蘑菇AV

In China, ecommerce channel ad spending represents over 38% of total digital ad spending, and ecommerce search spending accounts for 64.0% of total search. Could the US figures reach similar heights?

The news: China is outpacing the US in retail media鈥檚 global rise, with nearly half of its digital ad spending now flowing through retail platforms. While Amazon still leads globally, its growth is slowing鈥攅xpected to rise just 18.6% in 2025. Meanwhile, players like Uber Eats, Meijer, and Albertsons are growing ad revenues at triple-digit rates. Our take: Retail media is becoming more fragmented and competitive. Success now requires portfolio diversification, especially as new channels鈥攍ike last-mile delivery and in-store signage鈥攇ain momentum. What began as an Amazon-centric, US-led trend is now a worldwide shift reshaping how consumers discover, consider, and buy.

The majority (80.9%) of worldwide retail media ad spend will take place in China and the US this year, according to a March 2025 蘑菇AV forecast.

The news: PayPal launched PayPal World, a global platform linking major international payment systems and digital wallets. Our take: While PayPal鈥檚 starting list of key partnerships represents Latin America, India, and China, the payment provider could penetrate further into European markets by tying up with the European Payments Initiative and the Wero wallet鈥攁s well as with top US wallets like Apple Pay and Google Pay or the nascent Paze.

Shein considers restructuring to minimize tariff, de minimis impact: But any move to shift production out of China could provoke Beijing鈥檚 ire鈥攁nd derail its long-awaited IPO.

The situation: Williams-Sonoma is raising prices on select items after its incremental tariff rate doubled since May鈥攆rom 14% to 28%鈥攄ue to higher duties on goods from China, India, and Vietnam. More pressure may be ahead after President Donald Trump recently signaled plans to increase tariffs on furniture imports. Our take: Despite operating in the sluggish furniture and home furnishings category鈥攚hich we project will grow just 0.4% this year鈥擶illiams-Sonoma is well-positioned to weather macroeconomic headwinds. Anchored by a diverse brand portfolio that resonates with affluent consumers across life stages, its multipronged strategy鈥攑rice increases, cost discipline, supply chain improvements, and AI-driven efficiencies鈥攏ot only will offset tariff pressures but also lay a durable foundation for sustained growth and market share expansion.

China is taking more decisive steps to encourage domestic consumption and rein in price wars that are fueling deflation and straining trade relations. Beijing said it would allocate an additional RMB 69 billion ($9.6 billion) to its consumer goods trade-in program starting in October, bringing the total funds issued this year to RMB 300 billion ($41.87 billion). At the same time, the government plans to 鈥渁ddress disorderly competition among enterprises鈥� and more closely scrutinize overcapacity in key industries, according to a Politburo statement. Addressing both issues鈥攄omestic consumption and damaging price wars鈥攁re key to China鈥檚 ability to weather higher tariffs and expand its influence on a global stage. But that鈥檚 easier said than done.

Est茅e Lauder posted a wider quarterly loss as sales slumped and warned that tariffs could reduce earnings by about $100 million over the next year. Est茅e Lauder is taking necessary steps to turn around its business鈥攆ocusing on product innovation, cutting costs, and broadening its customer reach鈥攂ut it will be tough given intense competition in the beauty market. With key rival L鈥橭real gaining US momentum and newer brands emerging, Est茅e Lauder must accelerate product innovation, reduce reliance on discounting, rebuild momentum in China, and take other steps to win new customers, or risk ceding more ground in the longer term.

The luxury sector is facing a 鈥渃hallenging鈥� and 鈥渟omewhat unprecedented鈥� environment, Prada Group chairman Patrizio Bertelli said鈥攃ausing even once-hot brands like the company鈥檚 namesake label to lose momentum. Luxury companies for the most part view the current downturn as a cyclical blip in an otherwise robust industry. But the prolonged slump is revealing structural challenges鈥攏amely, heavier reliance on American and Chinese consumers, as well as a tendency to lean on price hikes rather than innovation to drive sales.

