Consumer Insight:
Consumer Services and Experiences are Unlocking Incrementality
As spending priorities evolve, retailers have more opportunity than ever to capture value beyond the products they sell.
Consumer spending is favouring services and experiences, giving retailers room to expand their role in customers' lives.
Between 2022 and 2025, spending on services and experiences grew approximately 1.5 times faster than spending on physical goods. While product expenditure has faced greater volatility, services have demonstrated comparatively resilient growth.
The prize is substantial: our analysis identifies a UK retail-adjacent services market worth approximately £308 billion in 2025, spanning areas where retailers can extend their offer past the point of sale.
The prize is substantial: our analysis identifies a UK retail-adjacent services market worth approximately £308 billion in 2025, spanning areas where retailers can extend their offer past the point of sale.
For retailers, this is a chance to generate additional revenue, strengthen customer relationships and encourage repeat engagement.
It also challenges the idea that stores are a legacy cost to be cut. Services give physical retail a renewed purpose. Whilst online customer journeys are becoming increasingly shaped by the recommendations of AI Agents, the theatre and experiential value of stores is growing as a counter-balance, giving consumers access to creative spaces, inspiration and advice.. This is particularly true in categories where expertise, reassurance or the ability to experience products first-hand plays an important role in purchasing decisions.
Retailers that can combine these strengths with relevant services can differentiate themselves in ways that are more difficult to replicate through price competition alone.
IKEA, for example, has developed an ecosystem of services around home improvement, spanning measurement, planning, delivery, assembly, installation and resale. By supporting customers throughout the project lifecycle, the business can capture value beyond the initial furniture transaction.
The opportunity is not simply to add services for their own sake, but to identify where they address genuine consumer needs and strengthen the core proposition.
For retailers, the next wave of growth may lie not in the product itself, but in everything around it.