Shoppers Browse In Store, Buy Online

Perth, Oct 21: Walk through a shopping centre on a weekday and the problem is easy to see: the aisles are quiet. Many of the people who do come in already know what they want. They’ve seen the product online, compared prices on their phone, and read the reviews. They’re in the store to touch it, try it on or check the colour in real light. Then many of them leave and buy it later, often from whoever is cheapest online.
Shoppers today arrive better informed than the staff serving them. Retailers are also dealing with another problem: theft. Shoplifting has become a daily cost of doing business, which eats further into margins already squeezed by weak demand.
That is the backdrop to new research from Boston Consulting Group. The firm surveyed 50 senior retail executives across Asia Pacific and spoke with more than 100 others in person. Its conclusion is that retailers are being pulled in two directions. They have to protect the business they have today while paying for the one they will need tomorrow.

Back to basics

Weak consumer demand is the biggest external pressure retailers face, named by 76 per cent of respondents. In response, most are focusing on what they already have. Two in three see better sales from existing stores as their main source of growth over the next year. Just over half are counting on getting existing customers to spend more. Newer options such as acquisitions and social commerce rank lower.
Cutting costs and running leaner operations are also high on the agenda. More than half of leaders put them among their top three priorities.

Stores still get the money

Online sales are growing. Today 37 per cent of retailers make more than a tenth of their sales online, and 61 per cent expect to pass that mark within three years.
Even so, physical stores still get the most investment. Leaders were asked how they would spend an extra 10 per cent of capital. They said they would put nearly a quarter of it into their store networks, more than into any other area.
This matches what shoppers are doing. The store is still where people go to see and feel a product before they decide. The challenge for retailers is making sure that visit ends in a sale at the till rather than a purchase on someone else’s website.

Big talk on AI, little spending

Retailers see AI as both a threat and an opportunity. More than four in ten rank AI and technology disruption among their top three market pressures. Close to seven in ten expect AI to lift earnings, or see it as essential, over the next three years.
Their spending doesn’t match that ambition. Almost nine in ten retailers spend less than 1 per cent of revenue on AI, or don’t track the figure at all. The investment they do make is spread across many projects, which suggests most haven’t yet decided where their biggest bets should go. They also report other obstacles: poor-quality data, staff who need training, and a shortage of AI talent.

Geopolitics: hurt, but coping

Almost nine in ten retailers (89 per cent) say geopolitical events have affected their business, though most describe the impact as moderate. Only seven per cent expect the disruption to last long term. The most common responses are cost-cutting (53 per cent) and price rises (40 per cent). Bigger structural changes, such as finding new suppliers, are less common.

The real bottleneck is people, not technology

Asked what would most speed up their plans, leaders didn’t name new technology. They pointed to faster decision-making and better teamwork between departments, each chosen by 44 per cent. Reshaping the workforce and operating model is the top people priority for 68 per cent of respondents.
For a sector where customers now research everything before they arrive, that may be the key point. The shopper has already done their homework. The retailers that win will be the ones that can move as fast as their customers do.

Source: Boston Consulting Group, “Inside the Minds of Asia Pacific Retail Leaders: Growth, AI and Execution,” October 2026.