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Retail News Asia is committed to providing both local and global retailers with the latest Research throughout the Asian market. This on a daily base.

  • Over 60 per Cent of Black Friday Shoppers Pre-Plan Holiday Purchases

    Over 60 per Cent of Black Friday Shoppers Pre-Plan Holiday Purchases

    Australian retailers face a structural shift in holiday spending as 57 per cent of shoppers concentrate gift purchases in November after pre-selecting brands in October.

    Data compiled by market research agency Retail Safari and consultancy PwC shows 64 per cent of holiday budgets remain unspent entering November, even as buyers finalise purchase shortlists weeks earlier. Black Friday alone now captures 55 per cent of holiday shoppers, turning the discount window into an execution phase rather than a discovery channel.

    The Split Between Early Planning and Peak Spending

    Consumer research from Mintel indicates more than six in ten Black Friday shoppers choose their target products before promotional events begin. Shoppers use September and October to compare specifications, check customer reviews and track merchant pricing before committing funds. In Australia, research from the Australian Retailers Association and Roy Morgan showed 29 per cent of consumers started browsing earlier in 2025 than the previous year, while only 8 per cent started later.

    The US-based National Retail Federation recorded an identical baseline, with roughly 40 per cent of consumers starting holiday research before November. Shoppers cite three main drivers: managing household budgets over time, avoiding store congestion, and eliminating late delivery risks.

    Big-Ticket Sales Diverge From Headline Retail Growth

    Official figures mask underlying pressure across discretionary categories. Australian Bureau of Statistics data analyzed by investment research firm MST Marquee placed July retail turnover growth at 6.6 per cent year on year, running above the 4.9 per cent historical average. Food services rose 9.3 per cent and clothing gained 7.1 per cent, but major durable goods operators failed to capture that momentum.

    First-quarter trading updates reflect the divide. Online furniture seller Temple & Webster reported sales down 13 per cent across its first seven weeks, department store operator Myer posted a 4 per cent decline, and Accent Group recorded a 2 per cent like-for-like drop. Electronics chain JB Hi-Fi saw comparable sales slip 1.4 per cent, while its home appliance unit The Good Guys declined 1.7 per cent and furniture retailer Nick Scali tracked flat from July 1.

    Household Wealth Pressures Shorten Brand Lists

    For store operators and suppliers, the divergence means consumers are buying smaller items frequently while delaying expensive, considered purchases until deep discounting begins. Retailers that spend their marketing budgets solely on late November discounts risk losing shoppers who eliminated unfamiliar brands during the October evaluation window. Merchant margins face compounding pressure if price cuts merely settle competition among pre-selected names rather than bringing in new foot traffic.

    The shift follows a broader contraction in gift-buying participation. ARA and Roy Morgan figures showed 68 per cent of Australian adults planned holiday gift purchases last year, down 9 per cent from 2024, while average spend per remaining buyer climbed 7.1 per cent to A$757.

    MST Marquee projects household goods demand will soften further through the fourth quarter as property price weakness and potential interest rate hikes from the Reserve Bank of Australia curb discretionary outlays.

  • 91 Per Cent of Australian Consumers Switch Brands for Better Offers

    91 Per Cent of Australian Consumers Switch Brands for Better Offers

    A report by retail industry association Shop ANZ and consumer insights platform Vypr reveals that 91 per cent of Australian consumers have switched brands for a better offer.

    The study found that 79 per cent of shoppers have visited a different retailer to secure an offer, putting sustained pressure on retailers to continue promotional activity.

    According to the findings, 81 per cent of respondents said price has become a more important factor when purchasing a product than it was a year ago, making customer retention increasingly difficult.

    Promotional Cycles Drain Brand Value

    Heavier promotional spending generates short-term transaction spikes, but it fails to secure lasting customer retention once items return to full shelf price. Suppliers that fund continuous price reductions face falling margins without gaining repeat foot traffic.

    Vypr chief revenue officer Sam Gilding noted the structural weakness of relying on perpetual markdowns. “If a brand is recruiting shoppers heavily and then losing them to the next offer on shelf, it’s funding a cycle rather than building a base,” Gilding said.

