Consumer and retail in 2026 is being reshaped by AI-driven personalisation, omnichannel fulfilment and a sharper focus on compliance. We outline the trends impacting the sector this year and beyond.

Published: 26 January 2026
Author: Simon McArdle

Mission possible: AI agents driving the future of retail

Agentic AI is redefining retail in 2026. Unlike traditional automation or generative AI, these autonomous systems don’t wait for prompts – instead, they plan, act and learn continuously. Agentic AI monitors data, spots opportunities and executes tasks within set parameters. For consumers, this means a shift from passive browsing to proactive, personalised shopping. Platforms like Google and Microsoft now offer AI agents that compare prices, build baskets and even complete purchases with consent.

Behind the scenes, retailers are using the technology to optimise inventory, adjust pricing in real time and detect issues before they escalate – freeing teams to focus on strategy and boosting margins. Other uses include virtual try-on (VTO). VTO allows retailers to show whether a lipstick shade suits a customer’s complexion or how a piece of furniture will look in their living room. The challenge is how to ensure privacy by design, secure explicit consent and ensure fairness in AI outcomes when using it.

Buit the opportunity is real: analysts forecast agentic commerce could generate $3-5 trillion in retail value by 2030, accounting for up to 20% of e-commerce spend.

Social‑commerce platforms go one step further, analysing behaviour to surface the right product at the right time. This has fuelled a sharp rise in channels like TikTok Shop,  an in-app e-commerce feature that lets users buy products directly within the app, which saw its sales increase 55% year-on-year in the UK in December 2025.

For retailers, the challenge is clear: adapt fast or risk falling behind in an AI‑orchestrated marketplace.

Sustainability: Still a growth driver, but now a compliance risk

For more than a decade, sustainability has been one of retail’s strongest selling points, with 41% of market growth in consumer-packaged goods coming from products marketed as sustainable. Today, those products hold 24% of branded market share in the US and 38% in the UK.

The influence is undeniable: adding a sustainability label can boost demand by almost 15% without changing price or advertising.

But there’s a catch: the claims only work if they’re credible. Regulators are watching and they’re leaning into AI to help them do it. In 2024, the Advertising Standards Authority (ASA) used its AI-powered Active Ad Monitoring System to scan 28 million ads, with more than 90% of those amended or withdrawn flagged by AI, not complaints from consumers.

Combine that with the Competition and Markets Authority (CMA)’s Green Claims Code and new powers under the Digital Markets, Competition and Consumers Act (DMCC), and the stakes are clear: getting it wrong can mean fines of up to 10% of global turnover. These are just some of the trends impacting advertising and marketing this year.

Omnichannel: Beyond the storefront

With the shift towards e-commerce, how retailers use physical stores will continue to evolve. In today’s omnichannel world, many are moving beyond being places to just browse and buy. Instead, retailers are increasingly leveraging their existing portfolio of bricks and mortar to create hyper-local fulfilment hubs, which serve as mini distribution centres that make same-day, even near-instant delivery and collection possible.

Why? Because consumer expectations have shifted. Waiting days for an order feels outdated. Getting what you want within hours is now the norm.

Physical stores can power last-mile logistics, widen delivery and pickup options and connect seamlessly with online platforms. In addition, platforms that began with groceries are now beginning to target fashion, electronics and luxury goods. Uber and Deliveroo are also trialling same‑day drops for high‑value items, increasing customer expectation of how quickly they can receive a product they buy online down from days to hours.

Cyber threats, fragile supply chains and trade turmoil: A new retail reality

Retail is operating on a knife-edge. Geopolitical tension, regulatory scrutiny and digital threats are no longer background noise – they’re shaping every decision. From cyber-attacks and fragile supply chains to trade pressures, the risks are multiplying.

Shifting dynamics, from regulatory scrutiny to trade pressures, are influencing where and how retailers operate. This is something backed up by our litigation risk 2026 report, which surveys 360 UK-based general counsel and senior in-house lawyers. When respondents working in consumer and retail were asked which geopolitical trends had the biggest impact on risk over the past year, three themes dominated: state-sponsored cyber-attacks came top at 77%, highlighting the scale of digital vulnerability; supply chain risks followed at 67%, as global fragility continues to disrupt operations; and international trade tariffs and protectionism added further pressure (55%), reshaping cross-border strategies and exposing businesses to new layers of complexity.

To counter these risks, businesses in the sector are taking decisive steps. Building resilience against cyber-attacks tops the list at 74%, as digital threats escalate. Two-thirds (66%) are rethinking their supply chain matrix, strengthening weak links and improving visibility. And more than half (53%) are updating standard contract terms for international suppliers, ensuring agreements reflect today’s volatile trade environment.

For consumer-facing businesses, staying ahead of geopolitical and regulatory shifts is vital as we move into 2026. Retailers that anticipate change, embed DMCC compliance early and build agility into operations will be best placed to protect reputation, maintain trust and expand confidently in an unpredictable world.

Value in a volatile economy

In a climate of economic uncertainty, shoppers aren’t spending on autopilot, they’re making deliberate choices. Increasingly, consumers are trading down in some categories so they can invest where it matters most.

This isn’t about chasing the lowest price. It’s about justifiable value: quality and relevance that feel worth it. For retailers, that means every part of the offer needs to work harder: from pricing architecture to product mix and brand promise. Those who deliver on value, whether through affordability, premium options or flexible product ladders, will earn loyalty in a market defined by trade‑offs and prioritisation.

Health as the new battleground

The proliferation in use of weight‑loss drugs last year will continue to change what consumers eat and how retailers respond. Appetite‑suppressing treatments like Ozempic are already reshaping buying habits, with some retailers reporting dips in higher‑calorie sales while there has been a rise in demand for foods rich in protein. Food brands are under pressure to reformulate, while tightening HFSS advertising rules restrict how and where products can be promoted, especially online and in child‑focused spaces.

As a result, retailers and manufacturers will need to balance demand for healthier choices with compliance, while adapting to new consumption patterns driven by medication. Those who act fast, aligning product strategy with regulation and shifting behaviours, will stay relevant in a market where health is a new battleground.

Deals driving the next chapter

M&A will continue to reshape the sector in 2026. Over the past year, there’s been a steady stream of deals: strategic acquisitions, distressed sales and bold moves to snap up struggling brands or break into new categories. Some of the deals we advised on last year back-up that trend, including acting for Maven Group on its acquisition of Wagtail/ETM Collection, advising Santander Group and ABN Amro Bank on an £88 million refinancing facility for PPHE Hotel Group’s flagship asset, Park Plaza Victoria London hotel, acting for Hilco Capital on the strategic management-backed acquisition of Lakeland, and advising FTI Consulting as administrators of DC London PIE, franchise operator of Pizza Hut UK, on its pre-pack sale to Yum! Brands.

Expect that momentum to continue, with opportunities at both ends of the market, from luxury to value.