The retail industry is undergoing a major transformation in ecommerce and brick-and-mortar, according to a recent eMarketer analysis. The era of inventory-led retail is ending, and the shift toward brands and the customer experience is emerging, the report noted, and these changes are set against a backdrop of heightened economic uncertainty.

But what are the changing fundamentals of the retail sector and the most important trends that will shape the year ahead?

First, how much will U.S. consumers spend on retail and ecommerce in 2020?

eMarketer has forecast a moderation in growth rates vs. previous years, with total retail sales expected to grow 2.0 percent to $5.574 trillion and ecommerce sales expected to grow 12.8 percent to $666.28 billion.

Secondly, which retailers will succeed, and which will struggle?

Amazon, Walmart, Target and other leaders are well-positioned for the year ahead, as are many of the direct-to-consumer (D2C) brands now expanding into brick-and-mortar, according to eMarketer. Department stores and other traditional mall-based retailers will continue to struggle.

Thirdly, Which innovations will reshape physical retail?

In brick-and-mortar, innovation in experiential and frictionless retail will begin to scale, according to eMarketer’s forecast. “The rise of click-and-collect, easy returns, mobile order-ahead and cashierless checkout will help streamline transactions,” the research firm noted. Meanwhile, physical “Retail as a Service” platforms will bring more digitally native brands to the masses through brick-and-mortar storefronts and experiences.

Finally, which innovations will influence how consumers shop online?

Social commerce will evolve how consumers discover and shop for brands digitally with more shoppable content and a streamlined path to checkout. Digital installment plans will make ecommerce purchases more affordable without saddling consumers with added debt, according to the eMarketer report.

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