    Middle-Aged Buyers Drive Shift

    Demographic data reveals acute pressure among mid-career shoppers, with 42 per cent of consumers aged 35 to 44 frequently switching brands because of a promotion. This demographic carries higher mortgage commitments and household expenses, making them faster to trade down than younger or older cohorts.

    Retailers across the Asia-Pacific region have expanded loyalty apps to protect basket sizes, yet Australian consumer behaviour suggests shoppers treat these programs as discount search engines rather than commitments to a banner. When every rival matches the discount, the retailer funding the deepest markdown simply buys temporary volume at the expense of profit.

    Shelf Pricing Faces Margin Test

    Shop ANZ general manager Carla Bridge explained that while shoppers discover promotions across apps, email catalogues, and social media feeds, purchasing decisions are still confirmed directly at the physical shelf.

    The findings follow two years of compounding inflation across Australian consumer staples, which reshaped grocery shopping habits and made weekly catalogue specials the primary driver of household spending routes.

    Packaged goods suppliers negotiating trade terms for the upcoming trading quarters now face demands from major supermarket chains to co-fund deeper price cuts to protect category volume.

  • Australian Retail Health Index Drops to Negative 1.07 as Insolvencies Rise

    Australian Retail Health Index Drops to Negative 1.07 as Insolvencies Rise

    Australian retail conditions worsened sharply in the three months ending June 2026, dragging KPMG’s Retail Health Index down to negative 1.07 from negative 0.37 in the previous quarter.

    A steep 11.4 per cent drop in consumer sentiment drove the decline, even as total household spending and producer prices recorded modest gains.

    Pressures on cash flow and demand led to 254 retail insolvencies during the three-month period. Employers pulled back hiring across store networks, cutting job vacancies by 15.3 per cent to leave 26,000 open roles across the country. The index measures spending, sentiment, turnover, pricing and underlying business performance to gauge sector viability.

    Value Hunting Alters Store Economics

    Shoppers across Australia have shifted their habits toward planned, price-sensitive purchases rather than halting expenditure entirely. Foot traffic and checkout totals increasingly concentrate around major promotional windows such as End of Financial Year sales, thinning margins for operators between events.

    For regional retail groups and brand distributors, this concentration creates sharp operational volatility. Inventory holding costs rise between discount periods, while staffing models must flex quickly to handle brief spikes in transaction volume without blowing out payroll costs.

    Digital Channels and Labour Adjustments

    Suppliers face renegotiations on wholesale terms as storefront operators fight to protect gross margins against higher input costs. Landlords in secondary shopping centres risk longer lease negotiations, particularly where specialty fashion and discretionary merchants struggle to sustain standard rent-to-sales ratios.

    The contraction follows a prolonged period of cautious buying that started when higher borrowing costs began constraining disposable income across major metropolitan centres. Earlier quarters had managed to absorb rising operational overheads through modest price adjustments, but consumer pushback against shelf prices has now limited further retail pass-through.

    Promotional Execution Takes Centre Stage

    Relief for the sector depends heavily on whether lower supply chain disruptions and sustained population growth can offset cautious household budgets. Retailers are directing investment into automated personalisation and inventory tracking systems to lift conversion rates ahead of high-volume seasonal trading.

    Merchant performance across the market now hinges on order execution during the upcoming Black Friday and Cyber Monday discounting calendar.

  • Singapore Retail Sales Growth Slows to 1.5% in July as Luxury Holds Firm

    Singapore Retail Sales Growth Slows to 1.5% in July as Luxury Holds Firm

    Singapore retail sales excluding motor vehicles rose 1.5 per cent year-on-year in July to SG$3.7 billion (US$2.9 billion), slowing from a 4.1 per cent gain in June.

    Official Department of Statistics data released on Monday showed shoppers pared back daily supermarket and fuel spending while sustaining double-digit increases on high-end discretionary items. Online transactions generated 18.3 per cent of total retail turnover during the month.

