Cost pressures, changing expectations, and making better choices more affordable: our retail trends for 2026

Few industries move faster than grocery retail. And with a brand-new year beckoning, Charlie Llewellyn – Global Head of Retail at dunnhumby – has put pen to paper on what he believes will be some of grocery’s biggest trends in 2026.

From cost of goods and customer expectations through to AI, health, and the rise of retailer ecosystems, read on to find out what the coming year might have in store…

AI and data science will be cemented as the foundations of great retail

Today, data-driven decision-making and advanced analytical techniques – AI included – are the foundational elements of retail success. These aren’t themes that are going to play out over the next 12 months; they’re the underpinning capabilities that will allow retailers to navigate all the other challenges and opportunities coming their way.

For a deeper look at some of the specific ways in which things might evolve in this area during 2026, check out my colleague Sandra’s own predictions here. For the purposes of this post, though, let’s just acknowledge that while AI and data science aren’t trends in the traditional sense, they will play a major role in shaping how everything else on this list plays out.

With the context now set, let’s look at a few of the more pointed issues set to face the industry across the coming year.

Redefining value in a cost dynamic world

Inflation may have eased, but behaviours established at the peak of the cost-of-living crisis continue to dominate. As shown in our Consumer Pulse research, shoppers remain worried about both their own personal finances and the economy as a whole. In response, they’re making increasingly nuanced trade-offs – cutting back or trading down in some categories so that they have the financial flexibility to spend on luxuries elsewhere.

Retailers, meanwhile, are finding themselves similarly squeezed: cost of goods remains one of their primary concerns, with staffing and operational expenditure only adding to that pressure. The challenge now will be to continue to deliver great prices, without engaging in a race to the bottom. To do that, retailers will need to keep one critical question in mind: “how do you deliver genuine value in a world where costs are only going one way?”

The answer here is that value isn’t just about price; it’s about balance. It’s about blending quality, affordability, convenience, and choice. Expect private brand – something that enables customers to move up and down the price ladder depending on their own spending priorities – to become even more important as a result.

Stronger supplier partnerships will offer a path to competitive advantage

We’re all aware of the current picture when it comes to the supply chain. Geopolitical risks, tariffs, ethics, climate change, and crime all continue to pose a threat. That makes deep, long-term partnerships with suppliers increasingly vital. When disruption is a constant, retailers want to be the partner that suppliers prioritise – the one whose shelves remain stocked where others may struggle.

The stakes here go well beyond operational resilience, though. Going forwards, the most successful retailer/supplier partnerships won’t just revolve around volumes or availability. They’ll be founded on shared goals, clearer alignment, and more collaborative decisions.

Today, retailers have more ways than ever to deliver value to suppliers. From deep insights through to additive media activations, they have the tools to help suppliers understand customers, build their brands, and make sharper commercial decisions.

Why does that matter? Because, ultimately, those who create the most attractive propositions will be the ones that suppliers choose to invest in – with product, with innovation, and with media spend. As the year goes on, being a “good” partner will carry real commercial weight.

Speed, culture, and personalisation will be the watchwords for Gen Z

Perspectives – and expectations – are shifting. As new trends and issues continue to reshape the way in which people shop, retailers will need to be ready for a world in which decisions are based not just on traditional factors like price and quality, but new and emerging dynamics as well.

Younger shoppers – Gen Z specifically – will be the ones to watch here. With their expectations being set by global trends like fast fashion and influencer culture, retailers will need to deliver new standards in speed and personalisation if they want to keep up. Does that mean that previously trending issues like sustainability no longer matter to younger consumers? No – but the focus for now seems to be squarely on the shopping experience.

Retailer ecosystems come to the fore – but the benefits go beyond just commercials

Alternative revenue streams have always been an attractive proposition for retailers. Retailer ecosystems – taking in everything from membership programmes and retail media to financial services and healthcare offerings – have long promised a way to deliver on that abundant commercial potential. What’s increasingly clear, though, is that they can offer something more, too: the chance to deepen customer relationships and increase lifetime value.

That’s enabled through greater relevance. The more services a retailer offers, the more opportunities there are for them to participate in their customers lives. So long as retailers have a genuine understanding of what shoppers want, the potential to deliver more focused offers and content will only continue to grow.

There’s a secondary benefit at play here as well. As a retailer’s proposition diversifies, their partnership power with suppliers continues to strengthen. That’s true not just in terms of the pure commercial opportunity, but the possibilities around insights monetisation and retail media too.

The cost of making “better choices” is still in mind for retailers and shoppers alike

Where affordability allows, healthier choices, sustainable choices and ethical and socially responsible choices are still on the mind of customers too. There are many ways for them to make better choices at the shelf today and, as we’ve seen across our Retailer Preference Index studies from the past 12 months, customers are increasingly invested in doing so – tending to uprate retailers that demonstrate their commitment in these areas.

As we’ve already discussed above, though, the main challenge here is likely to be cost. Better choices tend to be more expensive choices, too, and while shoppers might want retailers to make healthier and more sustainable options more affordable (particularly those in lower-income brackets), doing so without further squeezing profitability is anything but simple.

All in all, this could be one of the hardest to balance issues that retailers face in 2026. As customers strive to balance aspiration with affordability, retailers will find themselves under pressure to support better choices in a way that makes economic sense – for both sides.