Trends in Retail and customer behaviour in 2025 and what this means for your store design
Retail is shifting fast, and 2025 is shaping up to be a big year for change. With evolving consumer expectations, new tech, and economic shifts, brands have to keep up or risk falling behind. Here are some insights on where retail is headed that we recently heard from a seminar by the Retail Doctor Group. From the growing need for real engagement to the rise of value shopping. Let’s break down the 8 biggest trends and what they mean for retailers moving forward.
1. Instant Gratification: The Age of Impatient Shoppers
Today’s shoppers—especially Millennials and Gen Z—expect things now. The acceptable wait time for a product or delivery? Just five days.
Subscription models are booming, particularly in Australia. They offer convenience and reliability, while also building long-term customer relationships. Brands that make it easy to buy and receive products instantly will win big.
What this means for store design: Brick-and-mortar stores have a huge opportunity here. If people want things fast, they’ll visit physical stores—but the experience needs to be worth their time. Stores should feel engaging and interactive, encouraging customers to stay longer, come back often, and spend more. If not, shoppers will opt for subscriptions instead.
X+O developed a new store design for Hairhouse that includes interactive zones that encourage trial and engage customers through displays, bright coloured and multi textured environments. Strategic lighting in fixtures, mirrors, ceiling engages the senses. Hairhouse Australia is the largest employer of qualified hair stylists and the home of 130+ globally loved haircare brands, with 110+ stores nationally. Click on the image to find out more.
2. Sustainable and Eco-Friendly Interiors
Sustainability is no longer an option—it’s a necessity. Conusmer expectation regarding sustainability continues to increase and is no longer a nice to have.
What this means for store design: Store design should be adopting the following principles:
Recycled and Up-cycled Specifications: Furniture, fixtures, materials and décor made from sustainable sources, such as reclaimed wood, recycled metal, and eco-friendly fabrics
Energy-Efficient Lighting and Climate Control: LED lighting, solar panels, and smart temperature control.
Minimalist and Modular Designs: Flexible layouts that reduce waste and allow for easy modifications/ re-use.
Pivot to focus on reduction, reuse, and circularity
The Pop-up repair store, for Nudie Jeans is located in Grand Indonesia (Jakarta). X+O designed this store to reflect Nudie Jeans' identity and brand values underpinned by sustainable principles. The store features Nudie Jeans' signature sewing machine located in the shopfront, showcasing 'forever repairs'. The pop up store was designed to be disassembled and relocated to the permanent store. Sticking true to the Nudie Jeans ethos or 'reuse' and repurposing and diverting the de-fit for landfill. Nudie Jeans is a Swedish denim brand, with a focus on sustainable design. Nudie Jeans repair stores are located all around the world as stand alone stores and shop in shops and pop up stores. Click on the image to find out more.
3. The Human Touch: Why Engagement Matters More Than Ever
Customers don’t just want to buy stuff—they want a connection. Younger shoppers, especially Gen Z, have less patience than ever and expect quick, meaningful interactions. They’re not waiting around for slow service or generic shopping experiences.
Retail staff need to be more than just checkout clerks. Since many shoppers do their homework online before visiting a store, employees must be knowledgeable and ready to add real value. The days of passive sales are over—staff must be product experts and personal shopping assistants all in one.
What this means for store design: Stores need to be more interactive. Digital signs and passive POS systems won’t cut it. Instead, retailers should create spaces where employees can demo products, encourage trial, and engage with customers. Think trial bars, seating areas, and testing stations to make shopping an experience, not just a transaction.
4. Customer Behaviour is evolving
Shoppers are getting smarter with their money. Many are cutting back on discretionary spending and leaning toward private-label brands, local and sustainable brands. Trust plays a huge role—people are willing to spend more on brands they trust, but they’re also quick to switch if they find better value elsewhere.
At the same time, "shoptimism" is on the rise. Even in uncertain times, people still want little feel-good purchases. Small, affordable treats are keeping spirits (and sales) up.
What this means for store design: Retailers need to build trust through clear communication in their store design. Signage and visual merchandising should reinforce why customers should choose their brand over competitors. Small add on sales at the counter and cross selling through clever VM is key to increasing basket spend.
5. The New Retail Reality- How Technology is Evolving Retail
AI is changing the way we shop. From predicting what customers want before they even know it to making searches more intuitive with voice and visual search, retail is becoming smarter.But with great data comes great responsibility. As retail media grows, brands must be transparent about how they handle customer data. Building trust is key to keeping shoppers engaged and comfortable.
What this means for store design: Large-format stores can use AI to help with in-store navigation and personalised shopping experiences via voice and visual search. The easier and more intuitive the shopping journey, the better. Though- data protection is key, customers must consent.
6. Competing with Global Giants
Big players like Temu and Amazon are making waves in new markets, drawing in millions of shoppers. For local retailers, competing with these giants means focusing on what makes them different: unique customer experiences, personalisation, and local relevance.
What this means for store design: Retailers must create immersive in-store experiences that truly connect with customers on an emotional level. Localised store designs that cater to regional preferences will stand out over cookie-cutter international chains that feel impersonal. Developing areas in the store design that allow for staff and customer conversations, demonstration and connectivity will enable a personalised approach in store.
7. Loyalty Programs That Actually Work
Loyalty programs aren’t just about discounts anymore. Personalised rewards matter. Studies show that 27% of loyalty members spend more, and 45% visit stores more often. That’s a huge opportunity for retailers.But loyalty isn’t one-size-fits-all. Some shoppers want discounts, others want exclusive experiences, and some just want to feel emotionally connected to a brand. Retailers need to create programs that cater to different customer motivations.
What this means for store design: Defined areas in store can encourage loyalty for various customer types. Flexible fixtures that move can enable events and experiences in store for loyal customer. The checkout counter is a prime spot to promote loyalty programs. Well-placed signage and visual merchandising can encourage sign-ups, but brands should also integrate these messages throughout the store—especially in areas where customers are already engaged, like fitting rooms or product demo areas.
8. Looking Ahead: Retail in 2030 and Beyond
Staying ahead of the game means knowing your customers and constantly innovating. From AI-driven pricing strategies to evolving store layouts, brands that fail to adapt risk becoming irrelevant.
What this means for store design: Retailers need to keep evolving. That means ongoing customer research, benchmarking against global trends, and making sure store experiences stay fresh and relevant. Reviewing store design regularly and constantly tweaking and improving the in store experience is crucia
Totally Workwear Australia is Australia’s largest network of workwear specialists, owned by Wesfarmers. Totally Workwear offers trade, safety, and uniform solutions, with 90 stores nationwide. We partnered with Totally Workwear to deliver a brand refresh across their network. Through customer journey mapping, benchmarking, research, persona development and extensive stakeholder engagement, we developed a new store design. This included fixture design and prototyping and developing guidelines. We then developed schematic plans and led the design for signage refresh on facades, for stores nationally. This is a great example of a retailer that is staying ahead of the game by knowing their customers and innovating in order to stay relevant. Click on the image to find out more.
Final Thoughts
Retail in 2025 is all about personalisation, convenience, and engaging in store experiences. Customers want more than just products—they want connections, value, and seamless shopping journeys. Retailers who embrace these trends and focus on customer-centric strategies will thrive in the new era of retail.
By using AI wisely, fostering emotional connections, and continuously innovating in-store experiences, brands can set themselves up for long-term success. The future of retail isn’t just about selling—it’s about engaging, adapting, and creating experiences that keep customers coming back.