What: Are beauty brands less environmentally friendly than fashion brands?

Why it is important: It exposes the lack of transparency and accountability in the beauty industry's sustainability claims, urging for greater consumer awareness and industry reform.

A new report by sustainability rating platform Good on You highlights the challenges consumers face in navigating the beauty industry’s vague marketing terms like “clean” and “natural.” The report, which analysed nearly 240 beauty brands, found that the industry lacks transparency, with brands often failing to substantiate claims about their products, such as cruelty-free formulas or eco-friendly packaging. Compared to the fashion industry, the beauty sector struggles more with supply chain transparency and addressing human rights concerns. Good on You, which has previously assessed over 6,000 fashion brands, ranked most beauty brands as “Not Good Enough” or worse, with only a few, such as Disruptor London and Odylique, achieving high marks.

One major issue is the fragmented and complex nature of the beauty industry’s supply chains, making it difficult to track the sourcing of raw ingredients, such as palm oil and mica, both of which are linked to environmental and ethical concerns. Despite the industry’s struggles, some top-performing brands like Tropic, Pai Skincare, and Lush were recognized for their sustainability efforts. Good on You’s expansion into beauty comes as retailers face increasing scrutiny over greenwashing, with regulatory bodies demanding more transparency. The organization aims to empower both consumers and businesses to encourage positive change in the industry by providing clear sustainability rankings.

Are big beauty brands greenwashing worse than fashion?

What: Hong Kong's retail sales dropped by 10.1% in August compared to the previous year, marking the sixth consecutive month of decline.

Why it is important: The persistent decline in retail sales highlights ongoing economic challenges, influenced by a strong Hong Kong dollar, changing consumer habits, and increased travel abroad.

In August 2024, Hong Kong's retail sales fell by 10.1% year-on-year to HKD 29.2 billion (USD 3.8 billion), continuing a trend of declining sales over six months. Factors contributing to this decline include a strong Hong Kong dollar and shifts in consumer spending patterns, with more residents traveling abroad during holidays. Despite a slight increase in visitor arrivals, particularly from mainland China, the retail sector remains under pressure. Sales of high-value items like jewelry and watches saw a significant drop of 24%, while clothing and accessories sales fell by 12.3%. The government anticipates that easing exchange rates and potential U.S. interest rate cuts may offer some relief to the sector.

Hong Kong retail sector faces decline amid economic challenges

What: Zalando is launching a generative AI-powered personal assistant across all its markets and expanding its disability-friendly fashion line to include children's clothing.

Why it is important: The introduction of AI technology and an inclusive fashion line demonstrates Zalando's commitment to innovation and inclusivity, enhancing customer experience and catering to underserved markets.

Zalando, a leading German clothing retailer, is rolling out its new AI-powered personal assistant across all 25 of its markets as of October 1. This tool, which utilises OpenAI’s ChatGPT, has been tested in Germany and English-speaking countries. It is designed to enhance the shopping experience by providing personalised fashion recommendations based on user preferences, location, and weather conditions. For example, users can ask the assistant for outfit suggestions for specific events, like a birthday in Barcelona, and receive tailored recommendations.

In addition to the AI assistant, Zalando is expanding its "Trend Spotter" tool to more European cities, allowing users to discover both local and international fashion trends. Furthermore, the company is launching a unified partner program called "Zalando Partner," streamlining services for brands and retailers through a single platform.

On the product front, Zalando is strengthening its Adaptive line, which caters to individuals with disabilities. This collection now includes children's clothing, offering a range of items from basics to trendy pieces. These developments coincide with Zalando's shift from a paid loyalty program to a free-tiered system that provides increasing rewards and benefits.

Despite a slight decline in sales volume and revenue in 2023, Zalando has shown signs of recovery in 2024. The company's strategic initiatives aim to drive further growth by enhancing customer engagement through technology and inclusive product offerings.

Zalando's AI assistant and inclusive fashion line for children

What: British retailer John Lewis is "quietly optimistic" about its trading prospects leading up to Christmas, despite potential tax increases from the new Labour government's budget.

Why it is important: This optimism indicates confidence in consumer spending resilience despite economic uncertainties, and highlights John Lewis's strategic investments and performance ahead of crucial trading periods.

