southeast Asia. In March 2025, while the Jakarta composite index's 18% decline and Thailand's market contraction signal immediate challenges, the underlying retail sector shows a more nuanced picture. Central Retail's USD 665 million investment in AI integration (February 2024) and MM Mega Market's USD 20 million Vietnam expansion (November 2024) demonstrate continued confidence in the region's potential. The USD 3.2 billion One Bangkok project (October 2024) exemplifies Thailand's emergence as a luxury retail hub, even as the broader market faces headwinds. Vietnam's projected retail market growth to USD 350 billion by 2025 suggests that investors are taking a longer-term view despite current market volatility. This aligns with the broader trend of strategic adaptation, as evidenced by the region's increasing omnichannel penetration and tourism-driven recovery, indicating that while investors may be recalibrating their approaches, they are not fundamentally retreating from Southeast Asian markets.

Are investors pulling out of Southeast Asia?

What: Circular economy strategies are transforming retail through consumer-driven sustainability initiatives, creating new revenue streams while reducing environmental impact.

Why it is important: The convergence of consumer demand, regulatory pressure, and proven business success cases demonstrates how circular economy practices are becoming essential for retail survival and growth, as evidenced by recent industry-wide adoption of sustainable initiatives.

The retail industry is experiencing a fundamental transformation driven by sustainability and circular economy principles. Nearly one-third of shoppers now rank eco-friendliness as their primary consideration when making purchases, prompting retailers to adopt comprehensive circular strategies. These initiatives encompass product take-back programs, resale platforms, and sustainable packaging solutions, creating multiple benefits: increased customer loyalty, new revenue streams, and reduced environmental impact. The shift from traditional 'take, make, dispose' models to sustainable cycles is particularly evident in consumer behaviour, where environmental consciousness drives purchasing decisions. Retailers implementing circular practices not only satisfy customer demands but also secure their future in an evolving marketplace. This transformation extends beyond mere environmental considerations, offering significant business advantages through optimised resource use, emerging income from resale strategies, and strengthened brand reputation. The integration of these practices represents a strategic imperative for retailers, balancing profitability with environmental responsibility while meeting increasingly stringent regulatory requirements.

IADS Notes: Recent developments in retail sustainability demonstrate how circular economy strategies have moved from theoretical concepts to practical implementations. As reported in June 2024, the NRF's comprehensive guide revealed that successful retailers are adopting multiple circular approaches simultaneously, from product design to reverse logistics . This trend gained momentum when the EU introduced groundbreaking regulations in February 2025, requiring retailers to fund textile waste management and meet specific reduction targets . The commercial viability of sustainable retail was proven by Peek & Cloppenburg in January 2025, with their 32,000-square-foot green retail concept successfully combining eco-conscious merchandise with repair services . The resale market's strong performance, documented in January 2025, showed how traditional retailers are successfully integrating circular business models into their operations . These initiatives align with shifting consumer preferences, as December 2024 data revealed that 41% of consumers now choose repairs over replacement, while 24% actively purchase secondhand items . This convergence of regulatory pressure, business innovation, and consumer demand is transforming retail sustainability from a niche concern into a mainstream business imperative.

The benefits of a circular economy strategy in retail

What: Temu's ultra-low pricing strategy relies on a sophisticated Consumer-to-Manufacturer model and customs loopholes, enabling unprecedented market penetration but facing mounting regulatory challenges.

Why it is important: The success and challenges of Temu's pricing model represent a pivotal shift in global retail, demonstrating how digital platforms can bypass traditional supply chain costs while prompting regulatory responses that could reshape cross-border e-commerce.

Temu, the international arm of Chinese e-commerce giant Pinduoduo, has emerged as a formidable player in global retail through its innovative pricing strategy. Within just two years, the platform has achieved remarkable success, ranking fifth in France's online commerce and second globally. At the core of Temu's competitive advantage is its Consumer-to-Manufacturer model, which employs reverse auctions to secure the lowest possible prices from manufacturers. This approach, combined with a consigned inventory system, eliminates traditional storage costs and financial burdens for the platform. The company's success stems from its parent company Pinduoduo's established practices in China, where it has amassed 694 million users through group-buying features and strategic targeting of underserved market segments. Unlike traditional marketplaces, Temu generates revenue through logistics and marketing services rather than sales commissions, enabling its ultra-competitive pricing. However, this model faces increasing scrutiny, particularly regarding customs regulations and market practices, as evidenced by recent regulatory changes in major markets.

