Tag: Mean Business

AI already has affected shopping habits for large numbers of consumers, and its ability to make hyper-personalized product recommendations — and also to find the best prices and deals — will continue to accelerate the technology’s use. According to Salesforce, during the 2025 holiday season AI will drive $260 billion in global online sales as well as $1.6 trillion in in-store sales.

Salesforce’s Caila Schwartz, Director of Consumer Insights and Strategy, shared other key predictions for the coming holiday season, including:

• Consumers cutting back and seeking value: One in three U.S. shoppers report buying less than usual over the past six months, and 55% are prioritizing essentials, with 70% trading down for lower-priced goods;
• AI has become part of gift-giving processes: 39% of shoppers use AI-powered search at some point in their shopping journey, and 39% of millennials and Gen Z consumers use AI search in-store. Among those using AI in the U.S., more than half (58%) plan to use AI for gift inspiration;
• Resale will benefit from uncertainty over tariffs and international sourcing challenges: In the U.S., 21% of consumers say they’ll seek out secondhand items due to tariff-induced price increases or shortages, and more than twice as many — 47% — say they are likely to gift a resale item this holiday season. Overall, Salesforce forecasts that $64 billion in holiday sales will be resale; and
• Gen Z likes in-person shopping: Three in four Gen Z shoppers plan to shop in-store at some point during the holiday season, with 56% daring to brave the crowds on Black Friday (along with 55% of millennials). For every $1 Gen Z shoppers spend online, Salesforce predicts they will spend $3 more in-store.

Despite Uncertain Economic Conditions, Many Consumers Remain Optimistic

“This year, there’s a tough economic reality for consumers: a high cost of living and high interest rates,” said Schwartz during a conference call discussing the results. “Additionally, supply chain challenges, exacerbated by tariffs, are creating more uncertainty for both retailers and shoppers. Consumers are confused about what it will mean in terms of both pricing and availability: Are shelves going to be stocked with what they want, when they want it?”

While there’s certainly evidence that consumers are tightening their belts, with 55% prioritizing essentials, a surprisingly large number — 41% — of U.S. consumers are optimistic about the current economic climate, compared to 38% in 2024.

“Both U.S. and global consumers say they’re going back to spending, especially for big events like Amazon Prime Day or the holiday season,” said Schwartz. “In 2024, the focus was on savings and paying down credit card debt as people tried to get their financial house in order, but in 2025, they’ll be spending on physical goods — although value will continue to be important.”

AI Shopper Use Cases Continue to Multiply

Salesforce data indicates that 5% of all shoppers now start their product search with AI chat assistants such as ChatGPT, Perplexity and Grok. Among Gen Z consumers, that number is 10%. Perhaps even more important, 44% of U.S. shoppers trust AI recommendations — a remarkably high number for a relatively new set of technologies.

In the U.S., the top reason consumers use AI search is to help them compare prices and find the best deals. The number two reason is that these AI tools give the best personalized product recommendations, and third, consumers appreciate AI’s ability to use photos, videos or audio to search.

“These tools are no longer just helpful add-ons or meme-makers, they’re becoming the bridge between customers and brands, powering a new era of hyper-personalized, real-time shopping experiences,” Schwartz wrote in a recent blog post.

To best position themselves, Schwartz recommended that retailers “evaluate where you’d like your brand to show up when it comes to AI chat assistants. As the chat assistants get more popular, customers will come to expect this kind of personalized one-on-one shopping experience. Drive conversions and loyalty with a guided shopping agent on your own site that guides shoppers through discovery and provides personalized product recommendations.”

Secondhand Becoming Shoppers’ First Choice

It’s not just potentially higher prices for new items that have many consumers turning to secondhand (17% of consumers are shopping resale to combat tariff volatility); it’s also the fear that tariffs and other supply chain challenges will lead to product shortages during the holiday crunch.

For those products that are available, tariffs will eat away at retailers’ margins if they can’t (or won’t) pass along price increases to the consumer. The squeeze on margins also means fewer discounts and promotions during the holiday season: Salesforce predicts that 2% fewer orders this holiday season will transact with a promotional code compared to 2024.

The majority of consumers that buy secondhand are doing so for economic reasons: 68% say gifting resale helps them save money, while 35% say it promotes sustainability and reduces waste.

Gen Z Likes Shopping in Stores — Especially on Black Friday

Gen Z isn’t alone in liking the benefits of in-store shopping: 79% of all holiday shoppers will visit a brick-and-mortar store at some point during the holiday season. “In fact, on the most important shopping days of the year shoppers prefer the store,” Schwartz wrote. “51% of shoppers report that they still prefer to shop in-store on Black Friday, up from 31% in 2024. Gen Z is leading that trend with an incredible 65% reporting their in-store preference for the major deal event.”