John Lewis, a prominent British department store retailer, has expressed cautious optimism about its trading outlook for the upcoming Christmas season. This sentiment comes amid concerns over potential tax hikes in the forthcoming budget presented by the new Labour government. Peter Ruis, the executive director of John Lewis, shared that both the John Lewis department store and Waitrose supermarket chain are currently performing better than anticipated in their Christmas plans. Speaking at a media event at their flagship store on Oxford Street, Ruis noted that while there is considerable media interest in the budget due to the new government, it typically does not significantly impact customer behaviour. Additionally, John Lewis has announced plans to invest GBP 800 million (USD 1.04 billion) in its brand over the next four years, signalling a commitment to strengthening its market position and enhancing customer experience.

John Lewis expresses cautious optimism for Christmas trading

What: Experts predict that Black Friday 2024 will see cautious consumer spending, supply chain challenges, and strategic promotional efforts as retailers prepare for the upcoming sales period.

Why it is important: Understanding these dynamics is crucial for retailers to effectively plan their strategies, optimise inventory management, and maximise sales during a critical shopping season.

Black Friday 2024, set for November 29, is approaching, and retailers are strategising to navigate consumer behaviour and supply chain challenges. While consumer confidence has improved with easing inflation in the US and UK, spending remains cautious. Analysts note that while interest in Black Friday may increase, retailers must work hard to demonstrate value and incentivise spending. The luxury sector faces a slowdown, with consumers preferring direct brand purchases over multi-brand retailers.

Supply chain disruptions pose additional challenges. Potential strikes at US East Coast ports could affect apparel imports, prompting retailers to consider more expensive air freight options. Geopolitical conflicts have also disrupted shipping routes between Asia and Europe. These factors may lead to less steep discounts as retailers manage increased costs.

In terms of inventory, UK retailers face excess summer stock due to a rainy season, while US inventory levels are more balanced. Beauty products are expected to perform well due to the "lipstick effect," where consumers indulge in smaller luxuries. Retailers are extending Black Friday promotions throughout November and December, focusing on precision over mass discounts to protect margins.

Promotional strategies will include value-driven offers like bundled deals and loyalty benefits. These approaches are particularly relevant for luxury brands aiming to maintain their positioning. The success of Black Friday will influence the entire holiday sales period, with retailers seeking sustainable growth through strategic planning.

Navigating Black Friday 2024: strategies and challenges

What: Neiman Marcus rebrands its historic 98-year-old "Christmas Book" gift catalogue to "Holiday Book," sparking internal debate about tradition versus inclusivity amid broader company changes.

Why it is important: The internal response to this marketing shift reveals deeper tensions within retail organizations as they navigate cultural transformations while preparing for major corporate restructuring.

Neiman Marcus has made a significant change to its retail tradition by rebranding its 98-year-old "Christmas Book" gift catalogue to "Holiday Book." This subtle yet meaningful shift marks the first such change in the catalogue's history, which had been previously defended by the company's leadership as an integral part of their legacy. The decision represents a departure from the company's 2021 stance, when Chief Marketing Officer Daz McColl had emphasized the Christmas Book's role in tradition and celebration, stating it wasn't "exclusionary in any way." The rebranding, explained as a move to welcome customers of all backgrounds, religions, and traditions, has sparked controversy within the organization, particularly among seasoned employees at the Dallas headquarters. The timing of this change, coinciding with a period of significant corporate restructuring and a pending $2.65 billion deal with Saks Fifth Avenue, has amplified internal concerns. Employees have expressed frustration not only about the change itself but also about the communication process, with many learning about the rebranding through media reports rather than internal channels.

IADS Notes: Neiman Marcus's decision to rebrand its 98-year-old "Christmas Book" to "Holiday Book" reflects broader organizational changes within the company. This shift comes at a time when the retailer has been actively working on inclusivity initiatives, evidenced by their perfect score in the Human Rights Campaign's Corporate Equality Index in January 2024 . The rebranding aligns with CEO Geoffroy van Raemdonck's November 2023 vision of building a culture based on "love, authenticity, and embracing diversity" . However, this change has created internal tension, particularly as it coincides with broader organizational uncertainties surrounding the pending USD 2.65 billion Saks merger . The company's October 2024 holiday campaign, focusing on "fantasy and nostalgia" rather than traditional Christmas themes , further demonstrates this delicate balance between maintaining heritage and embracing inclusive marketing strategies.

Neiman Marcus 'bans' the word Christmas from its almost century-old gift catalogue to the fury of its workers

What: Frasers Group continues aggressive expansion with the purchase of over 1 million sq ft of retail space across three strategic locations in the UK.

Why it is important: By securing prime retail locations, Frasers Group is not just expanding its footprint but also gaining strategic control over key shopping destinations, potentially revolutionizing the tenant mix and shopping experience to align with its multi-brand strategy.