IADS Notes: Recent developments have significantly impacted Temu's business model and market position. In November 2024, Amazon launched its "Haul" platform in direct response to Temu's pricing strategy, while regulatory pressures intensified with the EU's implementation of stricter platform liability rules in February 2025. The elimination of the USD 800 de minimis rule in the US particularly threatens Temu's cost advantage, which has been central to its rapid growth. These challenges coincide with Forrester's October 2024 prediction of declining growth rates, suggesting that Temu's ultra-low pricing model faces mounting obstacles. The company's struggles in Southeast Asia, exemplified by its December 2024 suspension in Vietnam, further highlight the increasing scrutiny of its business practices. This evolving landscape indicates that while Temu's innovative approach to pricing and supply chain management has disrupted traditional retail, its long-term sustainability depends on adapting to stricter regulatory environments and intensifying competition.

The secret behind Temu’s rock-bottom prices

What: February's retail sales data in the US presents a mixed and confusing picture, with conflicting trends depending on the measurement method used.

Why it is important: The contradictory data highlights the challenges in accurately assessing the retail landscape, which is crucial for understanding consumer behaviour and economic health.

February's retail performance presents a perplexing array of statistics, showing a slight increase of 0.2% on a seasonally adjusted basis from January and a rise of 3.1% compared to February 2024. Conversely, year-over-year figures indicate a decline of 0.9% and a month-to-month decrease of 4% when unadjusted, as reported by the Census Bureau. This highlights the challenge of accurately assessing the retail landscape.

On a seasonally-adjusted basis, February 2025 retail sales reached $722.7 billion compared with $700.9 billion last year. However, unadjusted figures show that the retail and food services sector generated $639.1 billion in February 2025, a drop from $644.8 billion in the same month last year

IADS Notes: The discrepancy between seasonally adjusted and unadjusted data has led to criticism from industry experts. Paula Rosenblum, co-founder and managing partner at RSR Research, expressed frustration over the reliance on seasonally adjusted month-over-month data, questioning the rationale behind the Census Bureau's and National Retail Federation's use of such figures. It's worth noting that 2024 was a Leap Year, adding an extra day to February. On average, the retail and food services sector generated $22.2 billion daily in February 2024, compared to $22.8 billion in February 2025, indicating that consumer spending increased by nearly 3% daily this year compared to last, which aligns with inflation trends.

US February retail sales decline 0.9% year-over-year, but that’s just part of the story

What: A faulty security software update triggered the largest IT outage in history, affecting 8.5 million devices and exposing retailers' dependence on third-party technologies.

Why it is important: This incident reveals how non-malicious technical failures can cause more financial damage than cyberattacks, forcing retailers to reassess their technology dependency and disaster recovery strategies.

The Crowdstrike Falcon update incident of 2024 marked an unprecedented disruption in global retail operations, resulting in a staggering USD 5.4 billion in losses for Fortune 500 companies alone. This non-malicious technical failure affected 8.5 million Windows devices worldwide, disrupting essential retail operations from payment processing to inventory management. The incident's significance lies not just in its immediate impact but in its revelation of how deeply integrated third-party software has become in retail operations. While Crowdstrike's anti-malware solution typically protects against threats, this incident demonstrated that the same mechanisms enabling rapid security updates could also become vectors for system-wide failures. The retail sector's response highlighted a crucial paradox: while technology dependency creates vulnerabilities, it remains essential for modern retail operations. The incident has prompted a fundamental shift in how retailers approach technology risk management, emphasising the importance of rapid recovery capabilities over complete risk avoidance. This event serves as a watershed moment for the industry, demonstrating that resilience in modern retail requires both technological advancement and robust contingency planning.