Among Gen Z, 72% identified the ability to get products immediately as their top reason for in-store shopping, with 42% expressing their appreciation for being able to touch and feel the merchandise prior to purchase, and 28% reporting that it’s easier for them to browse and discover new products in-store.

This doesn’t mean, of course, that retailers and brands can ignore digital commerce; in fact, quite the opposite. “While the youngest shoppers prefer to shop in-store, they are the most likely to be discovering and researching across many digital channels,” Schwartz wrote, noting that the average shopping journey now has nine touch points prior to a purchase. “Enable your audience to shop your brand, not your channels, by having a robust omnichannel strategy. This is not just an advantage, but a necessity to cultivate loyalty and capture market share.”

Sometimes a store is just a store…and sometimes it’s a lot more. MAC Cosmetics’ newly redesigned flagship at the Deji Plaza luxury shopping center in Nanjing, China definitely falls into the latter category.

Reopened just in time to celebrate the 20^th anniversary of the brand’s entrance into China, the store now features a visually stunning, futuristic design meant not just to stop shoppers in their tracks (although it will certainly do that), but also to reflect the evolution of the brand and its customers.

“With every detail, we’ve aimed to meet the next generation of consumers with experiences that blend high-performance artistry, immersive storytelling and creative freedom,” said Aïda Moudachirou-Rébois, SVP and Global General Manager at MAC Cosmetics in an interview with Retail TouchPoints.

“China is one of MAC’s largest and most influential international markets, and its impact on the global beauty industry is undeniable,” she added. “Chinese consumers are incredibly trend-savvy, expressive and digitally engaged — what resonates in China often sets the tone for what’s next in beauty. And as the market has evolved, so has MAC. We’ve embraced livestreaming, developed Asia-specific complexion shades tailored to local undertones and invested in immersive retail experiences that bring our artistry to life.”

The new flagship in Nanjing is a bold example of that evolution, brought to life by celebrated Chinese architect Li Xiang and her firm X+ Living.

“A brand’s flagship store should never be just a place to sell products. Its true purpose lies in creating a tangible, physical space where people can connect with the brand — without needing words. Space itself becomes a language,” said Li in an interview with Retail TouchPoints. “MAC is a brand with intense emotional tension. It doesn’t shy away from sharpness, individuality or boldness. What I hoped to create was a spatial aura that people could immediately feel the moment they stepped inside — a presence that embodies MAC’s core: its avant-garde spirit, creative energy and unapologetic self-expression. What this store presents is not just a collection of products — it’s a statement of MAC’s vision of beauty.”

That vision is already drawing in customers and paying dividends for the brand. Foot traffic at the store more than doubled from benchmark levels during the location’s soft opening, which took place June 13-22. Not only that, but sales increased 34% and new customer acquisition was up a whopping 65%.

Moudachirou-Rébois and Li took Retail TouchPoints inside the aesthetic inspiration and strategic philosophy that led to the company’s lyrical new concept store.

A Futuristic ‘Distillation’ of the MAC Brand

Nostalgic references are the flavor du jour in many design circles, but for the MAC flagship Li said she had “no intention of following the mainstream trend toward retro sentimentality,” noting that far from being rooted in nostalgia, MAC is a brand with its eye to the future.

“To me, design is not about excessive addition, but about distillation — refining the brand’s existing visual language, product symbols and cultural meanings into an environment that feels immersive and experiential,” explained Li.

Music’s Dimensionality Provides Store Inspiration

For MAC, Li leaned into a futuristic vibe with metallic textures and mechanical deconstructions to create a store that exudes “force and cultural posture.” But to do it right, she had to find an entry point into the brand’s spirit. For Li, that ended up being a piano.     

“Most art forms exist in two-dimensional space. Music is one of the few that fills and moves through three dimensions; it can’t be seen — it flows, penetrates and refuses to be confined,” explained Li. “That very nature, to me, makes music the perfect metaphor for MAC’s identity. MAC has always stood for diversity, boldness and breaking boundaries — and music carries that same tension.

“So the next challenge was, ‘How do I translate music into spatial language?’ I began with the anatomy of instruments — dissecting their structures and reinterpreting them architecturally. The piano in particular stands out: It is architecturally intricate in its inner workings, while also culturally loaded with elegance and universal recognition.”

And that is the nugget that became MAC’s Nanjing flagship. Inspired by the anatomy of a deconstructed grand piano, the space transforms MAC’s most iconic products into architectural instruments: lipsticks as black keys, palettes as tuning knobs and a sculptural ceiling that mirrors the inside of a stringed instrument. 