Frasers Group has acquired over 1 million sq ft of retail assets, including Princesshay Shopping Centre in Exeter, Fremlin Walk Shopping Centre in Maidstone, and the Olympus Centre in Quedgeley. The company plans to enhance the shopping and leisure offerings within these locations by introducing elevated retail formats and improving the current tenant mix. Fremlin Walk is already undergoing extensive refurbishment ahead of opening a multi-brand 70,000 sq ft Frasers flagship store. The strategic position of the Olympus Centre will help capture the thriving local catchment population in Gloucester. Frasers Group CEO Michael Murray emphasised the company's commitment to investing in physical retail and revitalising high streets across the country. This move aligns with Frasers' strategy to reinvent and elevate retail experiences for UK shoppers by bringing top brands and environments to customers nationwide.

IADS Notes: Frasers Group has been on an aggressive expansion spree in the UK retailproperty market. In October 2024, the company acquired three significant shopping centres: Princesshay in Exeter, Fremlin Walk in Kent, and the Olympus Centre in Gloucester. This follows their July 2024 purchase of Doncaster's Frenchgate shopping centre, a 770,000 sq ft mall attracting over 16 million customers annually. Earlier in May 2024,Frasers was eyeing a 50% stake in Exeter's Princesshay estate, potentially marking their first collaboration with the Crown Estate. These acquisitions align with Frasers' strategy to invest in prime retail locations and introduce their brand portfolio, including Sports Direct, Flannels, and USC. The company's commitment to physical retail is further evidenced by its expansion into the Queensgate Centre in Peterborough, where they plan to open new Frasers and Sports Direct stores in a space formerly occupied by John Lewis.

Frasers Group acquires three UK shopping centres

What: The Printemps store in Marseille's La Valentine district has completed a seven-month refurbishment, enhancing its retail space and brand offerings.

Why it is important: This refurbishment represents a strategic move to revitalise the Printemps store by increasing its selling space and introducing 80 new brands, aiming to maintain customer excitement and improve shopping experiences in a competitive retail environment.

The Printemps department store in Marseille's La Valentine district has undergone a significant refurbishment, which took seven months to complete. This renovation aimed to transform the store's vast 7,230 square metre (77,823 square foot) single-floor space into a more dynamic and engaging retail environment. Although the overall footprint of the store remained unchanged, the selling space was increased by approximately 25%, allowing for a more extensive display of merchandise.

The refurbishment process was carried out in 13 stages, beginning with the Home section and concluding with womenswear, while the store remained operational throughout. This ambitious project introduced 80 new brands to the store, enhancing its appeal to a broader range of customers. The design strategy focused on creating distinct lifestyle areas within the department store while ensuring that these spaces were not too enclosed, promoting visual navigation and an open shopping experience.

This renovation aligns with Printemps' goal of maintaining excitement and interest among shoppers in a traditional department store setting. The La Valentine location complements another Printemps store situated in Marseille's city centre port area, expanding the brand's presence and accessibility in the region.

Printemps La Valentine completes major refurbishment

What: Adidas ups profit forecast to £1bn as Samba and Gazelles soar.

Why it is important: It highlights Adidas' financial recovery and growth, driven by popular products and strategic management despite challenges from its split with Ye.

Adidas has raised its full-year financial guidance for the third time this year, following a strong third quarter driven by the success of its Samba and Gazelle trainers. The company reported a 46% increase in operating profit, rising from GBP 342 million (EUR 409 million) to GBP 500 million (EUR 598 million), which included a contribution of GBP 41.8 million (EUR 50 million) from the sale of parts of its remaining Yeezy inventory. Sales also saw a 7% growth, reaching GBP 5.39 billion (EUR 6.44 billion), prompting Adidas to revise its full-year operating profit forecast to GBP 1 billion (EUR 1.2 billion), up from GBP 837 million (EUR 1 billion).

This financial improvement comes amid a broader turnaround effort led by CEO Bjørn Gulden, who has been steering the company following its split with rapper Ye, formerly known as Kanye West, which left Adidas with £1 billion worth of unsold Yeezy shoes. While sales of the remaining Yeezy inventory are expected to contribute GBP 41.8 million, the company does not anticipate any additional profit from these sales in the fourth quarter. Adidas now forecasts currency-neutral sales growth of around 10%, a slight increase from its previous high-single-digit expectation.

Adidas ups profit forecast to GBP 1bn as Samba and Gazelles soar

What: Amazon plans to hire 250,000 transportation and warehouse workers for the holiday season, maintaining the same hiring level as last year.