IADS Notes: The Crowdstrike outage of March 2025 represents a watershed moment in retail technology vulnerability, echoing several significant incidents from the past year. In November 2024, the Blue Yonder ransomware attack demonstrated how third-party software disruptions can paralyze retail operations, affecting 3,000 retailers worldwide. The ripple effects of such incidents were further illustrated in March 2025 when El Corte Inglés faced a major data breach through an external provider, while El Palacio de Hierro's payment system disruption in August 2024 showed how even routine server updates can severely impact customer transactions. The complexity of retail technology integration was highlighted by Asda's USD 21 million inventory discrepancy during their SAP implementation in October 2024. However, success stories like Stripe's handling of USD 31 billion in Black Friday transactions while blocking nearly 21 million fraudulent attempts in December 2024 demonstrate that robust technology infrastructure and preparedness can effectively manage large-scale operations. These incidents collectively underscore the article's emphasis on the critical importance of rapid recovery capabilities and comprehensive contingency planning in modern retail operations.

How retailers can protect against costly IT outages and cyber disruptions

What: Research involving 3,268 consumers demonstrates that responsible AI features, particularly privacy and auditability, can increase product adoption rates by up to 63% while generating significant economic returns for retailers.

Why it is important: As retailers increasingly adopt AI technologies, with 87% of implementations leading to revenue growth, understanding consumer preferences for responsible features becomes crucial for successful market differentiation and adoption.

Recent research reveals a compelling business case for responsible AI (RAI) implementation in retail, challenging the notion that ethical considerations conflict with profitability. The study, involving 3,268 consumers, identified five key product design attributes: auditability, autonomy, personalisation, privacy, and understandability. Among these, privacy emerged as the most critical factor, with an average importance score of 31%, followed by auditability at 26%. Even when considering price and performance factors, privacy remained a crucial driver of consumer choice. The research demonstrates that incorporating responsible AI elements can dramatically increase adoption rates, from 2.4% to 63.19% for certain applications. However, despite 87% of managers acknowledging RAI's importance, only 15% feel well-prepared to implement these practices, highlighting a significant gap between awareness and execution. The findings suggest that companies must reconsider their resource allocation in product design, particularly when facing trade-offs between advanced capabilities and responsible implementation.

IADS Notes: The importance of responsible AI implementation is strongly supported by recent market developments. As noted in November 2024, transparency is crucial, with 75% of consumers expecting disclosure when interacting with AI-driven tools. This aligns with the growing demand for personalization, as 67% of customers seek personalised interactions with proper privacy safeguards. The business impact is significant, with companies reporting revenue increases of 6% or more, while meeting consumer expectations remains critical - 71% expect personalised interactions. The success of responsible implementation is evident in the 80% satisfaction rate among AI tool users, demonstrating the strong connection between responsible practices and business success.

How responsible AI protects the bottom line

What: Amazon defies social media boycott with 1% sales increase during the February 28th protest, demonstrating the platform's resilience and the gap between online activism and actual consumer behaviour.

Why it is important: This development underscores the challenge of translating social media movements into meaningful economic impact, particularly against platforms that have successfully integrated themselves into consumers' shopping habits.

Amazon's resilience during a planned February 28th boycott reveals the growing disconnect between social media activism and actual consumer behaviour. Data from Momentum Commerce shows transactions rose 1% compared to typical Friday patterns, with early-day performance reaching 6.8% above average before moderating in the afternoon. The e-commerce giant's ability to maintain sales growth during the protest highlights the platform's deeply embedded role in consumer shopping habits. While the People's Union USA plans additional boycotts, including a week-long action specifically targeting Amazon from March 7-14, the initial results suggest that transforming social media campaigns into significant economic impact remains challenging. The data demonstrates how established e-commerce platforms can withstand short-term consumer activism, raising important questions about the effectiveness of such protests in influencing shopping behaviour.

IADS Notes: Amazon's performance during the February 2025 boycott aligns with its demonstrated market resilience throughout 2024. In December 2024, the company achieved record-breaking holiday sales, with global online transactions reaching $74.4 billion despite economic challenges. This was followed by dominant performance in European markets, as evidenced by its Christmas 2024 success in France. The platform's ability to maintain growth during social pressure periods reflects its successful adaptation to changing consumer behaviors, supported by robust data analytics and strategic expansion into new retail segments.