Visitors are greeted at the entrance with an installation that interprets the form of a grand piano through MAC products, with a piano lid and body that resemble an open compact. When pressed, the piano’s black lipstick keys play real notes.

“We embraced a concept that turns the structure of a grand piano into an immersive, emotionally expressive beauty experience — one that places artistry, exploration and individuality at the center,” explained Moudachirou-Rébois. “This flagship is a love letter to the Chinese consumer — one of the most expressive, sophisticated and creatively engaged beauty communities in the world.”

An Invitation to Not Just See, but Step into the MAC Brand

This ethos continues throughout the store. While the entrance is more conceptual, as customers move deeper into the space, the design becomes more subtle, focused on experience and even laced with humor, said Li.

Every detail in the store is engineered for the beauty disruptor: AR-powered try-on mirrors, co-creation stations to remix looks in real time, masterclass spaces and signature services tailored to local beauty rituals.

“In an ideal commercial space, every functional element should be embedded within a unified aesthetic concept — and every artistic expression should naturally serve the act of use itself,” said Li. “[For example], the makeup area, though limited in size, achieves high flexibility through a combination of foldable makeup tables, hinged mirror cabinets and stowable chairs. This transformable structure supports a wide range of uses — from daily makeup trials to tutorials and photo shoots.”

Another example is the store’s “gifting zone,” where MAC’s classic packaging served as the inspiration for the area’s structure and aesthetic.

“I hope that in such a space, consumers not only ‘see’ MAC but also ‘step into’ MAC,” said Li.

New Series of MAC Flagships to Serve as Experience Testing Grounds

The Nanjing store is the first of several upcoming bespoke flagships that MAC is planning to introduce in key markets, each intended to “surprise and delight consumers with immersive brand experiences that reinforce our pillars of artistry, community and innovation,” said Moudachirou-Rébois.

These flagships also will serve as testing grounds for ideas that the company may eventually scale across its global network. In fact, several new initiatives are being piloted at the Nanjing store, such as an enhanced gifting program that lets customers personalize products through engraving and customized packaging, with store-exclusive bags, ribbons and charms that are inspired by the specific locale.  

“Looking ahead, we’re focused on deepening our cultural connection with the Chinese consumer through partnerships with locally relevant talent like Jolin Tsai, our rock-steady backstage presence at Shanghai Fashion Week and our annual Chinese New Year collections,” Moudachirou-Rébois added. “We also look forward to introducing some groundbreaking new product innovations in the months to come, all thoughtfully designed with the Chinese consumer in mind.”

And in the meantime, the company hopes that customers have a ball at the new store. “The power of beauty lies not only in being seen, but in being felt,” said Li. “Visual stimulation works through intuition, but it can provoke deep psychological responses — perhaps a sense of ease from feeling understood, an impulse to express oneself or a moment of recognition and affirmation of one’s identity. Beauty is a mechanism of awakening — it reconnects people with their own emotions.

“That’s why, when I encountered this project and the MAC brand, I felt an instinctive sense of alignment,” she added. “MAC’s advocacy of ‘beauty for everyone’ and ‘unbounded self-expression’ deeply resonates with the spirit of design itself. Neither design nor a brand like MAC is about creating a standardized image of beauty — we are both engaged in expressing an attitude, a philosophy, a right to self-identification and freedom of choice. To me, that is the true power of beauty.”

As private labels and store brands have evolved over the last decade, the stigma of the “cheap, alternative, knockoff” brand has worn away. Retailers have built bona fide brands, touching all categories of the store. But what is interesting of late is that private brands have seemingly climbed another rung on the ladder of credibility and are now sought-after brands that consumers trust.

NielsenIQ (NIQ) data finds consumer sentiments around private labels are adding up to retailers’ owned brands being destination drivers and competing for loyalty against national brand counterparts. Sales are up for private brands and so is consumer demand. As global tariffs fluctuate and potential price increases loom, store brands could be set for more success.

In Retailers Consumers Trust

To be fair, part of the success of store brands can be attributed to retailers and grocers earning more loyalty and respect from the consumers they serve. It’s a natural connection — if a consumer loves a retailer, they’ll likely love their owned brand products.

At the same time, these products need to be good, and retailers have done a tremendous job answering that call. Target, Dollar Tree, CVS and many others have built multi-million- and billion-dollar store brands. Aldi continues to roll out more stores as their private brand-dominant approach continues to attract consumers too.