Why it is important: This hiring plan reflects Amazon's strategy to manage increased e-commerce demand during the holiday season while highlighting its competitive stance in the retail labour market despite broader economic challenges.

Amazon has announced its intention to hire 250,000 seasonal workers for the upcoming holiday shopping season, matching last year's hiring numbers. This decision aligns with expectations of a 4.9% increase in online holiday spending, projected to reach a record USD 240.8 billion. While overall holiday spending is anticipated to rise by 3.2%, Amazon's hiring approach underscores its commitment to meeting heightened e-commerce demands.

The seasonal workforce will include positions in sort centres, fulfilment centres, and delivery stations, although specific allocations between fulfilment and transport roles remain unspecified. Notably, transport roles will exclude delivery service partners and their teams. Despite maintaining flat hiring numbers compared to last year, Amazon's recruitment plan surpasses that of competitors like Target, which plans to add 100,000 workers.

This announcement comes amid a softer U.S. labour market, with retailers expected to add 520,000 jobs this season, down from last year's 564,200. Additionally, Amazon faces scrutiny from the National Labor Relations Board regarding its status as a "joint employer" of drivers for Battle Tested Strategies (BTS), following unionization efforts by BTS drivers.

Amazon to hire 250,000 seasonal workers for holidays

What: Saks Global has partnered with Authentic Brands Group to form a joint venture called Authentic Luxury Group, aiming to expand luxury brands like Barneys New York and Hervé Léger globally.

Why it is important: This collaboration represents a strategic effort to grow luxury and accessible luxury brands worldwide, leveraging the strengths of both Saks Global and Authentic Brands Group. It highlights the potential for significant expansion in high-growth markets, creating new opportunities in the luxury retail sector.

Saks Global and Authentic Brands Group have announced a new joint venture named Authentic Luxury Group, focusing on expanding luxury and accessible luxury brands globally. This venture will initially concentrate on brands owned by Authentic Brands, such as Barneys New York, Judith Leiber Couture, Hervé Léger, and Vince. The partnership aims to serve as an incubator for brand growth through strategic licensing agreements and distribution across various sectors, including fashion, retail, digital, hospitality, real estate, art, and travel.

Richard Baker of Saks and Jamie Salter of Authentic Brands discussed their ambitious plans to roll out Barneys retail locations or in-store shops, expand existing brand categories, and widen distribution both in the U.S. and internationally. The venture also plans to purchase additional brands and enhance the distribution network.

The partnership builds on a relationship established in 2019 when Authentic Brands acquired Barneys out of bankruptcy. The joint venture will explore opportunities in markets like South Korea, China, and India, aiming to build a multibillion-dollar platform over the next five years. Additionally, the venture intends to advance Saks Off 5th and explore new possibilities for Bergdorf Goodman.

This initiative comes at a time when the luxury sector is facing challenges, but both companies see it as an opportunity to capitalise on their combined strengths to drive growth and innovation in the luxury market.

Saks and Authentic Brands Group forge global luxury venture

What: Cash-rich retailers are diversifying their investments by purchasing and developing retail properties, demonstrating confidence in brick-and-mortar retail.

Why it is important: By investing in prime retail locations, these companies are positioning themselves for long-term success in an evolving retail landscape, balancing online growth with physical store experiences.

Retailers, particularly those with strong financial positions, are increasingly becoming major players in the real estate market. Two companies in Europe, Ingka Centres (IKEA's property arm) and Frasers Group, have been particularly active in acquiring shopping destinations across major cities. Ingka Centres has purchased centers in London, Brighton, Paris, and Munich, often introducing IKEA stores as anchors. Frasers Group has acquired numerous properties in the UK, including the Frenchgate shopping center in Doncaster, Overgate Center in Dundee, and The Mall Luton. These acquisitions are driven by the retailers' strong operational performance and confidence in the future of physical retail. For Ingka Centres, the strategy involves creating mixed-use developments that combine retail, offices, and IKEA stores. Frasers Group, on the other hand, uses its multi-brand portfolio to fill much of the acquired space with its own stores, including Sports Direct, Flannels, and Frasers department stores. The trend is limited to cash-rich retailers with successful brands or multiple brands that can anchor these centers. Both companies see these acquisitions as opportunities to deploy capital effectively, often acquiring properties at favorable prices. This strategy allows them to control their retail environments, potentially leading to cost savings and enhanced customer experiences.

