InternetRetailing spoke to retail experts to find out what trends and challenges 2026 has in store for the sector.
2025 was a mixed bag for retailers; a tough economic climate and late Autumn Budget contributed to ongoing consumer uncertainty, but despite this, many major retailers including Next, Amazon and Tesco delivered strong results. One major trend was the increased use of AI by consumers and the rise of agentic shopping, a trajectory that’s expected to continue in 2026. Alongside this, retail experts predict the following…
Customers expect a blended experience
Analysts predict slow, steady growth for digital retail in 2026, and although it will still outpace physical retail, Carina Hummel, UK managing director for optics at Specsavers, believes that customers now expect a blended experience.
“Customers want to start their journey online, seek expertise in-store, and move seamlessly between the two,” she says. “Customers may start online, but they still value the reassurance, expertise and human connection that only the high street can provide. Retailers with deep community roots — and who stay closely attuned to the people they serve — will ultimately come out on top.”
Despite economic headwinds, Hummel predicts continued investment in physical retail space. “Retailers should double down on creating spaces that feel engaging, welcoming and enjoyable. When stores offer real value — not just in product, but in experience — customers return more often and spend more over time.”
Amazon and AI will be central to digital evolution
Digital commerce is evolving rapidly. Jack Tomson, chief growth officer at Trojan Group, sees structural shifts in how brands approach online growth. “More brands will move to a hybrid Amazon model, balancing 1P with 3P while investing in direct-to-consumer. It’s fast becoming the smartest way to stay visible, profitable and resilient,” he says.
Search behaviour is changing, with AI-led conversational queries replacing traditional keywords. “Brands will start rewriting product pages and FAQs so they appear when someone asks a question rather than types a short keyword,” Tomson explains.
Although AI will play a bigger role in enabling efficiency, Mark Monte-Colombo, director of seller development & brand at eBay UK, stresses that it cannot replace human trust. “AI is reshaping retail, helping retailers make faster, smarter, insight-led decisions,” he states. “But automation can only support efficiency — it’s a retailer’s identity, story and customer experience that ultimately build trust.”
“The businesses that thrive in 2026 will be those that use AI to strengthen their operations, while allowing their own voice and values to remain front and centre,” he adds.
Social commerce and retail media continue their trajectories
Social commerce is accelerating, with TikTok Shop emerging as a powerful discovery engine. “TikTok’s growth suggests it will grab an even bigger share of product discovery, driving impulse-led buys and pulling attention away from traditional search,” Tomson says. Meanwhile, retail media is becoming a dominant performance lever. “With Amazon, Tesco, Sainsbury’s and TikTok building out ad networks, retail media may soon overtake traditional trade spend,” he adds.
Closing the knowledge gap unlocks growth
For smaller retailers, the challenge is different but just as urgent: closing the digital knowledge gap. Monte-Colombo, Director of Seller Development & Brand at eBay UK, says the tools to level the playing field are already available, from advertising dashboards to AI-powered insights, but knowing where to start is often the hardest part. “Even small, consistent steps can make a meaningful difference,” he advises. “Retailers shouldn’t feel pressure to master everything at once; progress, not perfection, is what closes the gap.”
‘Always-on’ advertising builds visibility
Monte-Colombo also champions an always-on approach to advertising. “Today’s customers move fluidly between search engines, social platforms, marketplaces and shops, and in 2026 these journeys will only become more fragmented. A steady, always-on approach ensures products stay discoverable and stock continues to move. With attention spread across multiple channels, relying on short bursts of activity is no longer enough.” The payoff, he says, is cumulative: “Maintaining visibility through smart, targeted campaigns strengthens recognition, trust and loyalty over time.”
Operational resilience remains a critical backdrop
Ian Hall, CEO of CCS McLays, points to cost pressures as a defining challenge, from wage uplifts and business rates to energy costs. Retailers will continue to streamline operations and consolidate spend, while exploring more resilient product mixes and private-label options. Store refreshes and experience upgrades consistently deliver measurable uplifts. Personalisation across products, packaging and digital journeys is becoming a baseline expectation. Sustainability remains high on the agenda, but regulatory changes such as EPR and EUDR are reshaping packaging decisions, sometimes prompting a return to plastics to reduce compliance costs. Supply-chain agility is more important than ever as shipping times lengthen and tariff volatility disrupts production.
The year ahead will no doubt be challenging, but there are opportunities too. For retailers, 2026 looks like a balancing act: blending channels gracefully, showing up continuously in discovery and media, building practical digital confidence, and running lean, agile operations. From omnichannel experiences to AI-driven efficiencies, the year ahead will reward those who combine innovation with authenticity.
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