    Discretionary Spend Defies Inflation

    Recreational goods rose 13.9 per cent year-on-year, propelled by sports equipment purchases. Turnover for watches and jewellery climbed 11.1 per cent over the same period, giving both categories three consecutive months of double-digit expansion.

    Everyday retail categories faced a sharper contraction. Fuel receipts dropped 1.1 per cent in July after an 8.0 per cent expansion in June, reflecting a mid-year drop in pump prices before crude costs picked up again heading into late third-quarter trading. Supermarkets, convenience stores, mini-marts, and food and alcohol retailers all posted annual revenue declines.

    Right now, this is a market where retailers serving the masses are struggling, while those attracting the wealthy thrive.

    Josh Gilbert, lead analyst for Apac at Etoro, noted that households have adjusted their budgets around elevated living expenses by cutting routine spending to protect big-ticket purchases.

    Department Stores Squeezed

    Department stores suffered their sixth contraction in seven months. The persistent slide exposes structural problems for general merchandise retailers competing against specialized mono-brand stores on one side and cross-border e-commerce platforms on the other.

    Landlords across central shopping corridors face an increasingly split tenant base. Prime retail space dedicated to athleisure, fitness gear, and hard luxury continues to deliver higher sales densities, while suburban grocery anchors and legacy multi-brand floors yield lower turnover rents.

    Distortions and the Next Baseline

    Part of the drag on staple retail reflects a high comparative base from July 2025, when households spent state-issued SG60 vouchers across neighborhood stores and supermarkets.

    August retail numbers will reveal whether renewed oil price volatility and the complete runoff of previous fiscal stimulus further weaken food receipts, ahead of fourth-quarter lease renegotiations across major shopping mall portfolios.

  • 87% Of Australians Have AI Privacy Concerns, Report Finds

    87% Of Australians Have AI Privacy Concerns, Report Finds

    Eighty-seven per cent of Australians have concerns about privacy for artificial intelligence, according to Australian Retail Council research discussed at an industry roundtable in September 2026.

    The findings, highlighted by Diebold Nixdorf, show that only 5 per cent of Australians say they trust AI companies, presenting a live commercial risk for retailers integrating automation into everyday operations.

    Senior retail leaders at the gathering noted that while the technology for age verification, customer service, and loss prevention is ready, customer trust remains the primary barrier to adoption across Australian stores.

    Designing privacy into the checkout lane

    Automated age verification and theft detection represent the front line of store deployment. In international grocery markets, automated systems now approve most age-restricted purchases at self-checkout within seconds by processing visual data locally without retaining personal files.

    Hardware suppliers argue that keeping customer records off retail servers prevents chains from becoming targets for regulatory scrutiny. Similarly, loss prevention algorithms in newer self-checkouts prompt shoppers to scan missed items before store staff intervene, reducing confrontation at the register.

    Operating standards across store networks

    Supermarket operators across the Asia-Pacific region have accelerated camera-assisted checkout rollouts over the past three years to curb inventory shrink. Australian grocers that run uncoordinated systems across point-of-sale, payments, and security cameras risk alienating shoppers if privacy safeguards vary between store departments.

    For regional retail executives, deploying store AI without clear boundaries creates legal and operational liabilities. While Asian retailers in markets such as Singapore and Japan have integrated automated kiosks with high public compliance, Australian consumers push back when surveillance feels unchecked.

    Industry proposals for shared rules

    The push toward automation follows earlier disputes between major Australian supermarket chains and privacy regulators over facial recognition testing in retail aisles. Industry participants at the roundtable raised support for a retail-specific AI code of practice to set standard data retention limits across the sector.

    Diebold Nixdorf published the findings alongside its research report on self-service systems in Australia. Retailers now weigh whether to adopt voluntary operating rules or wait for formal regulatory guidelines on customer data capture at the till.

  • World Bank Urges Thailand to Lift 12% AI Adoption Rate for 2037 Goal

    World Bank Urges Thailand to Lift 12% AI Adoption Rate for 2037 Goal

    Thailand must lift its corporate artificial intelligence adoption beyond the current 12 per cent rate to hit high-income status by 2037, according to the World Bank.

