326: Retail Review Of The Year 2024

The retail industry continues to change and transform, and in this episode, join Oliver Banks and look back at stand-out news stories from the past 12 months. As Amazon felt the heat of competition, we saw John Lewis reverse a major change. Meanwhile, many retailers struggled whilst AI looked to turn everything on its head. Discover the most transformative and strategic moves, as well as exploring crucial retail trends that have played out over 2024 and what they mean for 2025.

Listen now to discover:

• Why Amazon are under pressure and how they’re responding.
• Which technology is dividing the retail industry – and why it’s confusing to decide what’s right.
• How John Lewis are revising their strategy whilst also making big bets.
• Plus more important innovations and evolutions from across the industry.

 

Four (plus one) transformative stories from the retail industry

1. Amazon switches from disruptor to disrupted

In 2024, the retail industry witnessed significant shifts, starting with Amazon transitioning from a disruptor to being disrupted by Chinese discount marketplaces Shein and Temu. These platforms have attracted consumers with super low prices, leading Amazon to respond with its own overseas discount marketplace, Amazon Haul. This move marks a strategic shift for Amazon, focusing on price competitiveness rather than just convenience and range depth, as the company seeks to maintain its market share in an increasingly competitive space.

2. Iconic brands forced into administration

The year also saw many iconic brands and retailers like Ted Baker, The Body Shop, Farfetch and Homebase forced into administration, contributing to a rise in retail job losses. This trend highlights the financial struggles within the industry, exacerbated by increased labour costs in the UK. The situation underscores the importance of transformation and the need for retailers to reassess their strategies to remain viable amidst tightening profitability.

3. John Lewis reverses a major change whilst making a big bet

John Lewis made headlines by reinstating its “Never Knowingly Undersold” price promise after removing it in 2022, reflecting its focus on customer value and business model adaptability. Additionally, the company ventured into property development to diversify its revenue streams, receiving planning permission for residential flats above a Waitrose store. This dual focus on retail and property development signifies John Lewis’s strategic shift to ensure long-term sustainability and growth.

4. The great self-checkout debate

The debate over self-checkouts continued, with retailers like Walmart and Target removing them, while others like Primark and M&S expanded their use. The argument is about balancing cost-saving and convenience against customer experience and potential shrinkage or stock loss. Retailers must offer flexible checkout options that cater to diverse customer preferences, emphasising the need for a nuanced approach rather than a one-size-fits-all solution.

And the story that wasn’t: AI fails to make a big splash

Finally, while 2024 was anticipated to be a breakthrough year for AI in retail, its impact has been more subdued than expected. Although AI is driving some significant business benefits, its integration remains complex, with many applications being non-customer-facing. It’s a good example of Amara’s Law which states “We tend of overestimate the effect of a technology in the short run and underestimate the effect in the long run.”

Additional episodes to listen to next

Many larger retailers have been unlocking new revenue streams and sources of profit through retail as a service (RaaS) offerings. Companies like Amazon, Shein, Walmart, Ocado and THG all have developed their own RaaS businesses. Discover more about this trend in episode 316: The Rise Of Retail As A Service (RaaS) and episode 317: Is Retail As A Service Leveling the Playing Field?

In the episode, you’ll have heard that John Lewis are experimenting with a new business model. Learn more in episode 310: Beyond The Classic Retail Business Model (part 1) and episode 311: (part 2).

In episode 324: Uncovering The Blind Spots Of Innovation, Carl Boutet joined to explain why retail businesses are being caught off-guard by rapidly developing technologies and what you can do about it.

There have been plenty of other episodes to check out. If you want a whistle stop tour of some of the best bits, then listen to episode 319: Golden Nuggets From The Sixth Year Of The Podcast (part 1) and continuing into episode 320: (part 2).