For 2026, holiday commerce won’t hinge on flashy discounts or eye-catching displays; it will be decided in the invisible battleground where data, inventory and operations converge.
Shoppers can expect AI-curated journeys as the default, from gift discovery to fulfillment, and a seamless and intuitive experience.
Separately, retail leaders will double down on technology investments, but the winners will be those that translate ambition into execution. Our recent research, conducted in collaboration with Coresight, Store of the Future: Unlocking Performance Through Innovation, found that 92% of retailers are actively investing in solutions to optimize their store operations.
But a smart store is only as smart as the data that powers it. Many retailers are over-investing in impressive, customer-facing tech while under-investing in the unglamorous but essential data integration that makes it work. This year will be a stress test to see whether those investments are translating into actual outcomes or just optics.
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The Foundational Flaw: The Best AI Can’t Sell what isn’t There
With holiday shopping now stretching across months, inventory resilience will be the defining factor in 2026.
Industry data show that inventory missteps remain the top driver of margin erosion. Demand forecasting powered by unified AI models will separate leaders from laggards.
No AI-powered promotion or recommendation can save a sale if the product isn’t available. It doesn’t matter if your personalized promotion engine sends a tantalizing offer for an item that’s sitting in the wrong distribution center. Operational breakdowns negate technological breakthroughs, every single time. These instances are a direct threat to the bottom line and customer loyalty. The promise of a “smart store” crumbles at the empty shelf.
Store of the Future: From Concept to Industry Standard
Expect omnichannel to be a differentiator no longer; it will be a table stake. Retailers without real-time, unified data will be invisible to the modern shopper.
The “Store of the Future” is evolving into the “Industry Standard Store,” a fully integrated ecosystem where every channel speaks the same language: real-time data.
A successful omnichannel strategy integrates various channels. It requires a single, real-time view of the customer, the inventory and the order. When a customer opts for buy online, pick up in-store (BOPIS), they aren’t just buying a product; they are buying certainty and convenience. Delivering on that promise depends entirely on having real-time, unified data that ensures the item they purchase online is pulled from the floor and waiting for them when they arrive. Without that deep backend integration, BOPIS goes from a competitive advantage to a customer service nightmare.
Without that connective tissue, every innovative front-end experience risks collapsing under back-end fragmentation.
Precision Promotions: Prediction for 2026
Without a doubt, your promotional strategy must be sharper and more intelligent than ever.
This year, generic promotions will disappear, and AI- driven personalization will be the only viable path to ROI. Today, the real opportunity lies in personalization at scale, which is only possible through AI. Industry consensus: Investment in advanced analytics will double by 2026, with personalization at scale becoming the norm.
Effective personalization is the synthesis of multiple data streams, including a customer’s past purchase history, their recent browsing behavior, current inventory levels and overall demand signals. An AI-powered system can process this to deliver the right offer on the right product at the right time, turning a cautious spender into a confident buyer. However, the technology is only as good as the data it’s fed. A fragmented, incomplete view of the customer leads to promotions that feel intrusive or irrelevant, eroding trust instead of building it.
The Investment Paradox: Spending More, Struggling Harder
Expect the paradox to persist unless retailers shift focus from flashy front-end tech to foundational data integration. The answer lies in how that money is being spent. The allure of the new is strong: AI-driven shelf scanners, augmented reality try-on mirrors and automated checkout systems. These are meaningful innovations. However, they are often implemented as point solutions layered on top of a fragmented and outdated data infrastructure.
Real-time data will no longer be a benefit; it will be a prerequisite for automation and availability. The high cost of implementation (cited by 48% as the most significant barrier) becomes even more daunting when those investments fail to deliver ROI because the foundational work of data integration was skipped.
If retailers fail to evolve now, the consequences will be immediate and lasting. Every disconnected system and delayed decision amplifies the risk of stockouts, order errors and frustrated customers who may abandon the brand for good. Operational blind spots do not just dilute holiday revenue; they create long-term loyalty erosion and ballooning costs that compound across seasons. In an industry where switching is effortless, even a single broken journey can shift demand permanently to competitors who deliver with precision.
From Ambition to Execution
2026 will be a referendum on operational intelligence. The data shows a near-universal ambition among retailers to modernize, but it also reveals a persistent and costly gap between that ambition and day-to-day execution.
The winners will be those that unify existing tech into a single, real-time decisioning platform. Retailers that invest in integration platforms, real-time visibility and unified decisioning will be the ones that convert data chaos into business clarity.
For leaders, the feeling that you are investing heavily yet still wrestling with the same old problems is valid — you are not alone. The path forward is not to spend more, but to spend smarter. Prioritize the connective tissue. Invest in platforms that unify your data. Empower your teams with a single source of truth.
Close the gap between smart tech and core operations, and you won’t just survive 2026, you’ll define it.
Sampath Saagi is currently the SVP and Group Head at Tech Mahindra, with proven leadership skills for building, scaling and transforming multi-hundred-million-dollar technology services businesses. Saagi has 25 years of deep expertise in IT ecosystems with a blend of diverse strengths covering strategic leadership, digital transformation, relationship management, business development, solution sales, program management and global delivery. Saagi also has a proven track record of developing and executing business plans and delivering profitable business growth. This experience includes managing a portfolio of accounts spread across manufacturing, financial services, healthcare, life sciences, insurance, energy and much more.