    Only about one in eight Thai businesses currently deploys AI tools, despite recent data centre investments and an established electronics manufacturing base. Speaking at the Bangkok Business Summit, World Bank vice-president for East Asia and Pacific Carlos Felipe Jaramillo warned that commercial adoption remains too concentrated among large corporations in the capital.

    Closing the SME technology gap

    Small, medium and micro-enterprises outside Bangkok account for the bulk of employment but lag in digital capabilities. The multilateral lender presented its “Building Thailand’s Future Today” report at the summit, hosted by the Joint Standing Committee on Commerce, Industry and Banking, setting out reforms for enterprise competitiveness.

    Thailand spends roughly 1 per cent of gross domestic product on research and development. Across the East Asia-Pacific region, that average sits at 2.5 per cent. World Bank senior economist Katherine Stapleton said closing that divide requires redirecting state R&D incentives toward smaller firms rather than limiting innovation programmes to top-tier conglomerates.

    RetailNews Asia notes that enterprise technology providers across Southeast Asia face a similar bottleneck: high digital consumer penetration alongside sluggish software uptake inside merchant supply chains. While Bangkok ranks among the region’s most connected consumer markets, commercial software integration across provincial retail and logistics networks remains sparse.

    Raising growth targets

    Meeting the government’s 2037 high-income target will require annual real GDP growth to jump to 5.4 per cent per person. Thai economic expansion has averaged 2.2 per cent per person since the pandemic.

    Exports generate roughly 70 per cent of Thailand’s gross domestic product, yet foreign direct investment continues to generate weak spillover gains for local suppliers. The World Bank argues that upgrading domestic software capabilities and fostering regional commercial hubs will determine whether the economy escapes middle-income stagnation.

    The Joint Standing Committee and state planning agencies are now reviewing corporate tax breaks and startup development programmes ahead of the next fiscal policy cycle.

  • Japan Retail Sales Rise 4.0% in July as Department Stores Beat Formats

    Japan Retail Sales Rise 4.0% in July as Department Stores Beat Formats

    Japan’s retail sales rose 4.0 per cent year on year in July, driven by vehicle demand and strong department store receipts. Data released on August 31 by the Ministry of Economy, Trade and Industry (METI) showed department stores expanded 4.3 per cent, outperforming convenience stores at 1.3 per cent and supermarkets at 0.8 per cent.

    Wholesale sales across the country climbed 9.0 per cent over the same period, pointing to steady business-to-business inventory movement alongside consumer channels.

    Autos and Machinery Lift Totals

    Gains varied sharply by product line. Motor vehicle retail jumped 16.2 per cent year on year, delivering the fastest expansion among all retail sectors tracked by METI. Machinery and equipment retail climbed 6.3 per cent, while general merchandise sales rose 3.1 per cent and medical and cosmetics retail gained 1.6 per cent. Fuel retail turnover remained flat.

    Apparel and textile retail dropped 6.6 per cent year on year. That was the steepest contraction in the survey and the only major retail category to decline in July.

    Department Stores Lean on Inbound Spend

    The gap between falling clothing sales and rising department store receipts reveals a split in consumer behavior. Department store operators historically rely on apparel for a large share of their floor space, yet their revenue expanded while domestic clothing retail contracted. Tax-free transactions, luxury goods, and jewellery purchases by foreign visitors filled the shortfall left by cautious local fashion shoppers.

    Department stores across East and Southeast Asia have navigated similar pressures, leaning into high-margin luxury concessions and tourist footfall to offset sluggish domestic volume in apparel. For Japanese operators, sustained gains now tie closely to exchange-rate levels and international passenger arrivals rather than domestic wage spending.

    METI will publish its finalized July commerce figures in mid-September, with retail watchers monitoring whether vehicle order backlogs and inbound tourist spending hold up through late summer.

