Retail enters the era of "control economy": digital channels contribute 80% of growth, competition focus shifts to pricing and visibility

Event Overview

Global retail growth has significantly slowed in 2025, but growth is heavily concentrated in digital channels. According to the latest report from Euromonitor International, global retail real growth is only 2% in 2025, yet e-commerce contributes approximately 80% of total growth, indicating that expansion is concentrating on a few digital platforms.

Market Background

The report states: "Growth has not disappeared, but it has concentrated in fewer channels, fewer platforms, and increasingly fewer decision systems." Retail competition is shifting from scale expansion to control over pricing, product discovery, profit margins, and consumer decision-making. This shift means that 2026 is not just a phase of omnichannel optimization, but a competitive reset in the face of a more complex ecosystem. Enterprises that fail to secure influence in these areas face long-term decline risks.

Platform and Brand Impact

Platforms and Sellers - Logistical Challenges: Geopolitical fragmentation and tightening trade rules are reshaping operations. The U.S. has abolished the de minimis exemption, and similar adjustments have been introduced by the UK, Japan, and the EU. Conflicts in the Middle East exacerbate supply chain instability. Euromonitor's "2025 Industry Voice Survey" shows that 62% of industry professionals expect global tariff changes to impact their business within the next 12 months. - Rising Costs: War risk surcharges have reached $1,500–$4,000 per container, fuel costs have risen, and ship diversions add 10–14 days of transit time. - Real Cases: Temu has extended delivery windows; Inditex reported apparel delivery delays due to air freight disruptions at Gulf hubs.

Brands and Consumers Consumer behavior is shifting toward sustained cost-cutting rather than short-term inflation responses. Euromonitor's Consumer Lifestyle Survey from January–February 2026 shows that 47% of global consumers plan to save money over the next 12 months, indicating that price sensitivity is becoming a structural long-term behavior. Consumers are increasingly influenced by ultra-low-price digital platforms, algorithm-driven price transparency, and slowing growth in discretionary spending. In response, many retailers are expanding tiered product portfolios, scaling private labels, and building loyalty-driven value ecosystems and brand extensions.

The report emphasizes: "Retailers must choose where to compete on price and where to compete on differentiation. Attempting to defend both positions has proven unsustainable."

Consumer Trend Analysis

Consumer price sensitivity is becoming a long-term structural characteristic. The 47% planning to increase savings indicates that even as inflationary pressures ease, consumers will remain cautious. Additionally, AI-driven recommendation systems are changing how consumers discover products. In 2025, AI-driven e-commerce platform recommendation traffic grew by 304%, far outpacing the growth rate of traditional traffic channels. This means that the products consumers are exposed to are increasingly determined by AI algorithms, rather than being directly controlled by retailers or markets.## Regional Market Impact

• North America: The U.S. eliminated the de minimis exemption, imposing tariffs on low-value goods from China and other countries, directly impacting platforms like Temu and SHEIN, leading to weakened price advantages and extended delivery times.
• Europe: The UK and EU have followed with similar regulatory adjustments, increasing cross-border retail complexity.
• Asia: The Middle East conflict has led to rerouting via the Cape of Good Hope, increasing shipping time and costs, affecting trade from Asia to Europe.
• Middle East: The conflict itself directly disrupts air cargo hubs, such as Dubai, affecting fast fashion brands like Inditex.
• Global: Tariff changes and supply chain disruptions impose cost pressures on retailers in all markets.

Future Trends

AI Becomes the Retail "Control Layer" AI is not only an operational tool but also a new layer controlling product visibility and discovery. Nearly 50% of businesses report that AI has already impacted their operations, and 42% plan to increase AI investment. AI is being deployed in pricing automation, inventory management, supply chain optimization, and customer targeting. But the more critical shift is in "discovery": generative AI systems increasingly shape the products consumers see and ultimately purchase.

Competitive Reset: 5-Vector Strategy Euromonitor notes that the key challenge for retail leaders is no longer "how to grow" but "how to maintain discoverability, preference, and profitability within a system they do not fully control." Successful retailers will possess a specific set of strategic capabilities, referred to in the report as the "5-Vector Strategy Reset."

Conclusion Retail in 2026 is no longer simple omnichannel optimization; it has entered the era of the "control economy." Companies that master pricing power, product discovery, and influence over consumer decisions will stand out. Platforms and brands that fail to adapt to this shift risk losing market share and being marginalized.

--- *Source: Euromonitor International report, republished by Asian Business Review.*