There’s trust in a retailer’s name and therefore their products. NIQ’s 2025 Private Label & Branded Products Report found that six in 10 consumers say they trust private brands because they’re endorsed by the retailer. By demographic, the data revealed this is especially true among millennials and Gen Z shoppers.

Additionally, the research discovered that nearly half of U.S. consumers said they’re buying more store brands than ever before and sales are growing faster than national brands, including:

• Private label sales grew 4.1% year-over-year, outpacing growth for national counterparts.
• Nearly three-fourths of consumers now view private labels as strong alternatives to national brands.
• Six in 10 said they’d buy more private brands if more were available.

As consumers grow more confident in private labels, and retailers earn their trust with high-quality products, the relationship could heighten between owned brands and consumers. NIQ’s private label report also found that, in general, 62% of U.S. consumers rely on buying the same brands they know and trust — and that could be more private brands over time.

Tariffs, Price Hikes Could Power Private Brands Further

Interestingly, as tariffs continue to disrupt the retail industry, potentially driving higher product prices and out of stocks, national brands could be in for a greater challenge from store brands.

For instance, NIQ data discovered that name brands overall are sold at a 19% higher average price point than private labels. Broken down by category, these price increases range dramatically:

• National brand frozen foods are only around 2% higher by average unit price
• Healthcare, home care, and paper products each see an increase in average unit price by around 40%
• Health and beauty name brands have an average unit price increase that’s 60% higher than store brands.

With some of these disparities, if consumers feel financial pressure, they may turn to more owned brands. However, just as national brands face potential issues around inventory, retailers also will need to ensure their private brands are on shelves. Consumers, loyal to a private brand or national brand, aren’t going to be happy if their favorite items aren’t in stock or stuck on ships at sea.

Taking a closer look at tariffs, NIQ research found that nearly 73% of consumers believe tariffs will impact the cost of the groceries they buy. Additionally, grocery and produce departments face significant impacts, with $15.2 billion and $6.7 billion in imported sales from Canada and Mexico, respectively.

Another category of note: non-alcoholic beverage prices already have increased in price by 30% in the last four years, and tariffs could generate a 26% increase in aluminum products prices and a 56% increase in plastics. Consider that 45% of soft drinks are sold in aluminum packages, and consumers could see a price surge.

The uncertainty of the current landscape could pressure consumers and their brand loyalties in new ways.

Store Brands 2.0

How consumers view store brands has shifted dramatically, and that relationship will only strengthen as retailers continue to expand their private label offerings. Certainly, if retailers struggle to keep products in stock or are forced to raise prices of products higher than expected, they could lose some of the newfound loyalty they’ve gained.

However, if owned brands are able to keep their price points consistently lower, as they have been, retailers might take advantage of the macroeconomic trends and drive store brand success higher. Frankly, as retailers revolutionize how they build private brands, they could be heading into a pivotal moment — one that offers a chance to evolve these store brands into powerhouse brands.

Steve Zurek is the VP of Thought Leadership for U.S. Advanced Analytics, NielsenIQ (NIQ). He is a CPG industry veteran with more than 30 years of experience in sales and category development, having worked for PepsiCo, Procter and Gamble, Gillette, Quaker Oats and Haleon (GSK) Consumer Health.

It used to be that if you had established a strong brand name, you could count on consumers’ trust. But years of inflated marketing claims and bad experiences have eroded trust in brands, leading to a trust deficit — and it’s growing.  

“We are living through a very interesting transformation — brand names alone no longer carry the trust,” said Kimberly Shenk, Co-founder and CEO of values-based shopping solution Novi Connect, on this week’s episode of the Retail Remix podcast. “Today trust is earned, it’s not inherited. The democratization of data and information has really empowered consumers to ask deeper questions. They want to know, What’s in this product? Where did it come from? Do these claims actually mean anything?

“And this shift has opened the door for these direct-to-consumer challenger brands to build transparency into their DNA and use trust as a true differentiator,” she added. “That’s actually forcing legacy brands to either evolve or risk irrelevance, so today we’re seeing in the retail environment that trust is actually a really valuable currency that brands use with the consumer.”

Novi Connect has stepped into this void. The company uses data science to help brands verify their health, safety and sustainability claims so that retailers can confidently present their products to shoppers.

> Listen to the episode now

In the episode, Shenk explores the shifting dynamics of trust at retail, including:

• Why traditional brand trust is no longer enough — and what’s replacing it; 
• What consumers today actually care about when it comes to ESG — and how to communicate it; 
• The measurable impact of verified product claims on discovery, conversion and loyalty; and 
• How AI and large-language models are reshaping online merchandising in the digital age.

Tune in now to explore the future and importance of conscious commerce and how you can leverage it at your own company.