  • Ghost Month Slows Philippine Property Deals and Major Consumer Purchases

    Ghost Month Slows Philippine Property Deals and Major Consumer Purchases

    Philippine consumers are postponing major property purchases and business launches until Ghost Month ends. That pushes transaction volumes into the fourth quarter.

    The seventh lunar month prompts households across the country to delay home handovers, wedding bookings, and commercial openings. Sales inquiries continue. However, buyers hold off on signing binding contracts or moving into finished properties.

    How Cultural Timing Alters Buying Cycles

    This pattern stems from Chinese traditions of ancestor remembrance that remain influential across Southeast Asian commercial centers. Families view big financial commitments as major life transitions. Avoiding perceived risk carries more weight than closing a deal early.

    For retailers and property developers, the slowdown represents delayed demand rather than lost sales. Companies frequently realign marketing budgets and inventory releases. This prevents spending during weeks when buyers intentionally freeze final decisions.

    Aligning Sales Plans with Seasonal Shifts

    Cultural calendars dictate revenue spikes and lulls across other Asian retail sectors as well. Brands routinely adjust operations around the Lunar New Year gift cycle, Ramadan shopping windows, and Christmas retail surges.

    Strategists Josiah Go and Chiqui Escareal-Go will outline consumer decision frameworks for regional operators at the 3rd Marketing Plan Summit on Sept. 22 and 23, focusing on the commercial impact of behavioral timing.

  • Video Commerce Captures 20 per Cent of Southeast Asia E-Commerce GMV

    Video Commerce Captures 20 per Cent of Southeast Asia E-Commerce GMV

    Video commerce now accounts for roughly a fifth of Southeast Asian e-commerce gross merchandise value, forcing consumer brands across the region to overhaul their distribution models. Data compiled by Google, Temasek and Bain shows creator-led sales shifting from experimental promotional spending into core retail infrastructure across key markets including Indonesia, Thailand and Vietnam.

    That expansion brings operational friction. Sellers running live broadcasts face steep drops between top-line gross merchandise value and realized revenue once cash-on-delivery refusals, return windows, creator fees and platform commissions clear. Promotional subsidies, including platform-funded vouchers and discounted freight, have masked true channel margins during market-share acquisition phases. When platforms pull back subsidies, merchant unit economics drop quickly.

    Platform control and merchant margin pressure

    Selling through creator streams leaves transaction infrastructure in third-party hands. Platforms control storefronts, checkout systems, payment rails, customer records, delivery terms and dispute resolution, leaving brands to supply inventory and absorb product returns.

    Multi-market operators managing sales across Jakarta, Bangkok and Manila face diverging compliance environments. Content licensing, creator contracts, disclosure mandates and withholding taxes vary by jurisdiction, preventing companies from running uniform regional campaigns without local adaptation.

    The pattern follows China’s live commerce cycle. Brands in that market initially concentrated volume through top independent hosts before margins deteriorated. Chinese consumer labels responded by building internal broadcast studios and running scheduled daily programming to retain customer data and protect gross margins.

    Regulatory scrutiny reshapes regional operations

    Governments across Southeast Asia have moved to regulate social commerce platforms as critical retail infrastructure rather than digital advertising channels. Indonesia enacted Ministry of Trade Regulation 31 in September 2023, banning direct e-commerce transactions inside social media applications. The rule halted TikTok Shop until parent company ByteDance completed a 1.5 billion dollar investment to secure a controlling stake in GoTo’s Tokopedia platform.

    Vietnam enacted Decree 147 in late December 2024, enforcing strict account verification requirements before individuals can post or host livestreams. Merchant operators are now building direct customer channels, internal studio facilities and formal data-rights clauses into creator agreements across tier-two Vietnamese cities and eastern Indonesia, where production overhead remains competitive.

    Retailers across the region now track net settlement data and return rates per stream as platforms adjust commercial take rates and enforcement rules throughout 2026.

  • Australian Shoppers Trust AI Recommendations over In-Store Retail Staff

    Australian Shoppers Trust AI Recommendations over In-Store Retail Staff

    Australian consumers now place more trust in artificial intelligence for shopping recommendations than in human retail staff, according to new industry research tracking store-floor buyer habits.