IADS Notes: Frasers Group has been particularly aggressive in its property acquisition strategy, recently acquiring three new shopping centres including Princesshay in Exeter, Fremlin Walk in Kent, and the Olympus Centre in Gloucester. This follows earlier acquisitions such as Fremlin Walk in Maidstone and St Nicholas Arcade in Lancaster. IKEA's Ingka Centres has also been active, acquiring Churchill Square in Brighton and repurposing former Debenhams spaces into IKEA stores. These moves demonstrate a significant shift in the retail real estate market, with retailers taking control of prime locations to enhance their brand presence and implement multi-brand strategies. This approach represents a modern adaptation of the historical strategy of department stores owning their properties, now applied in response to changing market dynamics and the challenges posed by e-commerce.

Why are IKEA and Frasers retailers buying malls? 

What: UK shop prices fall for the second consecutive month, reaching the lowest rate in over three years, signalling potential easing of the cost of living crisis.

Why it is important: This trend suggests a turning point in the UK's economic landscape, potentially easing pressure on consumers and reshaping retail strategies in response to changing market conditions.

UK shop prices have decreased for the second consecutive month, with a 0.6% annual fall in September, marking the lowest rate since August 2021. This data, provided by the British Retail Consortium, indicates a potential easing of the cost-of-living crisis that has affected millions of households.

The decline is primarily driven by non-food items, which saw a 2.1% annual price drop, the most significant since March 2021. However, food inflation slightly increased to 2.3% in September from 2% in August, due to higher prices for cooking oils and sugary products linked to poor harvests in key producing regions.

This trend reflects a broader shift in the retail landscape. Major retailers like Ikea have slashed prices on thousands of products in response to easing cost pressures. During the Black Friday period, UK retailers increased discounts to attract customers who were cutting spending. Similarly, M&S extended its price lock on essential food items until Easter to address ongoing cost-of-living concerns.

While challenges remain, including potential geopolitical tensions and climate change impacts, this price deflation suggests a potential turning point in the UK's economic recovery.

IADS Notes: The UK retail landscape is showing signs of adaptation to changing economic conditions and consumer behavior. Ikea's decision to slash prices on thousands of products reflects easing cost pressures and a strategy to attract cost-conscious consumers. This aligns with the broader trend seen during the Black Friday period, where UK retailers increased discounts in response to customers cutting spending. M&S's extension of its price lock on essential food items until Easter further underscores retailers' efforts to address ongoing cost of living concerns. These actions collectively demonstrate how major retailers are responding to inflationary pressures and shifting consumer priorities, balancing the need to maintain sales volume with the challenges of a price-sensitive market. The varying strategies across different retail sectors highlight the complex nature of the UK's economic recovery and the nuanced approaches businesses are taking to navigate this period.

UK: cost of living crisis shows signs of receding as stores try to lure back bargain hunters

What: Falabella Group, in collaboration with the Arturo López Pérez Foundation, provides free mammograms to its female employees through a company-wide initiative called "The Mammography Route."

Why it is important: This initiative demonstrates Falabella Group's commitment to employee health and well-being by facilitating early detection of breast cancer, which is crucial for improving survival rates.

Falabella Group has partnered with the Arturo López Pérez Foundation (FALP) to offer "The Mammography Route," a programme providing free mammograms to female employees over 30. This initiative spans across the entire company, reaching various Falabella stores, distribution centres, and offices throughout Chile. The mobile clinics ensure easy access to this essential health service, promoting early detection of breast cancer. Last year, 2,021 employees benefited from the programme, and by September this year, 1,381 have already participated. The initiative aims to reach 1,764 women by November. Breast cancer remains a leading cause of death among women in Chile, and early detection significantly enhances survival chances. Through this company-wide effort, Falabella Group is raising awareness and prioritising the health of its employees by encouraging regular mammography screenings.

Falabella Group's company-wide mammography initiative

What: Fenwick has reported a pre-tax loss of £28.4 million for the year ending January 26, 2024, as sales fell by 7% in a challenging retail environment.

Why it is important: The financial downturn highlights the pressures faced by traditional department stores amid high inflation and competitive discounting. Fenwick's focus on improving its operating model and enhancing both online and in-store experiences is crucial for its return to profitability.

Fenwick, the UK department store chain, has reported a significant financial loss due to a challenging retail environment characterised by high inflation and increased competition. The company posted a pre-tax loss of GBP 28.4 million compared to a profit of GBP 57.1 million the previous year, with sales declining by 7% to GBP 184.2 million. The retailer attributed these challenges to high mortgage rates and inflation exacerbating the cost-of-living crisis, as well as aggressive discounting by competitors affecting its pricing strategies. In response, Fenwick is focusing on enhancing its operating model, particularly online, and aims to boost revenue growth and profitability through improved customer service and product margin preservation. Recently, Fenwick unveiled an expanded beauty hall at its Newcastle flagship store, showcasing 163 brands. Additionally, the company faced leadership changes as incoming CEO Nigel Blow was blocked from taking the position due to allegations against Harrods’ former owner, Mohamed Al Fayed.

