Amid the AI frenzy, retailers are still placing bets on brick and mortar, just more carefully. Nearly 78% report moderate or significant in-store investment, and about a third maintain a balanced mix of physical and digital channels, according to Morning Brew Inc. data. With more than 5,000 store openings forecast in 2026, according to Coresight Research, this wave is less about rapid expansion and more about strategic refinement.

Stores are increasingly viewed as brand builders, not just transaction hubs. In a survey conducted by Retail Brew, 62% of retailers said they’re investing to strengthen brand perception, and 58% to boost loyalty, outpacing conversion goals. Experiential formats reflect a push to create immersive, community-driven spaces that digital channels can’t replicate.

AI adoption is widespread at 82%, but it’s largely working behind the scenes in marketing and operations rather than reshaping the sales floor. All of this comes as 76% of retailers report heightened price sensitivity and more than half have raised prices amid tariff pressures, making stores a key differentiator in a cautious economy.