    The findings point to a decisive shift in how shoppers research products, compare prices, and finalize purchasing decisions across Australian retail channels.

    The shift away from floor staff

    Shoppers increasingly turn to automated search assistants, chatbot tools, and algorithm-driven recommendation engines before speaking to floor employees. Fast access to product specifications, unvarnished peer reviews, and real-time inventory checks gives digital tools an edge over human staff who may lack deep product knowledge.

    Retail workers face higher shopper expectations as a result. Store visitors often arrive having already researched technical details online, using physical visits primarily to confirm choices rather than seek basic sales guidance.

    What the preference change means for store networks

    Across the Asia-Pacific region, merchants in mature retail markets like Australia, Japan, and Singapore are reallocating technology budgets to support instant customer queries at the shelf edge. Retailers that integrate generative assistants into loyalty apps and in-store digital kiosks capture buyer intent earlier in the shopping cycle.

    Store operators must now decide how to retrain frontline staff to handle complex customer service issues rather than standard product lookup tasks.

  • Australian Retail Profit Lags Sales as Hidden Operating Costs Bite Margins

    Australian Retail Profit Lags Sales as Hidden Operating Costs Bite Margins

    Australian retail sales rose 2.8 per cent in the 2024-25 financial year, but operating profit before tax grew just 1.5 per cent to $38.8 billion as margin pressure intensified.

    Data from KPMG’s Retail Health Index shows that gap widening further into 2026, forcing boards to rethink conventional cost cutting.

    Retailers confronting squeezed margins often reduce store staff hours and trim marketing budgets. Advisory firm Olvera Advisors found these immediate cuts routinely fail to stop profitability leaks, which sit deeper in inventory management, returns handling and supplier contracts.

    Holding Costs and Inventory Drag

    Aged stock sitting in warehouses past 90 days creates an unmeasured drag on working capital. Benchmarking from APQC puts median inventory carrying costs at 10 per cent of value each year. A business holding $5 million in aged stock absorbs $500,000 annually in holding expenses before accounting for final clearance markdowns.

    Supplier renegotiations also remain narrowly focused on unit pricing rather than structural terms. Data from the Payment Times Reporting Regulator shows average retail payment terms at 31 days, though the 95th percentile extends to 77 days. Rebate structures frequently remain poorly tracked at the executive level, echoing findings from the Australian Competition and Consumer Commission’s supermarket inquiry.

    The Multi-Channel Fulfilment Trap

    E-commerce fulfilment and customer returns represent another growing source of unallocated operational losses. Total costs for a single product return average roughly $47 on an $80 basket, factoring in $20.78 for two-way freight, $10 in handling and an average $16 markdown. For a merchant processing one million orders annually, each single percentage point in return rate drains approximately $470,000.

    Similar accounting oversights previously hit Australia’s largest conglomerates. Woolworths paid $217.4 million for an 80 per cent stake in marketplace MyDeal in 2022 before shutting it in 2025 at a cash cost between $90 million and $100 million, alongside a $45 million impairment charge. Rival Wesfarmers similarly wound down its Catch marketplace after channel-level operating costs outpaced unit economics.

    Retail operators now face pressure from commercial lenders to present granular reporting on stock ageing past 90 days, net channel profitability and full-year return costs ahead of the next seasonal markdown cycle.

  • Global Carton Tape Demand to Grow up to 6 Percent Annually Through 2035

    Global Carton Tape Demand to Grow up to 6 Percent Annually Through 2035

    Global demand for clear polypropylene carton tape will expand by 4 to 6 percent annually through 2035 as e-commerce fulfillment and regional trade drive carton sealing volumes across major markets. Online retail parcels now account for 35 to 45 percent of worldwide consumption, with China supplying approximately two-fifths of total volume through export channels.