Fenwick faces GBP 38.1 million loss amid retail challenges

What: The property value of Selfridges has decreased by over GBP 600 million, with loans maturing soon, amid recent changes in ownership stakes.

Why it is important: This substantial devaluation and looming loan maturities highlight the financial challenges facing Selfridges, impacting its strategic decisions and ownership structure, particularly following the investment by Saudi Arabia's Public Investment Fund.

The value of Selfridges' property portfolio has been reduced by GBP 638.6 million, marking a 20.6% drop from its previous valuation of GBP 3.1 billion. This devaluation affects key assets such as the Oxford Street flagship store in London and the Manchester Exchange Square location. The decline is attributed to external market factors, including rising interest rates and market rent conditions. Over GBP 1.7 billion in loans are secured against these properties, with maturity set for August 2025. Recently, Saudi Arabia's Public Investment Fund acquired a 40% stake in the Selfridges Group, which includes stores like De Bijenkorf and Brown Thomas. This acquisition follows the financial instability and subsequent collapse of Signa Holding, a previous co-owner alongside Central Group. In response to financial obligations, Central Group lent Selfridges GBP 98.1 million earlier this year. The Selfridges Group's structure is divided into two entities: one for property assets and another for operating business, with accounts for the latter yet to be filed.

Selfridges faces significant property devaluation amid financial restructuring

What: John Lewis becomes patron of British Beauty Council, reinforcing its commitment to the beauty industry and recent growth in beauty sales.

Why it is important: By joining forces with the British Beauty Council, John Lewis positions itself to shape industry trends and policies, potentially influencing future growth opportunities in the beauty sector.

John Lewis has become a patron of the British Beauty Council, a not-for-profit organization that engages with businesses and government to address the needs of the beauty sector. This partnership reflects John Lewis's commitment to supporting the beauty industry and promoting growth opportunities, as beauty is a crucial part of its retail offering. In the first half of 2024, John Lewis reported a 6.8% increase in beauty sales compared to the previous year. The company has also invested significantly in its in-store beauty experience, with beauty hall refurbishments taking place in its Oxford Street, High Wycombe, and Cheadle stores. This focus on beauty aligns with John Lewis's recent strategic shift back to its core retail business. In March 2024, the company abandoned its previous goal of generating 40% of profits from non-retail ventures by 2030, instead concentrating on strengthening its retail operations after posting its first profit in four years.

IADS Notes: John Lewis's partnership with the British Beauty Council comes at a time of significant strategic shifts for the company. According to our  database, in March 2024, John Lewis reported a return to profitability after three consecutive years of losses, with an anticipated £25m profit for the year (Retail Gazette, March 2024). This financial turnaround coincided with a major strategic pivot, as John Lewis abandoned its earlier diversification plans and refocused on its core retail business (Retail Gazette, March 2024). The company's commitment to retail is further evidenced by its announcement of a record £542m investment earmarked for store refurbishments and expansions (Retail Gazette, March 2024). This renewed focus on retail, particularly in the beauty sector, aligns with the company's recent success in beauty sales and its new role as a patron of the British Beauty Council.

John Lewis has joined the British Beauty Council as a patron

What: Marks & Spencer (M&S) is hiring over 11,000 customer assistants for the festive season, exceeding last year's recruitment by more than 1,000 roles.

Why it is important: This recruitment drive is crucial for M&S to meet increased demand during the busy Christmas trading period, ensuring efficient service delivery and enhancing customer experience.

Marks & Spencer has announced its Christmas recruitment program, aiming to hire over 11,000 new customer assistants to support its stores during the festive season. This initiative marks an increase of more than 1,000 roles compared to last year, reflecting the retailer's preparation for heightened demand. The new hires will play a vital role in M&S's food and clothing and home business sectors, particularly in delivering its Christmas food to order service.

The recruitment window opens on October 9, with new employees expected to join from mid-November. M&S operations director Sacha Berendji emphasized the importance of these roles in delivering the "magic of M&S at Christmas" and highlighted opportunities for career progression through programs like the Stepping Into Team Manager initiative. M&S offers a variety of roles with flexible working patterns, inviting interested individuals to apply through their careers website.