Amazon defies ‘economic blackout’ as sales climb during boycott

What: Southeast Asian Ramadan retail sales surge 16% year-over-year, with Malaysia leading at 21% growth, driven by evolving digital shopping patterns and personalised retail strategies.

Why it is important: The significant growth in Ramadan retail sales demonstrates Southeast Asia's emerging role as a digital retail powerhouse, with consumers embracing sophisticated shopping patterns that combine traditional festivities with modern commerce.

Ramadan continues to strengthen its position as a crucial shopping period across Southeast Asia, with retail sales demonstrating remarkable year-over-year growth. From 2023 to 2024, sales surged by 16%, building on the previous year's 8% increase. Malaysia's predominantly Muslim market led the growth with a 21% increase in retail transactions, while Singapore posted a 7% rise. However, Indonesia experienced an 11% decline in online sales, highlighting the complexity of regional market dynamics. The shopping patterns during Ramadan have evolved significantly, with sales peaking during the final two weeks of the holy month. Consumer activity shows distinct temporal shifts, with online sales spiking during late-night and early-morning hours, particularly between Sehri and Iftar. Religious and ceremonial items dominated the growth categories with a 63% increase, followed by clothing at 23%. The transformation extends beyond retail, with the travel sector experiencing a 29% year-over-year increase in bookings. Retailers are adapting to these changing patterns by implementing sophisticated strategies, including targeted retail media placements and personalized product recommendations. The success of these approaches demonstrates the increasing sophistication of Southeast Asian consumers and the importance of combining cultural understanding with digital innovation.

IADS Notes: The strong Ramadan retail performance aligns with broader regional trends identified throughout early 2025. As noted in January 2025, Singapore's achievement of 13.3% online sales penetration demonstrates the region's growing digital maturity, while March 2025 reports showed most Southeast Asian countries achieving over 5% growth rates. February 2025 research revealed 90% of Asian consumers value AI-driven recommendations, supporting the success of personalised retail strategies during Ramadan. These developments reflect the sophisticated evolution of Southeast Asian retail, where cultural events are increasingly driving digital innovation and market adaptation.

Ramadan shopping trends unpacked: What retailers need to know

What: India's consumer landscape is undergoing a fundamental shift as affluent households are projected to reach 30% by 2035, while digital infrastructure, Gen Z preferences, and women's increasing economic influence reshape retail dynamics.

Why it is important: As traditional retail markets mature, India's evolving consumer landscape offers a blueprint for future growth, with its unique combination of digital innovation, demographic dividends, and infrastructure development creating new paradigms for global retail.

India's transformation into a global consumer powerhouse is reshaping retail paradigms, with affluent households projected to increase from 19% to 30% by 2035. This shift is characterized by a dramatic evolution in consumer behavior, moving beyond basic necessities to discretionary spending in education, travel, health, and leisure. India's Gen Z, surpassing the entire US population in size, is emerging as a powerful force that prioritizes immersive experiences and authentic engagement. The rising influence of educated women, whose literacy rates have doubled over four decades, is driving growth in sectors like packaged food, appliances, and online shopping. This transformation is supported by robust digital public infrastructure enabling seamless connectivity and personalized experiences, while massive infrastructure investments exceeding a trillion dollars are upgrading roads, bridges, and ports, fundamentally transforming logistics and connectivity.

IADS Notes: Recent market developments validate BCG's projections, with 27 new international brands entering India in early 2025 and the country ranking as the most attractive emerging market for retail expansion. The digital transformation is evident in Coresight's identification of GenAI-driven personalization as a key trend, while Euromonitor reports 48% of brands incorporating experiential rewards. This evolution is supported by substantial infrastructure development, with plans to add over 2 million square feet of retail space and a 46% increase in retail space leasing across major cities, creating new opportunities for retail expansion beyond Tier 3 cities.

When Indian consumers shape global trends