The Future of Australian Retail: What to Expect in 2025 and Beyond
Australia’s retail industry is stepping into a new era — one defined by cautious optimism, digital transformation, and consumers who are more value-driven than ever.
After several years of high inflation and squeezed household budgets, 2025 is shaping up as a turning point. The December trading season will be a critical test of whether Australians are ready to spend again, and how retailers adapt to a permanently reshaped landscape.
So, what is next for Aussie retail as we move into 2026? Here is what the experts at Deloitte, PwC, and Salesforce are predicting.
The Big Picture: Steady Growth, Not a Boom
According to Deloitte Access Economics, retail sales growth is expected to rise gradually with retail sales volumes are expected to grow by 2.3% in 2026. The tone is cautious but optimistic. Consumers are still being careful, yet they are not closing their wallets completely.
PwC’s Consumer Markets Outlook reports that retail sales grew 4.6 percent in mid-2025, the strongest result in two years. They also affirm steady spending growth in 2026 as cost-of-living pressures remain.
“Retailers are finally seeing some more substantial economic tailwinds, but the long-awaited retail recovery is still taking its time” says David Rumbens, Partner at Deloitte Access Economics.
While there is no major retail boom ahead, the market is stabilising. After several years of volatility, steady growth is a welcome sign.
Consumers: Searching for Value and Meaning
If one word defines today’s shopper, it is value.
PwC found that 74 percent of Australians say the cost of living is their biggest concern, and more than half feel financially insecure. This is driving a shift toward affordable, private-label brands, discount retailers, and second-hand shopping.
However, value now means more than price. Consumers want brands that align with their values. They care about sustainability, purpose, and authenticity, even when chasing a bargain. The emotional connection matters as much as the deal.
The Digital Shift: From E-commerce to Unified Commerce
The next evolution of retail is not just about selling online. It is about selling everywhere.
Salesforce’s 2025 Retail Industry Trends found that in-store purchases are expected to decline from 45 percent of all sales in 2024 to 41 percent by 2026. That does not mean stores are dying. Instead, physical locations are becoming experience hubs where customers collect online orders, try new products, and engage with brands.
The retailers that succeed in 2026 will master unified commerce. This means integrating online, mobile, social, and in-store experiences so the customer journey feels seamless from start to finish.
AI will also play a major role. Salesforce found that 75 percent of Australian retailers expect AI to be essential by 2026. Retailers are using AI to forecast demand, personalise recommendations, and automate service and support.
Sustainability and the Conscious Shopper
Sustainability has moved from a niche concern to a mainstream expectation.
While Australians care about ethical products, PwC’s research shows that two-thirds still think sustainable options are too expensive. This creates opportunity for retailers who can deliver responsible products without premium pricing.
The circular economy is also gaining traction through resale platforms, rental models, and waste-reduction programs. With mandatory sustainability reporting beginning in 2025 and 2026, the pressure on retailers to innovate responsibly will continue to grow.
What to Expect in December 2025 and Into 2026
The December 2025 trading season will focus on value. Consumers are prepared to spend on gifts, experiences, and wellness, but they will remain price sensitive on high-ticket items such as electronics and fashion. Expect promotional activity to be strong, but strategic, rather than desperate.
Looking to 2026, Deloitte expects a gradual lift in confidence as interest rates ease. PwC forecasts a slow but steady recovery in real spending. This environment gives retailers room to plan, invest, and experiment, but success will depend on smarter strategy rather than higher volume.
Retailers that stand out will:
Invest in digital and data analytics, especially AI-driven personalisation
Build flexible fulfilment and return systems
Offer accessible sustainability
Create meaningful in-store and online experiences
The Takeaway
The Australian retail sector is entering a new phase: smarter, leaner, and more human.
Growth will come from understanding customers, building trust, and delivering true value. The future of retail is not about choosing between online and offline. It is about offering convenience, connection, and credibility at every touchpoint.
As we move into 2026, the best retailers will not just adapt to change. They will define it.