The situation: Despite logging a sixth consecutive quarter of negative comps in鈥疐Y鈥疩3, CEO Brian鈥疦iccol鈥攚ho famously steered Chipotle out of its food鈥憇afety crisis鈥攕aid Starbucks鈥� turnaround is running ahead of schedule. Our take: While it鈥檚 encouraging to see Starbucks take some small steps in a positive direction, the road is still steep. Consumers remain price鈥憇ensitive, agile rivals in the US and China are taking multiple paths to steal share (both value鈥憀ed and trend鈥慸riven), and commodity costs are rising. To break out of its sales slump, Starbucks must execute on four fronts: Make service faster and better. The chain needs to speed up service without sacrificing the high-touch hospitality that Niccol is seeking. Find ways to differentiate. It鈥檚 easy to roll out new offerings, but it's hard to develop unique beverages that consumers will clamor for rather than recoil at (who can forget Starbucks鈥� Oleato line of olive oil-infused drinks?). Lean on technology. Refreshing Starbucks鈥� Rewards program and revamping its app are proven tools to drive occasional customers back into its stores. Stabilize China. Price cuts may lift traffic, but Starbucks needs to balance volume gains against margin erosion and fend off lower鈥憄riced competitors such as Luckin. Nailing these pillars鈥攕peed, product innovation, tech鈥憄owered engagement, and a calibrated China play鈥攚ill determine whether early green shoots turn into sustained growth.

The situation: Despite persistent US-China trade tensions, the Chinese economy is proving more resilient than many expected. Our take: China is navigating a high-stakes global environment more deftly than expected鈥攁 promising sign for Chinese retailers. Stronger-than-anticipated export growth, solid GDP performance, and growing trade diversification point to a more stable macroeconomic backdrop. That creates an opportunity for Chinese retailers and manufacturers to tap into rising domestic demand while expanding into alternative export markets. If this momentum holds鈥攁 big if鈥攖hey could potentially outpace the 2.0% YoY retail sales growth that we currently forecast.

The US-China trade war drives Shein to diversify its sourcing: Shein and Reliance Retail plan to start international sales of India-made Shein-branded clothes within six to 12 months.

Many retailers in Latin America like Mercado Libre, Rappi, and even Walmart function not only as commerce players, but as financial institutions as well. As a result, commerce media in Latin America is charting a different course than it has in the US, one that could result in unique opportunities for companies with access not only to shopper habits, but to financial data as well.

The news: China鈥檚 coffee giants are making their way to the US in the hopes of unlocking a lucrative market to offset pressures back home. Our take: Luckin鈥檚 and Cotti鈥檚 US launches are a problem for Starbucks, which is already struggling to compete with the companies in China and having a hard time winning over customers at home. Unfortunately for Starbucks, many of the moves it鈥檚 making鈥攕treamlining its menu, enhancing the in-store experience, leaning into premiumization鈥攔un counter to consumers鈥� current desire for variety, convenience, and value. That has created an opening for chains like Dutch Bros (and now Luckin and Cotti), which are better positioned to capitalize on emerging trends in the coffee space and can undercut Starbucks on price.

Tariffs drive ad pullbacks: Temu and Shein reduce US ad spending ahead of policy shift, signaling fallout across ecommerce and social platforms.

鈥沦丑辞辫辫颈苍驳 apps and marketplaces that specialize in ultralow-cost goods from China are gaining a foothold among US consumers鈥攚ith broader implications for the future of 别肠辞尘尘别谤肠别,鈥� our analyst Sky Canaves wrote in our Chinese Ecommerce in the US report. Canaves expanded on what鈥檚 driving this retail opportunity for companies like Shein, Temu, and TikTok in the US and how it will impact the US market on a recent 鈥淩eimagining Retail鈥� podcast episode.

With the ascent of Chinese ecommerce disruptors and the ongoing rivalry between Amazon and Walmart, the upcoming holiday season is expected to bring some big shifts. Some of those shifts include the lessening of Cyber Five鈥檚 importance and retailers losing focus on profitability, said our analysts Jeremy Goldman and Zak Stambor on a recent episode of the 鈥淏ehind the Numbers鈥� podcast.

This week, consumers are concerned about tariffs but continue shopping via mobile and on low-price retailers associated with China. Consumers are also less focused on fast delivery and flocking to Google for reviews.