M&S launches recruitment for 11,000 festive roles

What: Walmart is accelerating its Adaptive Retail strategy by integrating generative AI, augmented reality, and personalisation to create immersive shopping experiences across its stores, apps, and websites.

Why it is important: This initiative aims to differentiate Walmart from competitors by tailoring shopping experiences to individual customer preferences, improving search and discovery, and enhancing both online and in-store interactions.

Walmart is ramping up its Adaptive Retail strategy to leverage generative AI, augmented reality, and personalisation. The retailer has developed a series of large language models called Wallaby, trained on decades of internal data, to support customer-facing assistants and experiences. Wallaby will work with other language models to provide highly tailored responses within the Walmart environment.Walmart has also created an AI-powered Content Decision Platform designed to predict and display content on its website that aligns with each customer's interests, resulting in unique homepages for every user. This updated website is expected to launch in the United States by the end of 2025.

Throughout the year, Walmart has been rolling out generative AI tools, including enhanced search features on its app and an AI shopping assistant tested with select customers. These updates aim to reduce customers’ time searching and browsing online by allowing natural language queries and providing more accurate responses.

In addition to online improvements, Walmart's tech investments enhance in-store experiences. Generative AI has improved the quality of over 850 million pieces of data in its product catalogue, aiding store and warehouse associates in locating products and preparing deliveries more efficiently. The company also credited these associate-facing tools for a successful holiday season last year.Walmart is further expanding its shopping experiences through an augmented reality platform called Retina, which will enable customers to shop in virtual social environments. However, specifics and a launch date have not been disclosed.

Walmart's AI-powered personalized homepages revolutionise shopping

What: Macy’s is launching both indoor and outdoor holiday markets at its Herald Square flagship, featuring over 50 vendors offering a variety of gift-oriented merchandise.

Why it is important: This initiative expands Macy’s holiday shopping experience, blending traditional outdoor market charm with indoor convenience, enhancing customer engagement and supporting diverse vendors during the festive season.

Macy’s is set to transform its Herald Square flagship into a festive shopping destination with the introduction of "Holiday Square by Urbanspace," an indoor market inspired by New York's renowned outdoor holiday markets. This new format will occupy 3,000 square feet across various floors of the store, featuring more than 30 businesses selling gifts, food, and beverages. The market will include unique items such as Amsterdam stroopwafels, Italian chocolates, Crumbl Cookies, and personalized ornaments. A digital holiday activation map with QR codes will guide shoppers through the vendor offerings from November 1 to January 3. Additionally, starting December 6, approximately 50 vendors will set up stalls outside the flagship store. Macy’s will also participate in The Holiday Shops at Bryant Park from October 25 to January 5, offering products related to Macy’s Thanksgiving Day parade and other gifts. This initiative is part of Macy’s broader strategy to create engaging and inclusive holiday experiences both online and in-store. Alongside these markets, Macy’s will host traditional holiday attractions like Santaland and the Great Tree display at various locations. Furthermore, from November 1 to December 24, Macy’s will support the Big Brother Big Sister mentoring organization through a donation campaign.

Macy’s introduces indoor and outdoor holiday markets

What: Chinese retail sales inch up as regional disparities persist, while the economy shows signs of gradual recovery despite luxury segment struggles.

Why it is important: This nuanced retail landscape reflects China's complex economic recovery, challenging global brands to adapt their strategies in the world's second-largest consumer market.

China's retail sector is experiencing a modest recovery, with sales rising by 2.1% in August and 3.3% year-to-date. This growth, while positive, reveals a complex landscape of regional variations and sector-specific challenges. Cities like Shanghai, Shenzhen, and Guangzhou are showing relative strength, while Beijing faces softer market conditions. The food and beverage sector is thriving, accounting for over 40% of leasing activity in Tier 1 and 2 cities, partly due to its ability to attract foot traffic.

However, the luxury segment is struggling, with brands like Nike reporting weak performance in Greater China. This contrasts with the success of mid-market retailers like Walmart, which saw significant growth in same-store sales and e-commerce penetration. The divergence in performance across different retail segments reflects changing consumer preferences and economic conditions.

On a broader economic scale, China's GDP expanded by 5.0% in the first half of the year, with inflation beginning to edge up slightly. This gradual economic recovery provides a backdrop for the retail sector's performance, suggesting cautious optimism tempered by ongoing challenges in consumer spending and market dynamics.