    Coated biaxially oriented polypropylene film with acrylic or hot-melt adhesives remains the dominant sealing choice for corrugated cardboard boxes across automated warehouse systems. Retail platforms including Amazon and Alibaba have expanded individual parcel shipments, while product returns create recurring re-packaging cycles that reinforce baseline tape use.

    Feedstock Pressures and Production Shifts

    Manufacturing footprints are adjusting to feedstock availability. Output capacity is migrating toward Southeast Asia and the Middle East, where raw polypropylene film supplies are more accessible. Polypropylene feedstock represents 55 to 65 percent of total manufacturing expenses, leaving standard tape margins exposed to raw material price swings.

    Cross-border distribution also faces trade friction. Import tariffs on finished tape currently range from 5 to 15 percent depending on the jurisdiction and existing bilateral pacts. Standard commodity tape remains highly price-sensitive, prompting large fulfillment operators to switch suppliers frequently to protect packing margins.

    Private Label and Specialty Growth

    Large retailers and third-party logistics operators are turning to contract manufacturing to secure supply. Private-label formats now make up 20 to 30 percent of global volume, giving logistics groups tighter cost control over warehouse consumables.

    Specialty formats are outpacing standard stock. High-adhesion variants, reduced-plastic rolls with 15 to 25 percent thinner gauges, and low-noise unwind tapes are expanding at 7 to 10 percent annually. Foodservice and institutional packaging represent another 20 to 25 percent of demand, where strict food-contact compliance and low-odor formulations command higher pricing from delivery platforms and catering operators.

    Industrial packaging buyers are also testing paper and water-activated tape alternatives to meet corporate plastic reduction targets, though synthetic polypropylene films retain the cost advantage on automated packing lines. Market indicators project the global tape index to reach between 145 and 160 by 2035 against a 2025 baseline.

  • AI Retail Assistant Spending to Reach USD 22.4 Billion by 2036

    AI Retail Assistant Spending to Reach USD 22.4 Billion by 2036

    Global retail spending on artificial intelligence assistants will expand from USD 2.4 billion in 2026 to USD 22.4 billion by 2036, according to industry data from Fact.MR. The projected 25.0 per cent annual growth rate adds USD 20 billion in total market value over the decade, lifted from a baseline of USD 1.9 billion recorded in 2025.

    Asian retail markets represent two of the primary growth corridors over the forecast period. South Korea will expand at a 25.9 per cent compound annual rate through 2036, driven by high mobile commerce penetration and dense transaction pools inside native retail apps. Japan is projected to grow at 21.0 per cent annually, propelled by chain store operators adopting automated multilingual customer support and digital floor guidance.

    Cloud Platforms and Inventory Signals Dominate Spend

    Software platforms will account for 41.0 per cent of all retail assistant expenditure in 2026. Retailers are selecting single-platform layers to handle catalog search, guided selling journeys, and customer service escalation rather than buying point solutions.

    Cloud infrastructure will capture 51.0 per cent of deployments this year, giving store networks centralized access to generative models without the expense of hosting separate environments for each brand format. Large enterprises will generate 42.0 per cent of overall market demand, backed by dedicated governance teams and complex multi-channel data operations.

    Assistant capabilities are also shifting away from basic conversational bots toward merchandise planning. Forecasting tools will take 44.0 per cent of segment demand in 2026. Merchandising desks are connecting online search patterns with replenishment schedules to adjust inventory before store shortages occur.

    Integration Obstacles and Enterprise Rollouts

    The speed of commercial adoption faces technical friction across legacy systems. Data quality issues across fragmented product catalogs will shave an estimated 0.8 percentage points off market expansion, while internal governance reviews and legacy software integrations remain the primary bottlenecks for department store and hypermarket chains.

    Global technology providers have stepped up rollouts to meet store demand. Google Cloud launched its Conversational Commerce agent on Vertex AI in September 2025, while Microsoft introduced automated brand agents for Shopify and Copilot Studio templates in January 2026.

    The critical operational test for Asian retail operators through 2027 will center on catalog hygiene and real-time inventory synchronization across physical stores and marketplace channels.