IADS Notes: China's retail landscape in 2023-2024 presents a mixed picture, with modest overall growth amidst significant regional variations. Retail sales showed a slight increase, reflecting cautious consumer spending. Regional differences are evident, with some cities demonstrating strength while others face challenges. The luxury segment is experiencing difficulties, exemplified by weak performance in Greater China. On a broader economic scale, China's GDP expanded in the first half of the year, with inflation beginning to edge up slightly, indicating a gradual economic recovery despite retail sector challenges.

‘Encouraging signs’: Unpacking China’s latest retail sales

What: TK Maxx sales top GBP 4bn for the first time.

Why it is important: It highlights TJ Maxx’s strong sales growth despite a sharp drop in profits, underscoring consumer demand for discounted goods in a challenging economic climate.

TJ Maxx’s UK arm, which operates TK Maxx and Homesense, reported a significant drop in pre-tax profits for the 53 weeks ending February 2024 despite achieving record sales of over GBP 4 billion. Pre-tax profits fell by 42%, from GBP 172.4 million to GBP 120.7 million, largely due to a one-off exceptional credit of GBP 58.8 million in the previous year. However, sales increased by 3.6% to GBP 4.03 billion, driven by a growing demand for discounted designer items. Like-for-like sales also rose by 3%, boosted by higher foot traffic as consumers returned to in-person shopping following the pandemic.

The retailer expanded its presence by opening four new TK Maxx stores and one new Homesense location, bringing the total number of UK stores to 432. It also plans to open a second flagship store on Oxford Street later this year, having secured a 22,500 square foot space at Mount Royal in March. This expansion reflects the company's confidence in the continued appeal of its value-driven business model as more shoppers seek bargains in an inflationary environment.

TK Maxx sales top GBP 4bn for the first time

What: Artificial Intelligence (AI) is revolutionising backend systems in the retail sector by enhancing efficiency, accuracy, and cost-effectiveness through demand forecasting, automation, fraud detection, and staff support.

Why it is important: The integration of AI in retail backend processes not only improves operational efficiency and customer satisfaction but also strengthens data security and supports staff, making it a crucial differentiator for retailers in a competitive market.

AI is being increasingly utilised to simplify and optimise backend systems in the retail industry, resulting in significant improvements in efficiency, speed, accuracy, and cost savings. This technological advancement benefits not only staff and customers but also partners such as suppliers. Here are four key ways AI is being deployed behind the scenes:

Demand Forecasting: AI analyses extensive historical sales data, customer behaviour, and external factors to predict future demand more accurately. Machine learning models enhance these predictions by identifying patterns, allowing retailers to optimise inventory management and reduce overstock and stockouts. This capability enhances customer satisfaction by ensuring popular products remain in stock.

Automation: AI automates repetitive tasks like data entry and invoice processing, reducing administrative burdens on staff while improving accuracy. This allows employees to focus on high-value tasks that require human input. For example, Goldman Sachs has used automation to streamline trading operations significantly.

Real-time Fraud Detection: AI helps retailers swiftly detect unusual transaction patterns indicative of fraud. It monitors complex networks in real-time to protect against data theft and loss. This capability is crucial for maintaining consumer trust and confidence in B2C sectors like retail.

Supporting Staff: AI chatbots facilitate staff onboarding and assist with queries, which is particularly beneficial in industries with high turnover rates like retail. Companies like Adidas and Walmart use AI solutions to enhance employee support and improve customer interactions.

The accessibility of AI technology to retailers of all sizes underscores its importance as a strategic tool for driving down costs and improving efficiencies across various operational areas.

AI's impact on backend systems and processes

What: John Lewis is hiring 12,500 additional staff for the Christmas period, marking its largest ever seasonal recruitment effort.

Why it is important: This recruitment drive underscores John Lewis's commitment to enhancing customer experience during its busiest trading period, reflecting increased shopper numbers and the importance of the festive season for retail.

John Lewis has announced its largest seasonal recruitment drive, hiring 12,500 additional staff to support operations during the Christmas period. This includes an extra 4,100 roles compared to last year across Waitrose, John Lewis stores, and its distribution network. The recruitment aims to bolster support during the "golden quarter," which includes Black Friday, Christmas, and the January Winter Sale. Waitrose will hire 7,700 seasonal workers for various roles in over 300 shops, while John Lewis is filling 2,000 temporary positions in its 34 stores. Additionally, 2,800 roles are available in the supply chain. Charlotte Lock, Customer Director at John Lewis Partnership, highlighted the importance of their partners in providing trusted advice and a personal touch to customers. This initiative reflects the retailer's commitment to maintaining high customer service standards amid record shopper numbers.

John Lewis launches largest seasonal recruitment drive