  • China and India Lead Global Quick Commerce with Adoption Past 80 per Cent

    China and India Lead Global Quick Commerce with Adoption Past 80 per Cent

    Quick commerce adoption in China reached 83 per cent and 82 per cent in India, creating a multi-trillion-yuan grocery delivery market that outpaces Western peers. The channel is on track to surpass 1 trillion yuan in China this year, backed by a logistics network that handled 199 billion parcels in 2025.

    Data compiled by consumer intelligence firm NIQ shows ultra-fast delivery has become standard consumer behavior across major Asian economies. The global average adoption rate sits at 48 per cent, dragged down by Western markets where 34 per cent of European shoppers and only 3 per cent of North American consumers use quick commerce platforms.

    India Builds Dark Store Networks

    India represents the fastest-accelerating market for ultra-fast delivery. The sector grew 68 per cent year over year in the fourth quarter of 2025, powered by operators expanding an urban dark-store network projected to exceed 5,000 facilities. Individual micro-fulfillment hubs in the country now process up to 1,800 transactions per day.

    Shoppers in India are also changing how they use the apps. Instead of relying on 10-minute delivery purely for emergency top-ups and late-night snacks, consumers are migrating toward full grocery baskets, driving higher repeat purchase frequencies and larger ticket sizes.

    The structural divergence between Asia and the West comes down to city density, cheap local couriers, and deeply entrenched super-app ecosystems. In China and India, retail platforms solved local delivery economics early by pairing dark stores with dense residential zoning, whereas Western operators struggled with high labor overheads and sprawling suburban delivery routes that broke unit economics after 2022.

    Profitability Lags Channel Expansion

    Surging transaction volumes do not guarantee profitable sales for consumer brands selling through rapid channels. While brand manufacturers allocate an average of 27.4 per cent of their marketing spend to social commerce and related rapid channels, 58 per cent still report a return on investment of less than $1 per dollar spent.

    Growth is accelerating, but sustainable value will come from understanding which consumer missions truly benefit from immediacy.

    Suppliers are now overhauling their inventory allocations to defend margins. The key metric to watch across Asian platforms this year is whether operators can push average order values high enough to offset rising fulfillment costs as dark store networks reach saturation in tier-one cities.

  • Human Connection Remains Key Driver for Purchases in Southeast Asia Retail, Despite AI Growth

    Human Connection Remains Key Driver for Purchases in Southeast Asia Retail, Despite AI Growth

    Personal trust remains the most significant driver for consumer purchases across Southeast Asia’s US$219 billion market, even as artificial intelligence technologies become more prevalent. This human element is proving more influential than advanced technology in motivating buying decisions.

    Retailers and brands operating in the region are observing that customers prioritise relationships and reliable advice. This trend highlights the need for businesses to balance technological integration with strategies that foster genuine human connection and build consumer confidence.

    Trusting Human Connections

    Consumers in Southeast Asia are more likely to make a purchase when they have confidence in the people or businesses they interact with. This human-centric approach to commerce means that recommendations from trusted individuals, word-of-mouth, and established brand loyalty, often built through personal experiences, hold substantial weight. Businesses cannot solely rely on algorithmic recommendations or automated services to secure sales.

    RetailNews Asia regularly tracks how consumer behaviour in this diverse region is shaped by cultural nuances and evolving market dynamics. This focus on human trust mirrors similar findings in other Asian markets, where authentic engagement often translates into stronger customer retention and higher transaction values.

    Balancing AI With Personal Touch

    For retailers, the challenge lies in effectively integrating AI and other digital tools without eroding the trust built through human interaction. While AI can enhance efficiency, personalise experiences, and streamline operations, it should complement, rather than replace, the personal touch. Strategies might include using AI to free up staff for more meaningful customer engagements or to provide data-driven insights that help build better human relationships.

    The US$219 billion market in Southeast Asia is dynamic, with consumers increasingly sophisticated in their choices. Companies that successfully combine the convenience and intelligence of AI with the irreplaceable value of human connection are better positioned for sustained growth in this competitive landscape.